Last summer, after the killing of George Floyd and national protests, PayPal made a $530 million commitment to support Black- and minority-owned businesses and fight economic inequality.
In a conversation for Fast Company’s video series, “The Work in Progress,” PayPal CEO Dan Schulman and executive vice president of global sales Peggy Alford confirmed the company has increased its commitment to $535 million and discussed how the allocation of those funds is going.
“We invested in venture companies that invest in people of color, in Black-owned businesses and entrepreneurs to help that gap that exists as well,” says Schulman. “We’ve already put into place well north of $300 million today.”
The company has dedicated $15 million to a PayPal Empowerment Grant program, in direct support of Black-owned businesses. “Forty percent of Black-owned businesses were going under,” says Schulman. “So these grants—which were not loans—were one of the things that was like, ‘here’s money to get through this moment.'”
Alford says that they’ve also been soliciting feedback from employees about how to most effectively disburse the funds. “When we made the [original] $530 million commitment, what we realized is that we were going to need to rely on the expertise of our employees, [who] come from communities across the world.”
WATCH: How PayPal is actually closing the racial wealth gap
Schulman also discussed a 2019 initiative to boost the pay of the company’s hourly and entry-level employees, after realizing that many struggled to afford basic living expenses.
He and his team raised pay for the company’s most in-need employees so they met a net disposable income (NDI) goal of 16%, which would rise to 20% by the end of 2021. “I think financial health is a bedrock or a foundation of so many things,” says Schulman. “We decided that the minimum NDI inside the company needed to be 20%, because if we had 20% NDI, [an employee] could save and didn’t have to choose between putting food on the table or healthcare benefits.”
To achieve this goal, PayPal cut healthcare costs by 60%, raised pay, gave shareholder equity to all of its employees, and provided a company-wide financial education program to encourage healthy spending and saving practices.
Financial health and inclusion are part of the mission of PayPal—values that its leadership considers a moral imperative, he says, and which they hope will propel the financial-tech company to its goal of one billion users. “We need to step up, every one of us, because we don’t live isolated from the environments that we all live in and work in,” says Schulman. “We’re all part of the same community.”
He says he has been thinking about these standards since his first day in 2014. “The mission we defined . . . was basically ‘How do we help democratize financial services?’ Which basically is a fancy way of saying, ‘How do we allow everyone to manage and move money inexpensively, quickly, so that money management and movement isn’t a right for the affluent—but it’s a right for everybody?’ And our primary value is ‘How do we become a company that is more inclusive and supports diversity?’ Because our mission is diverse by its very nature.”
Alford says that Schulman’s approach to incorporating diversity is baked in. “One of the things that I really like about Dan’s leadership is that he views diversity as the representation you need in order to serve your customers well across the world. A goal that we have through this commitment is that it will inspire others to actually commit to capital, along with us. Not just words, but capital.”