The U.S. Banking Industry, Affordable Housing, and Inner City Redevelopment

Abstract

Increased owner-occupied housing and small start-up businesses are central ingredients in inner-city redevelopment strategies in the US, based on the premise that owners will act to protect the value of their investment through community participation. The US banking industry is in a position to promote affordable home-ownership and to extend credit to small business owners, but banks often lack trust and credibility in the communities where their services are most greatly needed, and they often lack insight regarding the financial management practices of the households and businesses whose formidable energies and aspirations might be channeled toward redevelopment goals. Ethnographic data are presented from two metropolitan areas in a rapidly growing Sunbelt state, identifying low-income and minority community perspectives on local banking practices, and recommending specific steps that banking organizations can take to address issues of affordable housing and credit to small businesses in the name of inner-city redevelopment.