DOVER – Investor Cash Management (ICM) now offers Delaware State University community members a new financial option that increases wealth and opens up new investment opportunities beyond traditional bank accounts.

Continuing the commemoration of the university’s 130th anniversary, ICM announced a partnership with DSU to offer free cash management accounts to DSU students, faculty, staff and alumni. Powered by API technology, the platform is designed to manage liquidity and earn high interest rates on bank accounts and investment products, such as government money markets and exchange traded funds.

The cash management account would jumpstart the wealth growth of DSU students with higher interest rates and provide easy investment opportunities. | PHOTO COURTESY OF DELAWARE STATE UNIVERSITY

“One way to think of it is like a benign Trojan horse. It will turn unbanked individuals into banks and turn banked individuals into investors, ”Fred Phillips, CEO of Investor Cash Management, told the Delaware Business Times. “The goal is to empower people to achieve better financial results for themselves and their families, and we wanted to change the narrative the same way DSU is now in terms of the way people think. historically black colleges and universities. “

Founded in 2018, ICM was launched with $ 6 million raised from venture capitalists and investors like MBNA co-founder and former Mastercard chairman Lance Weaver, Morningstar founder and chairman Joe Mansueto on the board of administration. Now with 30 employees, the Chicago-based fintech company recently closed a $ 10 million Series B fundraiser. In August, ICM announced a partnership with Visa and added co-CEO of Ariel Investments and chairman John Rogers Jr. to its board of directors.

Key to the ICM Experience is an all-in-one product that allows users to bank, save and invest in one account, providing quick cash like a checking account and high rates. high interest on investments. Interest rates for ICM accounts range from 0.55% for a bank account to 1.61% for a long term investment account. In comparison, the average interest rate for an FDIC account today is 0.03% for a checking account and 0.06% for a savings account.

ICM registrations are limited to wealth management or asset management companies, or partner organizations, which makes the DSU partnership more exclusive. ICM partners include PIMCO, SEICU Member Benefits, NEA Member Benefits, Foundation 99, Wisdom Tree and more, but DSU is the first HBCU to have signed with the fintech company.

With this partnership, the DSU leadership hopes to improve the financial literacy of its students, as the black community has always been plagued by economic inequality. A white family had at least 10 times the wealth of a black family, a gap that stems from the low number of homeowners, according to a 2019 Federal Reserve survey.

“[Our students] need more than their degree to change the economic trajectory for themselves, their families and their communities. They need to know how to build wealth, ”DSU Chairman Tony Allen said in a statement. “It takes planning, time and tools. We’ve already committed to comprehensive financial literacy training, and Delaware State University’s new CMA is offering our entire community a responsible financial product designed just for us. We hope that many of our sister institutions will join us as well. “

Fred phillips

Phillips was aware of the need for financial literacy because his mother is a Mexican immigrant who worked in a hospital in Houston.

While leading the technology and financial services for ABN AMRO and The Carlyle Group, he wanted to give people like his mother the tools to be successful with their investments, even with limited funds and an immediate need to spend them on them. necessities.

“If we can create a product that cuts these sources of friction like a Gordian knot, it should be a catalyst in turning people into investors and helping them achieve better bottom lines,” Phillips said. “We hope that DSU can be a hugely successful proof of concept that can speak for us when we can speak with a network of HBCU.”

Students and DSU staff who open an ICM account can manage their funds through a web portal or the smartphone app, and spend their money through a DSU branded Visa card.