Waterloo entrepreneur works to open Iowa’s first Black-owned bank

By Megan Sayles AFRO Business Writer msayles@afro.com

Reshonda Young is a Waterloo, Iowa native and entrepreneur on a mission to open the state’s first Blackowned bank. The Bank of Jabez, which is set to open this year, will be a community development financial institution (CDFI) and will work to prepare and empower people to create generational wealth.

The pressing need for a Black-owned bank in Iowa became clear to Young in 2018 when 24/7 Wall St. released a special report identifying Waterloo as the worst place for Black Americans to live in terms of economic stability.

The financial analysis and commentary company used census data to examine racial disparities in socioeconomic indicators, like poverty, homeownership, unemployment and income.

In Waterloo, the report found that Black residents earn less than 50 percent of what White residents earn and the Black unemployment rate was more than five times that of the White unemployment rate. It also illustrated the homeownership gap between White and Black communities.

“In Waterloo, when we look at the wealth gap, one of the biggest things that contributes to that is homeownership,” said Young. “When we look at the rate of Black homeownership in Waterloo, we’re looking at below 30 percent. When we look at the rate of White homeownership, we’re looking at below 70 percent. That’s a huge difference.” because they tend to provide more accessible education around homeownership and financial literacy, and they lend to Black communities at higher rates than White-owned financial institutions.

“We know that when Blacks go to banks for home loans we’re denied at least two to the three times the rate that Whites are denied, and that’s the same for small business loans,” said Young. “When you go into a Black-owned bank, you know that they’re not discriminating against you because you’re Black. Blackowned banks can increase homeownership and provide the funding that small business owners need in order to grow their businesses.” going through the program because what you’re teaching may not be as relevant to them as you thought it would be,” said Young. racial wealth gap.

In addition to her work to open the Bank of Jabez, Young also runs the Cedar Valley Black Business & Entrepreneurship Accelerator, created by 24/7 Black Leadership Advancement Consortium in Waterloo.

She also said there is a stark difference in the ability for Black residents to be approved for personal and business loans compared to their White counterparts. For Young, Black-owned banks play a crucial role in reducing the racial wealth gap

The accelerator launched in 2020 and was designed to proactively serve the needs of the local Black business community, and thus far, it has trained more than 50 entrepreneurs. It was also honored by the United States Association of Small Business and Entrepreneurship for being a model community accelerator.

“One of the biggest lessons that we’ve learned is that you may have this curriculum that you have set and are working through, but you really have to listen to the people who are