Next City, September 23, 2023, Banks Discriminate Against Black And Latino Small Businesses, Report Shows
A new report by National Community Reinvestment Coalition shows widespread discrimination in small business lending. The coalition sent testers to 34 New York City bank branches to evaluate disparities in small business lending and found that “bank staff were more cordial, affirming and helpful to white customers than to Black or Hispanic ones.” White testers were encouraged to apply for a small business loan more often than Black or Hispanic testers, “by a statistically significant margin.”
The group said it found 51 instances of anti-discrimination law violations in its testing. NCRC said in the report that there were few overt references to race during the meetings between lenders and testers, but that there was significant disparate treatment, ranging from less likelihood of standing up and greeting Black and Hispanic testers to lenders being more likely to discourage Black and Hispanic testers from applying for loans. NCRC recommends more widespread testing, as well as implicit bias training for lenders.
