When the NFL needed to borrow $78 million recently, they opted to work with 16 Minority Depository Institutions (MDIs), CDFIs and women-focused banks.

“We saw this as an opportunity to have a direct economic impact on communities of color, especially at the local level,” Joe Siclare, executive vice president of finance and league policy at the NFL, said in an email. “These banks have a footprint in geographies across the country — including Houston, Chicago, Atlanta and more — many locations where NFL clubs are based.”

These loans are separate to the many banking relationships the league already has, including with USAA and Visa, which remain their official banking sponsors. The league worked with the Bank of America to choose the 16 mission-driven banks and consulted with the National Black Bank Foundation (NBBF), an entity that seeks to educate big businesses on impactful banking and offer technical assistance to MDIs on underwriting loans from large companies. The NFL will use the loans for general league business—not on a specific initiative.

“We work with the banks, explaining the opportunities,” says Ashley Bell, co-founder of the NBBF. “At the same time that we’re educating the NFL about MDIs and Black banks, we’re also educating the Black banks on how to understand and underwrite organizations like the NFL.”

Bell said since the death of George Floyd in 2020, the NBBF has “really been leaning into trying [to] going to those industries that make money off Black and Brown bodies and talent and helping them be impactful with their decisions on how they access the markets.”

The NFL is a fitting target of this effort as in 2021, about 71% of players in the NFL were people of color, according to the Institute for Diversity and Ethics in Sport at the University of Central Florida.

According to Brandon Comer, a managing partner of the Comer Capital Group which is a partner of NBFF, the deal illustrates the increased impact small, mission-driven banks can have when they collaborate.

“None of the banks, individually, have the capacity to lend such a large amount,” Comer says. “Because of the size of the institutions, they have lower lending limits and therefore we have to pull them together in order to increase that capacity to be able to lend in a size that would be able to effectually do such a transaction.”

The loan is also a saving grace for some of these institutions because it provides them with a solid customer. Bell says as interest rates rises, some customers may be hesitant to enter the marketplace or unable to repay a loan. A reduced clientele, or increased rates of defaulting on loans, will eventually hurt a bank’s profit.

“A lot of these banks are fragile, because the economies they serve are fragile,” Bell says. “Whenever there’s an economic downturn — the barber shop, the barbecue place shuts down, less money is coming into the churches.”

In addition to having another reliable customer, the 16 banks will profit off the interest fees from the loan.

“We treat it as tier 1 capital. For everyone $1 that the banks make off of this deal, [they] can turn into $10 that they can loan back out into these communities in the form of home loans, small business loans, supporting church loans,” Bell says. “And that’s what’s important. Is that it creates a profit generator for these banks that they can have up to 10x multiplied back into the community.”

The NFL is not the first sports league to move some of its money into smaller and minority-owned banks. In 2020, the NBBF acquired a $35 million loan from the National Basketball Association’s Atlanta Hawk to underwrite their sports medicine complex with financing exclusively from Black banks. Then, last year, the NBBF got a $25 million loan from Major League Soccer also exclusively with Black banks.

Such deals help serve as validation for MDIs, CDFIs and women-focused banks to businesses in their own community and the larger society.

“These [sports organizations] tend to be very high-credit, quality borrowers and that gives these smaller banks diversification in their loan portfolios,” Comer says. “And when someone sees ‘oh, these black community banks have done a deal with the NFL, they’ve done a deal with Major League Soccer’ they say, ‘oh, well, they could probably handle my business, or they have the ability to execute at a high level.’ And so it serves as a very strong validator. And we’ve seen business come to these banks as a result of that.”

In addition to supporting the financial institutions themselves, the influx of money could make an impact in the communities the banks serve as MDIs and CDFIs have a legacy of bettering their community—not just expanding their spreadsheets. Bell calls this impact banking.

“Every company has values but are you going to bank your values?” he says. “If you have a company that’s conscious about being good corporate citizens and community partners. Does your banking reflect that? Do you work with community banks? Do you put money in the banks that reflect your customer base? Impact banking is a move back, and we think this is another positive step in the trend of more corporations banking impactfully.”

This story is part of our series, CDFI Futures, which explores the community development finance industry through the lenses of equity, public policy and inclusive community development. The series is generously supported by Partners for the Common Good. Sign up for PCG’s CapNexus newsletter at capnexus.org.