Telling the story of the nation's first black-owned banks
The nation’s first black bankers were able to overcome numerous challenges to begin serving as an important source of credit while also providing training and jobs. These banks were among the most innovative and resilient of the era.
The nation’s first black bankers were able to overcome numerous challenges to begin serving as an important source of credit while also providing training and jobs. These banks were among the most innovative and resilient of the era.
This summary introduces “Let Us Put Our Money Together: The Founding of America’s First Black Banks,” a new book published by the Kansas City Fed and authored by Executive Writer and Historian Tim Todd. Download or order a free copy of the book.
Decades before the dawn of the Civil War, there were discussions about creating black-owned banks in the United States. These institutions would serve not only as vital and necessary catalysts for economic opportunity, but also stand as powerful symbols in the fight against slavery and for racial equality. Given the environment, it is understandable why these earliest visions could not be immediately realized.
Although the war eventually brought freedom, access to the nation’s established financial system was not forthcoming. Instead, the necessary credit to establish a business or help a family had to be sought through non-traditional channels, such as through wealthy individuals who were willing to lend or cooperative initiatives. Often these efforts only achieved limited success. Meanwhile, a bank established by the government to serve the former slaves – known as Freedman’s Bank – came under the control of established financiers. The machinations of these powerful individuals, who used the bank’s resources for their own purposes, decimated the life savings of thousands of depositors.
Finally, in the late 1800s, the dreams of the earliest visionaries were realized. The nation’s first black bankers were able to overcome numerous challenges to begin serving as an important source of credit while also providing training and jobs. These banks were among the most innovative and resilient of the era. They were truly community banks, offering the benefits described by the historic Maggie Lena Walker, who later became famous as the nation’s first female minority banker and described the mission of the bank as follows:
“Let us put our moneys together. Let us use our moneys; let us put our moneys out at usury among ourselves and reap the benefit ourselves. Let us have a bank that will take the nickels and turn them into dollars.”
