Mighty Deposits Helps Individuals To Find Banks And Credit Unions That Match Their Values.
Impact investing in the form of mutual funds and ETFs have attracted a lot of investor attention in recent years. But another way of having your dollars count is by selecting a banking institution that is aligned with your values.
The good news is there’s now an online tool for individuals to find banks and credit unions that match their values. MightyDeposits.com helps people find any bank or credit union, anywhere in the U.S., that fits one or more of the 60-plus impact metrics.
The founders, Megan Hryndza and Sophia Wagner launched Mighty in January 2020 – about a month before the pandemic hit – on a bootstrap budget. But they had been working on the idea since 2016. And while they also got impacted by the global crisis as many small businesses did, the timing couldn’t have been better from a consumer awareness point of view.
“When there are crises, there is this a-ha moment of ‘Oh, community banks matter’,” said Hryndza. “And so, we didn’t anticipate that community banks were the heroes of the PPP (Payroll Protection Program for small businesses during the coronavirus pandemic). We didn’t anticipate that we would be the go-to resource for showing what banks were providing PPP loans. But because we now have this platform, we were able to set it up in a few days.”
Indeed, the most active impact banking institutions have been community banks or credit unions. That said, someone looking for what environmental, social or governance (ESG) impact their bank – any bank – has, can quickly screen this by filling out the bank’s name in a search box on the site.
Perhaps not surprisingly, many large banks such as JP Morgan Chase or Bank of America spend very little of customer deposits on community investments. While many large banks get wide coverage by the mainstream media about their green projects, regional and local banks rarely make the news despite their commitment to local communities.
“There’s a role for both institutions,” said Hryndza. “Global organizations, they do need global banks. But small businesses, have a lot to gain from small business banks. … I’m excited for the potential of some big banks to make stronger-than-ever impact commitments and really putting this as a core business strategy moving forward vs. a side thing.”
She said that Mighty’s role is to create bridges between people and banks. While banks are encouraged to submit ESG information to Mighty, consumers and small businesses can screen based on factual data that is gathered by this process. Some of the metrics include banks that don’t use deposits to fund fossil fuels, banks that share human stories behind the data, or women-owned banks.
For example, Southern Bancorp Bank makes $72 of community investments for every $100 you deposit, which is 60 percent above the industry average, according to Mighty. It ranks highly in several major impact areas, such as being sustainable (ESG), investing in low-income communities, above-average in small business lending, in housing lending, in small farm lending, in investing in public works, and in financing communities overall. Eighty-seven percent of its deposits are based in Arkansas, while 13 percent are in Mississippi.
If you screen for women-owned banks, there are only 11 across the U.S., despite women representing more than half of the population, noted Hryndza. “Which just makes you stop and think: ‘How does that happen?’ Women are half of the country funding the banking industry, but they’re not represented in terms of the control. So, we show that ownership and governance on Mighty.”
The National Bank of Malvern, based in Pennsylvania, is a women-owned bank. It makes $74 of community investments for every $100 you deposit, which is 66 percent above the industry average.
Because 100 percent of its money is based in its state, Mighty considers this concentration a positive for the local communities. The bank scores highly in investments for housing, large farms, small business, public works, construction, and small farms.
Mighty Deposits also has a nifty calculator where existing bank customers can enter their share of monies on deposit with up to four banks and calculate the overall impact of their bank portfolio. A similar calculator is also available for credit unions.
In addition, Mighty provides a variety of useful guides on various ESG topics and other impact subjects in the banking industry, such as eco-friendly banks, socially responsible banks, and African American and Hispanic-owned and led banks.
“ESG has really become a part of ‘how does this impact our customers’ and all companies want to be customer-centric,” said Hryndza. “We all have a shared interest in it. Let’s just call it ‘How is our company affecting the neighborhoods and the lives of the people who live there and the customers we serve?’”