PayPal Holdings, Inc. PYPL recently reinforced its stance against racial discrimination by pledging $530 million in a bid to support black and minority-owned businesses and communities in the United States.
Notably, $500 million out of the total committed amount will be entirely used in creating an economic opportunity fund, which will be focused on driving financial health, access and wealth creation for the black and underrepresented minority businesses.
Further, $10 million will be utilized in providing empowerment grants to businesses owned by the blacks that have been significantly hurt by coronavirus-led disruptions. This $10 million fund will managed by the company in collaboration with Association for Enterprise Opportunity.
Moreover, $5 million of the total amount will be committed to the company’s non-profit community partners that are providing microloans, technical assistance, mentoring and digital solutions access to the black-owned businesses. Notably, this $5 million fund will be utilized in funding program grants and employee matching gifts for these partners.
Meanwhile, the rest $15 million is pledged towards supporting recruitment, aiding equality and career opportunities for black and minority employees of PayPal itself.
PayPal to Benefit
We note that the latest move bodes well for the company as it takes a stand amid the strong protests against racial discrimination and economic inequality in the United States post the death of George Floyd.
Moreover, the $15 million out of the total amount has been pledged toward equality, recruitment and diversity within the company itself. This bodes well for the internal diversity of PayPal and is crucial to success in this era.
Further, the pledge will help the company in winning employee confidence, which in turn augurs well for its office operations and commitment toward the welfare of its employees.
PayPal Holdings, Inc. Price and Consensus
PayPal Holdings, Inc. price-consensus-chart | PayPal Holdings, Inc. Quote
Support to Black Community Gains Steam
By committing $530 million toward the support of black and minority community, PayPal joins the pack of other companies that are also taking strong stand against racial discrimination.
Apart from PayPal, companies like Bank of America and Goldman Sachs have pledged $1 billion and $10 million, respectively, to address economic inequality and promote racial equity.
Further, PayPal joins the pack of technology giants including Amazon AMZN, Microsoft MSFT and International Business Machines IBM, which have also taken aggressive stance against the racial discrimination.
Notably, Amazon and Microsoft have implemented moratorium on police use of their respective facial recognition software in order to promote racial equity.
Further, IBM will reportedly no longer sell or develop facial-recognition software in an effort to curb racial discrimination. Moreover, the company has opposed the use of such technology for mass surveillance and racial profiling.
Given the scenario, we believe PayPal’s latest move is likely to aid its brand reputation.
Currently, PayPal carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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