For founder Khalid Parekh, there’s an unusually strong incentive to make sure his startup, which publicly launched today, doesn’t stray too far from its goal of creating financial products for underserved communities: 90% of the investors that invested in his $20 million raise are immigrants and minorities—the people who Parekh aims to serve. The news of Fair’s public launch was first reported by TechCrunch.
Parekh, previously the founder and CEO of AMSYS Group, also brings his own experiences as an Indian immigrant to Fair. He came to the US in the late 1990s with only $100 before founding AMSYS Group, which was valued at $350 million.
Located in Houston, the most ethnically diverse city in the US as of the last census, Fair hopes to provide “ethical, transparent banking” to anyone through a membership model that doesn’t include banking fees. A $99 one-time membership fee, payable in full or partial payments, gives members access to all of Fair’s financial services.
The platform operates with Coastal Community Bank as its sponsor bank. It will allow customers to purchase homes with down payments, and a model that will split ownership of properties between the member and Fair’s LLC and allow members to purchase remaining shares of the house on whatever schedule they prefer. Fair is also offering free suplemental life, accident medical and AD&D insurance to all members in partnership with Avibra.
Parekh told TechCrunch he saw a lack of options for immigrants and low-income parties for insurance and retirement needs, and wanted to create a platform that was fair for all people and didn’t factor in religion, race or net worth. He recalls a lack of welcome from banking institutions when he first came to the US, saying to TechCrunch, “I was an engineer by background, but was very confused with the American banking system. There is not a lot of help for immigrants who don’t understand it well.”
The platform is available in English, Arabic, and Spanish, with more languages to be added soon, according to TechCrunch. Parekh, who is not drawing a salary for his role as CEO, says his goal for the platform is to address longstanding racial income inequalities. Fair also offers the following banking features:
- Free international transfer
- Early paycheck access
- Debit card accounts for kids
- Interest-free loans for home, auto and business
- Instant and interest-free microloans
Fair promotes socially responsible investing through reduced exposure to companies with negative social impact. It also utilizes ESG investing, a practice for measuring investment sustainability through impact in environmental, social and corporate governance. 2.5% of profits will be donated to United Nations High Commissioner of Refugees and World Relief missions, to assist refugees and racial economic empowerment movements.