New business helps marginalized communities reach financial security

LOUISVILLE, Ky. (WAVE) – Kentucky’s first Black community development financial institution opened Wednesday, November 6 in Louisville’s Parkland neighborhood. It is designed to provide essential financial resources.

One thing highlighted several times is the financial literacy and wealth gap hasn’t closed. John Howard Shaw-Woo, the interim CEO of Noir Lending CDFI Inc., explained a person with a lower credit score will pay an upwards of $1 million compared to someone who has a 700 credit score.

Noir Lending CDFI was created out of a need, such as when people need small loans for car repairs but don’t have the credit to go to a traditional bank for a loan. It’s the type of need that could make people feel trapped between a rock and a hard place.

Shaw-Woo says their business stands in the gap. An assessment of Kentucky showed them that credit building is greatly needed in the black community in Louisville.

Nationally, multiple reports show that Black people applying for mortgages have a denial rate of around 25%. Officials say Louisville has been making progress, but the hardest part for some residents is knowing where to begin.

“Every day I get questions working in the finance industry,” said Kenneth Gray, Noir Black Chamber of Commerce Inc. Board Chairman. “‘What do I do? How do I save money? What is credit? How do I build credit? Do I have credit? I want to buy a home. How do I buy a home?’ I calm them down and say let’s tackle one thing at a time.”

When asked what his ideal client looks like, Shaw-Woo said, “Anyone who has credit issues and has been denied a loan at a normal bank.”

Here’s how it works. Banks lend to Noir for them to lend out to clients. The focus is trying to help the Black and Hispanic community as well as others who need that credit assistance.

Noir Lending CDFI is located at the Nia Center at 2900 West Broadway.

Copyright 2024 WAVE. All rights reserved.