NEW YORK—A new study shows there is a large difference in credit scores when broken down by race.
A report from Shift, a credit card processing company, found the following average FICO scores in 2021: Asian, 745; White, 734; Hispanic, 701; Black, 677, U.S. News and World Report said.
“Then there's the issue of credit invisibles, or people with no credit history or report at any of the three bureaus. A thin credit file appears riskier to lenders, resulting in credit denials or higher interest rates for the borrower,” U.S. News and World Report explained.
Roughly 15% of Black and Hispanic consumers are considered credit invisible, compared with 9% among white and Asian consumers, according to the most recent CFPB data. An additional 13% of Black and 12% of Hispanic consumers have unscored records, compared with 7% of white, the report shows.
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