Credit Where Credit Is Due: Women in the Collections Industry

Did you know….of the 140,000 professionals in the collections industry, nearly 70% are women?

Of course, it wasn’t always this way. In fact, before 1974, single women in this country couldn’t even get a credit card, much less forge a career in the credit industry.

Let’s take a step back and see how the role of women in credit has evolved throughout the years.

On the Labor Front

Women have always been a part of the U.S. workforce, particularly those in the lower socioeconomic classes. But it wasn’t until the 1960s that they were allowed access to the same job opportunities as men. The Equal Pay Act of 1963 guaranteed equal pay to women for equal work; however, although progress has been made, full achievement of that goal is yet to be realized.

“Most of the people I was dealing with were the owners of the company and were male. They thought I didn’t understand because I was female. I remember one man saying to me one day, ‘Little lady, that’s just not how it’s going to be.’” — Kim Lindgren, CCE, CGA

For example, a 2005 Bureau of Labor Statistics (BLS) report indicated that American women’s salaries were 62.3% of men’s earnings in 1979 and 80.4% of men’s earnings in 2004. By 2017, women’s earnings had increased to 82% of men’s earnings. (See chart below.)

Other income advancement milestones in the 1960s:

In 1967, “sex” was added to the list of protected categories for affirmative action benefits. (Although it wasn’t until the 1970s and early 1980s that these benefits were realized through the advancement of women into management, professional and technical occupations.)
In 1968, the Equal Employment Opportunity Commission (EEOC) held that the widespread practice of publishing “help wanted” advertisements that use “male” and “female” column headings violated Title VII of the Civil Rights Act.

“I think that, overall, women in business have it better today because of HR’s hypersensitivity to women being treated fairly.” – Janet Roberts, Plant Nutrient Group Credit Manager, The Andersons Inc.

Gimme Credit

While all these changes improved women’s income situation, they still did not have equal access to credit opportunities. Instead, a woman’s credit worthiness was judged in terms of her husband. Her only access to credit was in her husband’s name, not in her own. As divorce became more common in the 1960s and 1970s, this presented a significant obstacle for women who had been forced by circumstances to start over as unmarried women.

“When I first got into the (credit) industry, I was the only female credit manager at my company. I would go to credit meetings, where I was nearly the only female in the room. Credit management is more female dominated now. Females hold top jobs at many companies. Whereas before, you would never see a female Director of Credit. That’s just not true anymore.” — Kim Lindgren, CCE, CGA

To address this issue, Congress passed the Equal Credit Opportunity Act in 1974. This legislation prohibited credit discrimination on the basis of gender, marital status, race, religion, age, nation of birth, prior residence, or the receiving of public assistance. Although it took a while before the legislation translated into common practice, there were a few immediate results.

For instance, in 1975, the First Women’s Bank opened in New York. It was the first U.S. bank operated by and for women. For the next 14 years the bank stayed true to its purpose. During this time, however, it gradually became clear that there was no longer a need for a bank that catered exclusively to women.

By 1989, the bank had changed its name to First New York Bank for Business. The change was made partly because the bank’s directors believed that women were no longer being discriminated against by other banks. Bank Chairman Martin A. Simon stated at the time: ″The mission that the bank had to specialize in women because they didn’t have equal opportunity became anachronistic because everyone else was doing the same thing.″

While the bank’s purpose and name may have changed in 1989, half of its senior management was still comprised of women. (A claim that few, if any, banks could make at the time.)

The One-Two Punch

Of course, today women are just as likely as men to use credit cards or apply for a mortgage or business loan. And it was the combination of access to higher pay and access to credit that set the stage for today’s women to achieve financial success.

That success has extended to women working within the credit and collections industry itself.

Women in Collections

In what was once a white male-dominated field, women and ethnic minorities have made great strides. As stated earlier, women now comprise almost 70% of collections professionals in the U.S. And 40% of those women represent racial and ethnic minorities.

According to Josh Adams, Director of Research for ACA International, “The stereotypical image of a debt collector couldn’t be further from the truth. Women and people of color play a significant and important role at collection agencies nationwide.”

“I was a business major [in college] because I came from a family that thought that women could go to school for three things: nursing, education or business. So I became a business major because education would have been one of the very last things I would have been very good at, and nursing would also have been a horrible thing for me.” – Janet Roberts, Plant Nutrient Group Credit Manager, The Andersons Inc.

Last August, Credit Advisor magazine named its “20 Most Powerful Women in Collections.” This list included CEO’s, board members, attorneys and shareholders. Each of these professionals were recognized by the magazine not only for their personal success within their individual organizations, but for using their influence “to create positive waves of change that ripple through the industry.”

Take a look: