♪♪ ♪♪ ♪♪ >> Wole Coaxum, the founder and president of MoCaFi, next on "The Chavis Chronicles."

>> Major funding for "The Chavis Chronicles" is provided by the following.

At Wells Fargo, diverse representation and perspectives, equity, and inclusion is critical to meeting the needs of our colleagues, customers, and communities.

We are focused on our commitment to diversity, equity, and inclusion, both inside our company and in the communities where we live and work.

Together, we want to make a tangible difference in people's lives and in our communities.

Wells Fargo -- the bank of doing.

American Petroleum Institute.

Through API's Energy Excellence Program, our members are committed to accelerating safety, environmental, and sustainability progress throughout the natural-gas and oil industry around the world.

Learn more at api.org/apienergyexcellence.

Reynolds American, dedicated to building a better tomorrow for our employees and communities.

Reynolds stands against racism and discrimination in all forms and is committed to building a more diverse and inclusive workplace.

At AARP, we are committed to ensuring your money, health, and happiness live as long as you do.

♪♪ ♪♪ >> We're very honored to have in our presence a financial genius.

Wole Coaxum, welcome to "The Chavis Chronicles."

>> Well, thank you very much for having me.

It's such a privilege to be on your show today.

>> Well, you know, they say that good things come out of Cleveland, and I know that's -- Tell us about your background, family background.

How did you get into the financial services industry?

>> Oh, so Cleveland is where I grew up, and it's a wonderful community.

But my story really started in Charleston, West Virginia.

And, so, on my mother's side, my great grandfather, her grandfather, with a sixth-grade education, decided to use his platform to create financial mobility for the Black community in the Jim Crow South.

And he was able to -- >> In West Virginia.

>> In West Virginia.

>> Must take a lot of courage.

>> Very much so, very much so.

And as a child of slaves, he then decided to go into the real estate business, and out of the real estate business, he ended up building a building just for Black entrepreneurs so they would have a place to go.

And he was early, we were.

We bought the equipment, he invested in the businesses, and from there he used his platform to integrate the library.

He brought Brown v Board of Education against the Board of Education, and he used that platform to integrate the public library.

And from integrating the public library, he was able to integrate the restaurant at the airport.

And his children picked up on that legacy.

His son was the first Black judge in the state of West Virginia.

And he always was thinking about, how do we move the community forward?

So, in my life as a young person, I was very much influenced by those stories and thought, how can I have an impact in my community?

So you fast forward to being a senior in high school, and I was sitting on my couch waiting for the fall to come to go to college.

And one of the counselors called me and said, "Wole, what are you doing for the summer?"

And I said, "I'm just hanging out, waiting."

And she said, well, there are some people who would like to offer summer internships to individuals at J.P.

Morgan."

So I said, "Great."

So the summer of my senior year after high school, I ended up taking an internship at J.P. Morgan.

And that was the beginning of how I got to Wall Street.

But always in the back of my mind was this understanding of economic mobility, trying to help move the community forward.

>> Sounds like you need to write a book about your family.

>> [ Laughs ] Yes.

>> But, you know, having that consciousness... >> Yes.

>> ...of the importance of financial management, financial literacy at the early age... >> Yes.

Yes.

Yes.

>> ...I mean, that's rare right out of high school.

You wound up working for one of the major banks.

>> Yeah, I was just really just good -- good luck, right?

And quite frankly.

But I was reflecting on it last Wednesday.

I had an opportunity to ring the bell at the New York Stock Exchange.

And it was coming full circle for me.

Where here I was 25, 30 years later, being able to ring the bell at the New York Stock Exchange, having started my career at 18 years old with an internship, and it was a good reminder for me of the importance of exposure.

>> Congratulations.

>> Thank you very much.

>> You know, that's a pivotal moment to get to ring the bell on Wall Street.

>> Yeah.

It was very special.

>> So tell us now what you're doing to enhance, to inform financial literacy, particularly for communities of color, particularly for African-Americans.

>> Yes.

>> So let's go into that.

>> Sure.

I was very fortunate to spend almost 25 years working in financial services, big banks.

And I had my George Floyd moment after the death of Michael Brown.

And I was watching those images, as we all did in 2014, seeing a community in pain.

And I thought to myself, how can I be helpful in addressing that issue?

And I thought that the economic mobility agenda was a necessary complement to the social movement that was going on in Ferguson.

And at that time, I was a managing director, one of the most senior Black people at J.P. Morgan.

