Facebook has Announced changes to support Black-owned beleaguered Businesses.

On Wednesday, Facebook announced that it would be launching initiatives that will help support black-owned businesses.

As a result of this initiative, Facebook would be dedicating $40 million from its $100 million which is for the small business grant program, to Black-owned businesses in the U.S.

The grant has an inclusion of $2,500 in cash and a $1,500 Facebook ad credit. The Business Nearby feature which was announced by Facebook in May would be updated to enable Black-owned businesses to get discovered easily.

For the eligibility of this initiative, the companies must be a majority Black-owned for-profit enterprise that has up to 50 employees and has had its business operations running for at least a year.

Also, to benefit from this initiative, the business ought to have faced some setback from the coronavirus pandemic, and should also have plans to use the funds to boost their business and support their community.

Businesses that will apply for this fund will be examined by Facebook’s strategic partners, which includes Accenture and the Association of Enterprise Opportunity to ascertain which business is eligible to gain access to the fund.

With this recent initiative from Facebook, it will be in line with its contribution to this particular business sector. Back in June, Facebook set aside $200 million from its $1.1 billion supplier diversity program to Black-owned businesses which would run for a period till the end of 2021.

According to a study by the Federal Reserve Bank of New York, 41% of the 1.1 million Black-owned businesses on Main Street shut down between February and April as the coronavirus pandemic affected the country. This is double the failure rate of nonminority businesses.

Most often these businesses don’t have access to certain financial assistance which includes access to bank credits. Because of this challenge, they find it very difficult to withstand the financial crisis that they need a bailout from. Some of these businesses didn’t also get a share of the Paycheck Protection Program loan relief when it was been given to aid businesses.

Black-owned businesses are located in some major cities that have been struck hard by the coronavirus pandemic. For some of these businesses, their financial status before the break out of the virus was weak and couldn’t sustain them.

Facebook’s global chief diversity officer, Maxine Williams said, “We realize critical support for Black entrepreneurs is needed now… Helping these businesses stay alive and thrive is a way to promote economic justice and equality.”

There has been no request from Facebook for any business owner to identify themselves by race. Williams added “Many people don’t even know what businesses in their community are run by Black entrepreneurs… This will provide a way for consumers to find and support them.”

This new initiative from Facebook will help businesses get discovered and the company will also protect the privacy of people and their business, so it can be safe.

The diverse-owned business information can be skipped or edited by business page admins at any point in time that they feel like, and the diverse category labeling would not be displayed on the page for everyone to see.

The diverse business category on Facebook would not be associated with people, but pages. The idea of people’s race, gender, or ethnicity would not also be given when interactions are being made.

This method adopted by Facebook is in a bid to make valuable changes that would be beneficial to the entrepreneurial sphere which has been facing a lot of setbacks. Facebook's decision to come to the aid of entrepreneurs who are doing so much to push their businesses online and take advantage of the digital space, will prove to be a sort of redemption for them and also help them have an easy experience as they build their businesses online.

In recent times, Facebook has also had questions thrown in its direction about the absence of diversity around its employee base and its relationship with small businesses.

Facebook CEO, Mark Zuckerberg addressed this on its recent call earnings saying “Now some also seem to wrongly assume that our business is dependent on a few large advertisers. Now, while we value every single one of the businesses that use our platforms, the biggest part of our business is serving small businesses.

Facebook has also started receiving applications for the $25 million grant program which is to support the up and coming Black creators on both Facebook and Instagram in the U.S. Black creators will be provided with access to education, funding, development resources and community activities that will grow their communities and also build a business.

From the breakout of the coronavirus pandemic, Facebook has pushed out programs to support Main Street. In May, Facebook Shops was launched to make it easier for businesses to list their products on both Facebook and Instagram.

Facebook COO, Sheryl Sandberg, in a recent CNBC Small Business Playbook virtual event acknowledged the challenges that minorities are facing, which includes black women, as the current pandemic is plaguing societies, she said: “We want to give these people the best shot to continue to grow and serve their local communities.”