New study highlights racial disparities in credit access and income

Black adults are more than twice as likely to be denied credit than their white counterparts, according to a study released by LendingTree.

The study, which analyzed multiple data reports published by federal agencies and leading nonprofits, found black adults were 44% more likely to be denied credit (44%) or denied or approved for less than requested credit levels (57%) than their whites (19% and 24%, respectively), regardless of income levels. The study also found the average income for black men was 33.7% lower than the income level of white men in the nation”™s 50 largest metro areas, while the average income for black women was 17.5% lower than that of white women.

Racial disparity also persists at a professional level. LendingTree reported that black professionals in the financial services sector earn an average income 36.9% lower than that of white people, while black educators earn 8.4% less on average than their white colleagues.

Furthermore, the average cumulative student loan debt borrowed by black undergraduate students who graduated was $36,919, which is 20% higher than the $30,731 borrowed by white undergraduates.

Still, some progress can be found. The median net worth for black Americans grew by 29% from 2013 to 2016 while white Americans saw their net worth increase by 17% during the same period.

“It’s encouraging that Americans are having these conversations more openly and with more vigor and purpose,” said Tendayi Kapfidze, chief economist at LendingTree.

“Highlighting these racial disparities shows that systemic issues have held back generations of our fellow citizens. It is ultimately to the detriment of everyone as the economy is deprived of our best efforts by denying opportunities to many capable people. The creation of these disparities was and is often government-sanctioned and enforced, and so they should be addressed via legislative remedies in addition to societal change.”