About Minority Bank Deposit Program
The MBDP was created in 1969 in response to Executive Order 11458 (March 5, 1969), which established a national program supporting minority business enterprise. It was expanded under Executive Orders 11625 (October 13, 1971), and 12138 (May 18, 1979). The Competitive Equality Banking Act of 1987 (Public Law 100-86) and the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (Public Law 101-73) include provisions supporting the intent of the MBDP.
Under the leadership of President Jimmy Carter, on April 8, 1977 a memorandum for all Heads of Departments and agencies was signed. This document promoted the use of minority-owned enterprises by placing deposits in minority banks. The agency assigned to head this program was the United States Treasury Department. View the memorandum.
Potential deposits include federal agency deposits of public money, cash advances to federal contractors and grantees, and certain independent demand deposits, e.g. Postal Service deposits, and certificates of deposit (CDs).
Typical CDs include the non-appropriated funds of various military organizations (exchange or club funds), certain Department of Agriculture funds, and funds that the Bureau of Indian Affairs invests on behalf of Indian Tribes and Alaskan Native Villages.
MBDP financial institutions market their services to federal agencies as they would to any potential customer. MBDP participants should contact local, regional and national offices of federal agencies to determine if banking-type services are needed and can be established.
If a federal agency chooses to use a MBDP participant as a depositary, the agency must coordinate the banking-type arrangements with its headquarters office and the Fiscal Service.
The Fiscal Service certifies eligibility for MBDP participation, and maintains and publishes the roster of participating financial institutions. The roster is distributed periodically to federal agencies, State and local government agencies, private sector enterprises, and minority banks.
Policy responsibility for the MBDP rests with the Fiscal Assistant Secretary of the US Department of the Treasury. The Bureau of the Fiscal Service (Fiscal Service) is responsible for coordinating the program within the federal government. The Department of Commerce's Minority Business Development Agency (MBDA) is responsible for developing minority business enterprise efforts with the private sector.
Last modified 08/30/19