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When Billie Simmons needed to change her name on her bank card, she visited the financial institution to make the request. For some, it would have been merely an inconvenience, as the banking industry is legally bound to prove people are who they say they are. But for Simmons, it effectively meant outing herself as a trans woman to a bank employee. Nor did the name change end all her banking headaches.
Simmons secured a new card with her name, but was unable to update her username to access her digital account. Banks are known for running on dated technology platforms that make even small requests often impossible to resolve in a timely manner. “Every time I logged into my banking platform, I had to deadname myself, which is to use the name that I used before I transitioned,” Simmons says. She also received emails from her bank that used her former name.
“These are really emotional things for trans people,” Simmons says. “These are painful reminders of their history they really want to avoid.”
There are many banking products trying to make financial services more accessible, but persistent service gaps can still make the experience lousy at best and discriminatory at worst for some — including the at least 20 million lesbian, gay, bisexual, transgender and queer or questioning adults in the U.S.
People who fall under the LGBTQ+ umbrella often face a number of added complications when it comes to finance, such as having less financial support and therefore taking on more debt, or same-sex couples being denied mortgages at a higher rate than heterosexual couples.
“This is clearly a group with specific needs from financial institutions and those needs are not being fulfilled,” says Tyler Griffin, co-founder and managing partner of Restive Ventures, a venture capital firm that invests in early-stage fintech companies.
That stands to change thanks to an emerging area of digital banking that is rethinking the conventional rules. Banks, credit card companies and fintech startups are flexing their brainpower and willingness to improve banking services to win over an underserved LGBTQ market with an estimated combined buying power of roughly $1 trillion.
Why is LGBTQ-friendly banking important?
In a 2018 study by Experian, 62 percent of LGBTQ+ respondents said they experienced financial issues because of their sexuality or gender identity. While progress has been made in terms of LGBTQ+ rights and acceptance in some regards, LGBTQ+ individuals still have unique needs and concerns that someone outside the community might never worry about.
For example, a 2019 study published by the National Academy of Sciences analyzed extensive mortgage lending data and found that same-sex couples were about 73 percent more likely to be denied a mortgage application than heterosexual couples. LGBTQ+ individuals may face limited access to loans and mortgages due to discrimination or bias.
Discrimination isn’t the only concern for LGBTQ+ individuals. They may need specialized financial products and resources, such as adoption financing for same-sex couples. Transgender individuals, meanwhile, may require specific financial support for medical expenses related to gender-affirming healthcare.
There’s also a level of cultural competency needed to understand some of the concerns of LGBTQ+ individuals that differ from the general population. Challenges related to legal name changes, transitioning expenses or estate planning for chosen family structures are a few unique needs that staff of LGBTQ+ friendly banks may be trained to understand and help with.
LGBTQ+ friendly features to look for
When evaluating the LGTQB+ friendliness of a financial institution, some features and policies to consider include:
- Non-discrimination policies: Look for institutions that have explicit and forward-thinking policies prohibiting discrimination based on sexual orientation and gender identity. These policies should be clearly stated and encompass all services, including lending, account opening and employment.
- Employee resource groups: These groups provide a platform for LGBTQ+ employees to connect, share experiences and contribute to creating a better-adapted environment for both employees and customers.
- Support for LGBTQ+ community organizations and events: LGBTQ+ friendly banks actively participate in and sponsor LGBTQ+ events and initiatives, whether that be donating to a related cause, funding research on LGBTQ+ health disparities or sponsoring LGBTQ+ workshops. This support not only shows the institution’s commitment to supporting the community, but also helps advance understanding and betterment for LGBTQ+ issues.
Banks and credit unions that are LGBTQ+ friendly
If you’re looking to open an account with a financial institution that supports LGBTQ+ people and reflects that in its features and policies, here are some options to consider.
- Element Federal Credit Union: Based in West Virginia with nationwide online banking access, Element FCU works with members to print any debit or credit card with their preferred name. Any time a new account is opened, the credit union donates $50 to Rainbow Pride, a nonprofit supporting the LGBTQ+ community of West Virginia. An additional $0.05 is donated for every debit card swipe.
- Superbia Credit Union: Superbia is designed specifically for LGBTQ+ individuals. Its stated mission is “to provide discrimination-free banking, life and health insurance, and money management services that fully consider the needs of our LGBTQ community.” In addition to offering an array of banking products, Superbia manages a charity called Superbia Foundation that funds LGBTQ+ research and programs — 10 percent of the credit union’s revenue is donated directly to the foundation.
- Amalgamated Bank: Known for its commitment to social and environmental issues, Amalgamated Bank has clear policies to support LGBTQ+ customers and employees. The bank has a Pride Employee Resource Group, includes gender-affirming surgery and hormone therapy in its staff insurance policy and has signed on to a number of LGBTQ-related causes, including the Equality Act.
- BMO Harris: In 2021, BMO Harris launched its Zero Barriers to Inclusion program, with the goal of having at least 3 percent of its workforce identify as LGBTQ+ individuals by 2025. It was also the first bank to offer a debit card that allows customers to use their chosen name on the front of their cards without a legal name change.
- Capital One Bank: Capital One sponsors a number of events and organizations in support of the LGBTQ+ community. It donated over $150,000 to the Trevor Project, a nonprofit focusing on suicide prevention among LGBTQ+ people, for Pride Month. It also cited having 3.7 percent of its employees identify as LGBTQ+ as of 2021.
- Citibank: Citi has recognized and offered benefits to same-sex partners before they were legally recognized. In 2021, Citi signed the Business Statement Opposing Anti-LGBTQ+ State Legislation proposed by the Human Rights Campaign. It also offers easy services for customers to change the name on their debit or credit cards to their preferred name.
For the LGBTQ+ community, access to non-discriminatory and supportive banking services is vital for their financial stability, safety and ability to achieve life goals. By choosing an LGBTQ+ friendly bank or credit union, individuals can align their financial choices with their values and contribute to ensuring that all people are treated equally in the financial services industry. Make sure to research the financial institution before opening an account to confirm that its policies are representative of its mission.