Ally Exec Outlines How Lenders Can Navigate the Challenges of Unintentional Bias

Reggie Willis, director of diversity and inclusion, Ally Financial

Though regulators have relaxed discriminatory lending rules, auto lenders are stepping up diversity education. Ally Financial, for one, is bolstering training efforts to reduce unintentional snap judgments based on race, gender, or appearance – a concept referred to as “unconscious bias.”

There are certain tactics lenders can put in place to avoid unintentional biases that can impact their business. “Expose yourself to things that you are uncomfortable with, educate employees, and create awareness,” Reggie Willis, Ally’s director of diversity and inclusion, told Auto Finance Excellence. “[Unconcious bias] is something we all have, but it’s about how [lenders] allow those bias to influence practices.”

In 2013 under former Director Richard Cordray, the Consumer Financial Protection Bureau issued the disparate impact liability under the Equal Credit Opportunity Act  — which prohibited lending based on an individual’s race, religion, sex or age. Today under Acting Director Mick Mulvaney, regulation has pulled back in this space.

In June, the Senate passed a joint resolution under its Congressional Review Act authority disapproving of the CFPB’s March 2013 auto lending bulletin that addressed discrimination in indirect auto finance transactions. This month, attorneys general cautioned the CFPB against reading disparate impact liability out of the Equal Credit Opportunity Act.

Regardless of compliance standards, it is vital for lenders and their dealer partners to maximize opportunities with consumers by avoiding unintentional biases. In this episode of The Roadmap, Auto Finance Excellence talks with Willis to discover what lending executives can do to become more open-minded and avoid having unintentional bias trickle into interactions between dealers and their car-buying customers.

Have any questions, podcast ideas, or looking to get involved? We’d love to hear from you. Please email ncasperson@royalmedia.com.

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