WASHINGTON -- Seeking to harness the purchasing power of the nation's 30 million African-Americans, a Baltimore group announced yesterday that it is teaming up with Key Federal Savings Bank and American Express to provide millions of dollars for black colleges.
The organization, America's Black Colleges, is promoting a Visa credit card issued by the Havre de Grace bank that will contribute a small percentage of each transaction to a fund providing scholarships and awards to 115 historically black schools, including five colleges in Maryland. Bowie State University, Coppin State College, Morgan State University, Sojouner-Douglass College, and the University of Maryland, Eastern Shore all stand to benefit from the program, which initially will provide scholarships only to students studying science and technology.
"Black colleges are under pressure as they haven't been in the past," said Shirley Chisholm, the former congresswoman who serves as a spokeswoman for the Baltimore group. "The focus here is on real black power -- dollars and sense. Money and minds are power."
"The America's Black Colleges program can help close the gap between scholarship needs and scholarship resources," Ms. Chisholm said at a news conference here.
Founded in 1988, America's Black Colleges is a nonprofit organization that promotes products and services from companies that donate a portion of their sales to scholarship funds.
Key Federal will contribute 0.25 percent of the purchase to the fund each time a charge is made. It also will donate up to $7 each time a new card is issued.
In conjunction with Key Federal, the American Express Corp. announced it is setting up the MoneyGram Scholarship Fund for Black Colleges with an initial donation of$10,000. A $1 contribution will be made when cash from the Visa card is wired through MoneyGram Service by American Express. Key Federal will also provide a matching donation.
"If hundreds of thousands of people converted to the Key Federal Visa, it could raise millions of dollars a year in scholarships," said Alvin Lee, executive director of America's Black Colleges. "The program represents economic empowerment because it can convert the over $300 billion of purchasing power of black Americans," Mr. Lee said. "This is a chance to make your credit card work for someone else."
Mr. Lee said he hopes that by the end of this year 50,000 cards will have been issued, with the goal of raising at least $1 million. Once the money is collected, it will be be distributed by the corporate sponsors, based on the recommendations of America's Black Colleges and Ms. Chisolm.
Henry Schreiber, vice president for card holder services of Key Federal, said that unsecured credit cards are available for those with good credit histories. For people who lack a good credit history, the card is also available as long as it is backed by a savings account with a minimum deposit of $350.
The interest on the savings account is to be just over 4 percent.