So I quit my job and I decided, how can I figure out how to use my time and talents to have an impact on the situation I saw, which was the lack of economic opportunity.

So I started Mobility Capital Finance, which is we call MoCaFi.

And what we figured out over the last couple of years is it's important to make sure that individuals have access to resources efficiently.

And it became really important during the pandemic to make sure that people had access to, whether it was the PPP loans, whether it was the other resources, whether it was monies related to rental assistance.

And, so, we made it very efficient for that, for those dollars to get to people.

We did it in Birmingham.

We did it in St. Louis.

We did it in New York.

Did it in Los Angeles.

And what we figured out was, if we can make it easy for people to get resources, they can move their families forward.

But we also realize that it's important to get people access to financial literacy and financial education at the same time.

>> What is the mission of MoCaFi?

>> The mission of MoCaFi is to make it easy for individuals to get access to resources electronically and use that as a stabilizing force so they can open up bank accounts, they can build their credit, and they can go on and create wealth.

>> Well, you know, there's a digital divide in the Black community.

>> Very much so.

>> And I would say a technology divide.

>> Very much so.

>> So how does MoCaFi try to overcome some of the disparities when it comes to technology, when it comes to Internet, when it comes to online?

>> Yeah.

So we have addressed the issue where, if you look at the number of banks that have closed their branches, most of them have been in low- and moderate-income communities.

So what we figured out was, let's create a banking infrastructure that addresses the banking deserts that exist.

So what does that mean?

We were able to turn stores such as Walmart and CVS and Duane Reade into bank branches, where you can go in and you can put a deposit into your account with cash, as if you were going into a traditional brick-and-mortar bank.

>> So, we've heard about food deserts.

>> Yes.

>> Now you're bringing up banking deficits.

>> Very much so.

>> Deserts.

What led to the phenomenon of banking deserts in our communities?

>> What ended up happening was you've got a lot of banks who started out with key missions to support low-income communities.

And over time, the pressure to grow has enabled people or changed people's focus in terms of moving up market.

And, so, moving away from that particular customer.

At the same time, you have the entity -- You have the government actually used to be the biggest provider of banking services through postal banking.

And then, in the 1960s, that went away when banks were able to change interest rates and to move the deposits away from the post office into the more traditional banks.

And, so, then you've had the consolidation of a lot of banks.

At the same time, people looking for more and more earnings.

And as a result, you have created these banking deserts.

And, so, the emergence of technology has made it such that we can reimagine moving back into communities and saying, you know what, that deposit that had to happen or traditionally happened at a bank branch that might cost $4 or $5, now you can do for $0.25 if someone takes a picture of their check and they have it deposited in that bank account.

And, so, the opportunity is to reimagine, how might you look at someone who might have more month than money and turn them into a customer that can be profitable?

Because that's the big issue.

If somebody doesn't keep a big balance in their account, it's hard for a traditional bank to make money.

But if you use technology, now you have an opportunity to potentially have a profitable customer.

>> I want to focus for a moment on bank accounts.

>> Yes.

>> Some years ago, there were over 54 million Americans that were unbanked.

>> Yes.

>> Now, I know that number has come down now to about 5 million.

>> Yes.

>> But what does it stand in the Black community?

What is the percentage of unbanked brothers and sisters?

>> Yeah.

So I think about it's the unbanked folks in our community, it's about 15, 20%.

>> That's still high.

>> It's still very high.

And I think about it in terms of unbanked and underbanked together, it's close to 50%.

>> Okay.

What is underbanked?

>> So, underbanked means that someone has a bank account, but they actually rely on the check casher or the pawn shop or the payday lender for their core banking services.

And that's because they may have a credit score that doesn't lend itself to getting a credit card or a loan from a traditional bank.

They may live in a banking desert where they don't have a branch close by, and the closest thing is a check casher.

And, so, it's really those two populations together.

It's a really interesting statistic around the average African-American can spend in excess of $40,000 in his or her lifetime on excess banking fees.

You know, the check cashing.

>> $40,000.

>> $40,000.

And so you just imagine, if you're able to bring somebody a low-cost, high-quality bank account that moves themselves forward, that $40,000 -- I take it, it's over a lifetime -- but you can imagine that could be a down payment for a home.

Right?

And, so, as a result, you've got the opportunity in our community to bring low-cost, high-quality banking services that can move people forward so they are able to save that $40,000.

