(NEXSTAR) — Netflix announced Tuesday it would be moving 2% of its cash pile, about $100 million, to financial institutions that “directly support Black communities.”
The streaming company said the grass-roots initiative is part of its “commitment to racial equity.”
“Banks that are Black-owned or led represent a mere one percent of America’s commercial banking assets,” Aaron Mitchell, Netflix talent acquisition director, and Shannon Alwyn, Netflix treasury Director, wrote in a corporate blog post Tuesday. “This is one factor contributing to 19 percent of Black families having either negative wealth or no assets at all.”
The company’s first step in the initiative will be to split $35 million two ways: $25 million for a new fund called the Black Economic Development Initiative and $10 million deposited with the Hope Credit Union, which serves five southern states.
HOPE said in a statement that the Netflix investment will be in the form of a Transformational Deposit, which will be used to import funds into “capital-starved communities” in an effort to “build wealth and foster economic mobility.”
“Over the next two years, HOPE estimates the Netflix deposit will support financing to more than 2,500 entrepreneurs, homebuyers and consumers of color,” the credit union said.
Netflix said that “systemic racism in America has sustained a large financial gap between Black and White families,” and that shifting some of its cash assets to institutions that serve Black communities could help close it. The company also said it hopes its investment encourages other large companies to do the same.
There are roughly 30 banks worldwide that Netflix uses to hold its cash, reports The New York Times.