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Aug 6, 2020

How Race Can Affect the Ability to Bank

By Team Stash

A new Stash survey shows that one in five people believe their primary bank denied them financial products based on race, gender, and income.

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In recent months, businesses in the United States have begun grappling with America’s history of racism and inequality. 

And banks and other financial services companies, which often have a  troubled history when it comes to race, are no exception. 

In fact, it can still cost Black people and other people of color more to bank than their white peers—the average minimum balance in Black neighborhoods was $871 to avoid fees, compared to $626 in mostly white neighborhoods. Meanwhile, there is a persistent wealth gap between Black and white Americans. White households in the U.S. reportedly hold seventeen times more wealth than black households do. 

What Stash’s Survey Tells Us

A July, 2020 survey of nearly 10,000 Stash customers1 about their relationship to their primary bank outside of Stash showed feelings of mistrust when it comes to their main financial institution:  1 in 5 people said they think they’ve been denied financial products and services due to their gender, race, or income level. Among Black Americans specifically, the percentage jumps to 35%, compared to 17% of white Americans.

Roughly half of Black survey respondents (15 percentage points more than other racial groups) said they think that demographic factors affected how they’re treated by their banks. Over 20% of respondents also said they think that their bank has treated them differently based on income level.

At the same time, respondents suggested that banks can have an important role in helping people of color become more financially whole. When it comes to financial guidance, 15% of respondents said they feel that their banks don’t provide them with sound advice and education and 12% believe that their banks aren’t transparent with them.

More on financial inequality and the wealth gap 

And data shows that there is a difference between the way white and Black customers are more generally served by banks. Forty-seven percent of Black households are unbanked or underbanked, meaning that either no one in the household has a checking or savings account or that the household has an account at an insured institution but also has financial products or services outside of the banking system. Just twenty percent of white households are unbanked or underbanked.

At the same time, Black Americans earn less on average than white Americans do. White men in the U.S. earn an average of  $2.7 million throughout their careers, compared to Black men, who earn an average of $1.8. This number dips further for Black women, who earn an average of $1.3 million compared to white women who earn $1.5 million.

Banking with Stash2

While banks and other financial services alone won’t be able to solve the problem of the wealth gap or financial inequality, they are a critical part of the solution. With Stash, regardless of your background, you can get a checking account with no account minimums3, no overdraft fees4, and no monthly or annual maintenance3

Plus, with Stash, you can make sure you’re not falling behind when it comes to investing. On Stash, you can start investing in ETFs and stocks on Stash with any dollar amount. Stash also provides customers with education on personal finance and investing so that you can build a healthy financial home.

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Written by

Team Stash

1 This survey was conducted online within the United States by Stash using SurveyMonkey technology in July 2020. The survey was completed by 9,822 people. Of the 9,822 individuals: 59.04% (2,799) identified themselves as males, 39.78% (1,886) identified themselves as females, 0.49% (23) identified themselves as nonconfirming/non-binary, and 0.70% (33) did not disclose. 1,334 (13.67%) identified individuals identified as Hispanic, Latino or Spanish Origin, 5,844 (59.50%) identified as White, 2,193 (22.33%) identified as Black or African American, 542 (5.52%) identified as Asian, 221 (2.25%) identified as American Indian or Alaska Native, 49 (.50%) identified as Middle Eastern or Northern African, 115 (1.17%) identified as Native Hawaiian or Other Pacific Islander, 451 (4.59%) identified as as Other.
This material has been distributed for informational purposes only, and is not intended as investment, legal, or tax advice.
2Bank Account Services provided by Green Dot Bank, Member FDIC. The Stash Debit Account opening is subject to identity verification. Investment products and services provided by Stash Investments LLC, not Green Dot Bank, and are Not FDIC Insured, Not Bank Guaranteed, and May Lose Value.
3Other fees apply to the bank account. Please see the Deposit Account Agreement for details.
4Transaction is declined and no fee is charged.
Investment advisory services offered by Stash Investments LLC, an SEC registered investment adviser. Investing involves risk and investments may lose value. For more information, please visit
For Securities priced over $1,000, purchase of fractional shares starts at $0.05.

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