The other piece that we've really been focusing on is around, how can you use rent payments as a way to help people build credit?

So, in the last couple of years, an analysis was done of people who lived in New York City Housing Authority residents, and they took rent for people.

They took a subset, maybe it's 2,000 or 3,000 people, and took that rent payment and reported it to the credit bureaus.

What they found was just about everybody saw an increase in their credit score.

But the piece that was so compelling for me was, of the individuals who were thin to no credit file, 25% of them became 700 credit score or better.

So this idea -- >> 700.

>> 700.

So the idea that says an individual who, as a renter, we don't have good processes to make sure that rent is visible in someone's credit score, and if we're able to change the game on that, that opens up a huge opportunity in terms of people you can lend money to.

All the banks -- I couldn't find a bank that wouldn't want to lend money to someone who has a credit score of 700 or better.

And, so, just think about if we're able to take a large number of people, get them into the... Just that one piece opens up economic mobility for our people.

>> How do you take your innovation, your knowledge and get it out?

In other words, how do you distribute the knowledge that you have in financial literacy so people can get on board?

>> Absolutely.

And I think that is -- that's the key in terms of having an impact.

And what we've done in terms of our strategy has created something called On Our Block, and On Our Block is our ability to reach into communities.

>> That sounds friendly.

On Our Block?

>> On Our Block.

Because what we want to do is we want to bring the types of products and services that the mass affluent take for granted and bring it to our communities so you can have -- So what On Our Block is, is two things.

I'll give you a great example.

In St. Louis, where we operate, we actually have been able to provide good distribution of services for people in a universal basic income program there.

And the participants in that universal basic income program also have the ability to spend, once a month, a Saturday with us, and we bring a speaker, some food, and some financial literacy.

And we created a whole event to bring resources to the community.

We recognize that that's a face-to-face interaction.

We're taking it one step further.

We've created an app where people can get more financial literacy.

At the same time, they can have access to bankers, financial coaches, investment professionals on an interactive basis.

So we want to bring these kinds of tools to our community at scale with the education and the partners, because we recognize it's a very big tent.

One company can't solve this problem.

But if we work with a variety of companies who are committed to making sure that people have access to products and services that are safe, secure, priced appropriately, we can change the game.

>> So, Wole, in your senior year of high school, you were given an opportunity.

>> Yes.

>> How does MoCaFi today help spread those opportunities back to high school seniors, first year college?

What's your intersection, interaction with generation Z and millennials?

>> So, one of the things that we spend a lot of time thinking about is, is this kind of conversation which is passing along information.

So any opportunity that we have to share the story, be a role model, quite frankly, for people in terms of this is what's possible, it's important to be visible in the community so young people can see that there is a path that you can go down that may be a little non-traditional or entrepreneurial.

So, we also have summer internships where we hire young people and give them opportunity to grow.

And that works in everybody's benefit.

>> Summer internships, virtual or you have to be in person.

>> Both.

Well, we have -- I think the post-COVID has changed the game in terms of how people react and interact with work.

And, so, we're a team of about 40 people.

I would say about a third of the people are in the New York City area, and the remaining two thirds are all across the country.

So the nature of work has changed such that we can accommodate virtual or in-person.

>> Is the pendulum swinging in the right direction toward more inclusiveness of communities of color in the financial marketplace?

You are an expert.

What do you see as a trend today?

>> So, I think there is a key trend that's happening, which is a recognition that the Black community is an important economic driver of this country.

>> They say we spend over $1 trillion every 12 months.

>> And to that point, the opportunity, because we have so many people who are unbanked and underbanked, we are not fully taking advantage of investment opportunities.

We're not fully taking advantage of banking opportunities.

And, so, there is a multi-trillion-dollar series of assets that could actually move into the financial system, which can create greater revenue and earnings for a variety of financial services companies.

And, so, it's one of these opportunities with, as a business leader, you're constantly looking for new markets.

And, so, if you're able to find an untapped group of individuals who have spending power, who have investment power, and you can tap into that and bring them into the financial mainstream, all boats rise.

And, so, I think that there's a recognition of that and trying to figure out how to do it on a sustainable basis.

>> Why isn't financial literacy taught in the public schools of America?

>> It should absolutely be taught in the public schools.

It should be taught in the public schools in America, it should be taught in the private schools in America, the parochial schools.

Any place there is a young person, we should teach these concepts.

I'll give you a good example.

Two just personal examples.

