How can banks and credit card issuers support the LGBTQIA+ community? Over the past few years, banks have increasingly celebrated Pride Month in June through a variety of initiatives. These include corporate sponsorship of Pride parades and events, limited-time rainbow brand logos or card designs, and social media posts that celebrate employees. This visible support has been welcome and long overdue for a marginalized community numbering more than 30 million in the U.S.
Yet Pride is a month-long affirmation of identity and celebration of progress in fighting for equal rights. And firms should recognize they’re engaging with an underserved population that continues to confront multifaceted social, legal and political issues, many of which directly impact our financial security.
Only 15 states explicitly prohibit credit discrimination based on sexual orientation and gender identity. The remaining 35 do not legally protect LGBTQ+ people from being unfairly denied credit and lending services. As of 2020, only 13 states ban healthcare discrimination against LGBTQ+ patients, though this number is encouragingly up from five states in 2010. A 2019 Morning Consult survey found that 25% of LGBTQ+ respondents say their gender identity or sexuality has negatively impacted their finances, whether from job insecurity, increased debt, lack of familial support or other structural issues. In the face of so much systemic discrimination, how can individual banks or card issuers directly support their LGBTQ+ customers?
Offer gender-affirming card names
Mastercard first launched its True Name initiative, which enables customers to request a card with their true first name without being required to identify their gender or provide a reason, during World Pride in 2019. This initiative stands out by addressing a clear need that impacts everyday financial interactions for nonbinary and transgender people.
Mastercard cited that “32% of individuals who have shown IDs with a name or gender that did not match their presentation reported negative experiences, such as being harassed, denied services, and/or attacked.” Although customers must still hold accounts in their legal name, being able to use a true name instead of a deadname without requiring a legal name change—as that process can be prohibitively expensive and cumbersome—enables an at-risk population to safely complete everyday card transactions. Point-of-sale identity confirmation improvements such as EMV chips and contactless technology should allow the service to become more widespread, as merchants no longer have to rely on matching card names to signatures or photo IDs.
BMO Harris Bank and Superbia Credit Union piloted the program as part of a slow rollout, but adoption began to pick up in 2020. In October, Citi became the first large credit issuer to implement True Name, enabling customers to list their chosen first name on any Citi consumer credit card. The feature does not yet extend to debit cards.
Citi improved upon the previous pilots—which required customers to update their names in person or over the phone—by allowing card holders to change their first names digitally. It offers a simple, user-friendly process on its authenticated site Contact Information page. The Preferred First Name lightbox also offers an option to order a card with the updated name, includes name parameters and outlines situations where the firm is still required to use a legal name. The seamless digital integration has resulted in high adoption, with more than 10,000 customers making a name change in the past eight months—including 1,600 in the program’s first two weeks alone.
This month, Mastercard announced it would make True Name globally available by taking a white-label approach in partnership with BM Technologies and Global Payments. This allows individual firms to seamlessly integrate the feature into their digital platforms. Since May, True Name’s adoption has exploded among challenger and community banks, with Bunq, Monzo, Republic Bank and others across Europe and the U.S. all implementing the feature.
Mastercard True Name adoption timeline
Provide financial planning and education
In December 2020, challenger Daylight—backed by Marqeta and Visa—opened its waitlist for the first digital banking platform designed both by and for the LGBTQ+ community. Daylight tailors services specifically for customers’ needs, including:
- Financial coaching to help plan for life events that may involve unique factors for clients, such as adoption or surrogacy, gender-affirming surgery or retirement
- Preset bucket options in its savings goals tool that reflect the above needs
- In-app educational content, including a personalized advice feed
- Opportunities to make direct donations within the platform to LGBTQ-aligned charities
- A debit card with customers’ chosen first names, the first Visa card to include this feature
Banks should especially take note of Daylight’s commitment to hiring coaches who are well-versed in the challenges LGBTQ+ customers may face. Many financial planning goals that are often seen as standard—getting married, buying a house, saving for college, retiring, etc.—may not align with their life journeys or may include complicated considerations.
Firms should at least prioritize making LGBTQ-specific financial education resources available on their digital platforms year-round. Of the large banks and card issuers evaluated by Corporate Insight, only two provide a dedicated public site resource center:
- U.S. Bank’s LGBT Resources microsite stands out for offering a multitude of easily findable, categorized resources that include personal stories, financial insights, community news and educational resources
- Wells Fargo also offers an LGBT Resource Center, though it mostly overviews corporate initiatives and includes little online content or support
Three other firms—Chase, PNC and SunTrust—offer support via online financial education resources. The scope, type and presentation of their resources vary. Only Chase employs the best practice of providing articles explicitly written by LGBTQ+ people. By using their high-profile platforms to amplify voices from within the community instead of speaking for the community, these firms share a clear example of allyship.
Advocate for change
Although it falls beyond the scope of Corporate Insight’s research, public advocacy is an important way banks and credit card issuers can support the LGBTQIA+ community. According to the Human Rights Campaign, firms that have pledged support for the Equality Act—which would bar employers, landlords, banks and more from discriminating against people based on sexual orientation or gender identity—currently include American Express, Bank of America, Capital One, Citi, Chase, KeyBank, Mastercard, PNC, TD Bank, U.S. Bank, Visa and Wells Fargo, among others. Even smaller banks have an opportunity to stand up for LGBTQ+ civil rights by speaking out against any state legislation in their operational region that harmfully targets transgender people.
Overall, firms can be consistent allies by taking steps to make current products and digital resources more inclusive as well as supporting long-term policies that make achieving financial stability more feasible for this underserved community.
For more coverage of industry movements, including innovative or inclusive services launched by traditional firms and challengers alike, check out our bank, credit card and fintech research services.