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VIEWPOINT: Capital One and Discover merger is a strategic investment in communities

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 Knollwood Community Center in Claymont Director Shirley Ibrahimovic

At the Knollwood Community Center, investing in our neighborhood is what we do. We operate as a place of safety, education and recreation for the residents of the Knollwood Community. With the simple goal of making Knollwood a better place to live, I wholeheartedly support the proposed merger between Capital One and Discover. This merger has the potential to bring much-needed financial services and support that will help our families build generational wealth and secure a brighter future.

Capital One has a proven track record of serving communities that have historically been overlooked by other financial institutions. With one-third of their branches located in low- and moderate-income neighborhoods, they have demonstrated a commitment to ensuring that all parts of our community have access to vital financial services. Over the past decade, Capital One has consistently ranked at the top for community development lending, with more than $59 billion in CRA-qualified loans. This includes substantial support for affordable housing, which is critical for families striving for stability and long-term security.

Discover, known for its no-fee offerings, will complement Capital One’s efforts by expanding credit access and providing more competitive options for consumers. The merger will enable Capital One to leverage Discover’s payment network, fostering greater competition in the credit card and payment processing industry. This is particularly beneficial for small businesses in our community, which often face higher costs and limited options. With enhanced competition, small businesses can negotiate better terms and access more affordable services within the payment processing industry, allowing them to grow and contribute to our local economy.

One of the most significant impacts of this merger will be on our families’ ability to build generational wealth. Capital One’s pioneering credit products for borrowers who are building or rebuilding credit, offered at lower rates and with fewer fees, have already helped many individuals improve their financial standing. As of March 2024, 69% of Capital One customers who started with subprime credit scores have achieved a prime credit score of 660 or higher. By making it easier for families to access credit and manage their finances, we are setting the stage for long-term financial health and wealth-building that can be passed down to future generations.

While some may express concerns about market consolidation, it is important to note that the credit card issuer market remains highly competitive. Consumers typically hold multiple credit cards from various issuers and can easily switch between them. A recent analysis by the Banking Policy Institute concluded that the credit card issuer market is far from concentrated when compared to other industries. This merger will just inject some much-needed competition into the market, ultimately benefiting consumers and small businesses alike.

In conclusion, the merger between Capital One and Discover is not just a corporate transaction; it is a strategic investment in communities like Knollwood. It promises to enhance financial inclusion, support small businesses, and help families build generational wealth. Now, I’m counting on our leaders in Washington to speak up in favor of this merger and take steps to build a better future for communities like mine nationwide.

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