Most people are probably aware of the income disparities between men and women, a phenomenon that has been debated and researched quite extensively. But is there a gap between men and women when it comes to lending and credit scores? This is a difficult subject to gauge thanks to changes in regulations made by the Equal Credit Opportunity Act (ECOA) of 1974, which bars lenders from discriminating against groups based on their demographics, including race, color, nationality, religion, sex, age, and receipt of public assistance.
Although the information may not be readily available, we were able to make some determinations on credit scores and usage by gender from a 2020 report issued by Experian, one of the three major credit reporting agencies. The company published a major analysis of the issue, “Women and Credit 2020: How History Shaped Today’s Credit Landscape,” that broke down the gap between the genders as the third decade of the 21st century commenced. It remains the most recent detailed source available on the subject in 2024. Let’s take a look at the numbers for men and women and some historical background.
Key Takeaways
- As late as the early 1970s women faced many hurdles in accessing credit, being required to have male cosigners and large down payments to get loans.
- The Equal Credit Opportunity Act of 1974 prohibited several practices that restricted women’s access to credit and their ability to be financially self-reliant.
- The average credit score of the two genders was identical in 2020.
- Men and women carried essentially the same level of credit card debt.
- Men carried more debt than women overall, including in every category except student loans.
The Equal Credit Opportunity Act of 1974
It’s hard to believe that women weren’t allowed to take out a loan or apply for credit without a male cosigner as recently as the 1970s. What’s more, when buying a home they were typically required to make a larger down payment than male applicants with a similar credit history.
Even today, according to the National Association of Realtors’ “2023 Profile of Buyers and Sellers,” “women face discrimination in obtaining mortgages due to a lower income than men,” a product of the ongoing gender-based wage gap in the U.S. In 2023, on average, women earned 83.7 cents for each dollar earned by men.
Still, the ECOA was a major milestone in trying to end gender discrimination as it relates to accessing credit. The Experian report showed that credit availability and usage for women and men had become largely aligned as of 2020. The table below delineates the divergence in scores and the average debt balance according to type for men and women.
| Average Debt and Credit Metrics by Gender | |||
|---|---|---|---|
| Debt/Credit Metric | Men | Women | Difference for Women |
| Average credit score | 705 | 704 | - 1 |
| Total debt balances | $337,957 | $310,004 | - $27,953 |
| Mortgage debt | $211,034 | $192,368 | - $18,666 |
| HELOC debt | $ 47,017 | $ 42,746 | - $4,271 |
| Auto loan debt | $ 20,645 | $ 17,747 | - $2,898 |
| Student loan debt | $ 35,188 | $ 36,131 | + $943 |
| Personal loan debt | $ 17,716 | $ 14,780 | - $2,936 |
| Credit card debt | $ 6,357 | $ 6,232 | - $125 |
| Number of credit cards | 3.6 | 4.5 | + 0.9 |
Source: Women and Credit 2020: How History Shaped Today’s Credit Landscape
This isn’t to say there were no differences in how men and women applied for and used debt and credit. Men carried more overall debt than women, including across most debt categories. On the other hand, women carried more student loan debt and often had more credit cards.
704 and 715
The average credit score for women as of the fourth quarter of 2019 and the average consumer credit score in the U.S. for 2023
Credit and Debt for Women vs. Men
Any parity that does exist between men’s and women’s average credit scores is not entirely new. The numbers were similarly close in the mid-2010s, and both averages rose 10 points from the second quarter of 2015 up through the last quarter of 2019. In modern-day credit scoring models, however, there is no consideration of gender factors, thanks to the ECOA.
There were some differences in the Experian report in how men and women accumulated their ongoing debt. Overall, men had about 9% more debt on average than women: approximately $338,000 vs. $310,000 in total debt balances. This difference came from holding more debt than women in every debt category but one. Men held 9.7% more mortgage and home equity line of credit (HELOC) debt, 16.3% more auto loan debt, and, most strikingly, 20% more personal loan debt.
Women held slightly more student loan debt on average (2.7%) than men, and they also tended to have more credit cards, averaging 4.5 cards as opposed to 3.6 cards. When it came to credit card balances, the difference was just $125 between the genders (about 2%), which is not considered statistically significant.
Are the Average Credit Scores for Men and Women Different?
Not materially. As of 2020 women had an average credit score of 704, while the average score for men was 705.
What Is the Equal Credit Opportunity Act (ECOA)?
Passed by Congress in 1974 and signed into law by President Gerald R. Ford, the ECOA did its best to level the playing field when it comes to women’s access to credit. Prior to the law, women weren’t allowed to take out a loan or apply for credit without a male cosigner. Women were also typically required to put down a larger down payment when buying a home than men were.
What Is the Gender Wage Gap?
Women still earn less than men for comparable work, something known as the gender wage gap. In 2023, women earned 83.7 cents for each dollar earned by men.
The Bottom Line
Legislative changes in 1974 allowed for greater access to credit by American women, enabling them to take out loans and credit cards without relying on male cosigners or being unfairly penalized when taking out a home loan. As of 2020 women had largely climbed to credit and debt equity, achieving average credit scores that were identical to men’s.
The makeup of debt did differ between genders, with men taking on more debt for housing, cars, and other items, while women as a group took on slightly more student loan debt. Although the total average debt balance of men was about 10% higher than women’s, the identical average credit scores implied that there was a similarly responsible approach to the handling of credit across genders.
Article Sources
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Federal Deposit Insurance Corporation (FDIC). "Equal Credit Opportunity Act (ECOA)."
Experian. "Women and Credit 2020: How History Shaped Today's Credit Landscape."
U.S. National Archives. "On the Basis of Sex: Equal Credit Opportunities."
U.S. Department of Labor. "Equal Pay Day 2023: Department of Labor Initiatives Seek to Close Gender, Racial Wage Gap, Iincrease Equity in Federal Programs."
Office of the Law Revision Counsel. "15 USC Chapter 41, Subchapter IV: Equal Credit Opportunity."
Experian. "What Is the Average Credit Score in the U.S.?"
Board of Governors of the Federal Reserve System. "Gender-Related Differences in Credit Use and Credit Scores."