One, I was having a conversation with my daughter recently.

She's 15.

And I said to her, "You know that the stock market is not connected to the reality in terms of what's happening in the economy."

And she said, "Why?"

And, so, we had a long conversation around what drives the stock market and what's happening on the ground in the economy.

And she said, "Dad, they're not teaching me this in school."

And she's in the 10th grade, right?

And this is very important information.

And, so, there is an obligation and a responsibility that we have as a society to make sure that the next generation and all future generations have understanding of that.

The other thing -- And I think we also have to take it upon ourselves to provide our best thinking on the topic.

So, the other thing we did as a family a couple of years ago was try to migrate away from Christmas gifts, and ended up opening up E-Trade accounts for each of our children and put a couple hundred dollars in and said, "You can pick the stocks that you want to invest in, but we're going to use this as a tool to educate you about the stock market.

Because I remember, even though I was fortunate enough to get the exposure early on at J.P. Morgan, I was still intimidated by the stock market.

So you fast forward seven years later, kids have experienced 100% to 200% return on their money.

The youngest one has found out the code to the E-Trade account, and she is putting in her own sell and buy orders.

And we have conversations now about why this stock is moving up, and why this stock is moving down and understanding how the stock market works.

So I just think we need to -- Because it's interesting.

As a community, we invest in the stock market at a lower rate than the broader society.

>> Why?

>> And I think part of it is it's lack of access, lack of understanding, lack of trust.

I could talk about my about my great grandfather.

He was a child -- No, he wasn't a child, but he was a young adult in the Great Depression.

And, so, when he passed away, he put everything into government bonds.

And as a result, that portfolio shrank.

And the money that he wanted to pass on to his future generations of family members was, A, the bank that he put the money in didn't fulfill their fiduciary duty, and the investments that he put this money in didn't grow faster than inflation.

So, we, as a community -- And you can even go back further.

The Freedman's Bank, right?

Our first opportunity as a community to put money aside was put into a bank that our communities thought had the backing of the US federal government.

It was poorly managed.

It went out of business within ten years.

And the -- I can't remember the exact number.

I think it was in excess of $1 billion in today's dollars had been deposited.

Those dollars disappeared.

And, so, from a very early opportunity, when we had a chance to put money into bank accounts, we put our trust and faith in institutions, and they failed us.

And that's carried over into an extended period of time in this country.

And as a result, we have that hangover, if you will, that we've got to work through to get more people into the fold.

>> Well, you know, trust is something you can't buy.

>> Absolutely.

>> MoCaFi is helping communities who have been distrustful of the financial services gain a little bit more trust.

>> Right.

>> What gives you your greatest hope for the communities in which you serve in terms of financial literacy?

>> Well, the greatest hope that I have is that I'm running my leg of the relay race, right?

Able to pick up on the legacy that you and your peers were able to drive and then be able to use that platform to move forward.

And at the same time, see young people coming behind who are equally as enthusiastic, to be able to say, "Okay, we've tried to make it a little bit better and created opportunities for access to capital, access to information.

Now we can pass the baton to that group."

And, so, I'm very excited about sort of where we are in terms of the business we're building and creating opportunities for people behind us to move it forward.

>> Wole Coaxum, founder and the CEO of MoCaFi, thank you for joining "The Chavis Chronicles."

>> Thank you for having me.

I greatly appreciate it.

>> For more information about "The Chavis Chronicles" and our guests, visit our website at TheChavisChronicles.com.

Also, follow us on Facebook, X, LinkedIn, YouTube, Instagram, and TikTok.

Major funding for "The Chavis Chronicles" is provided by the following.

At Wells Fargo, diverse representation and perspectives, equity, and inclusion is critical to meeting the needs of our colleagues, customers, and communities.

We are focused on our commitment to diversity, equity, and inclusion, both inside our company and in the communities where we live and work.

Together, we want to make a tangible difference in people's lives and in our communities.

Wells Fargo -- the bank of doing.

American Petroleum Institute.

Through API's Energy Excellence Program, our members are committed to accelerating safety, environmental, and sustainability progress throughout the natural-gas and oil industry around the world.

Learn more at api.org/apienergyexcellence.

Reynolds American, dedicated to building a better tomorrow for our employees and communities.

Reynolds stands against racism and discrimination in all forms and is committed to building a more diverse and inclusive workplace.

At AARP, we are committed to ensuring your money, health, and happiness live as long as you do.

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