Glossary
What is the Equal Credit Opportunity Act (ECOA)?
The Equal Credit Opportunity Act (ECOA) is a federal law that makes it illegal for creditors to discriminate against applicants on prohibited bases such as race, color, religion, national origin, sex, marital status, age, or receipt of public assistance. It is implemented by Regulation B and requires adverse action notices.
What ECOA prohibits
ECOA prohibits discrimination in any aspect of a credit transaction on a prohibited basis and requires that applicants who are denied credit receive notice of the specific reasons (or how to obtain them).
ECOA and automated decisioning
Regulators have made clear that using complex models does not excuse a lender from providing accurate, specific reasons for adverse action. 'The algorithm did it' is not a defense — the lender must be able to explain the decision.
FAQ
ECOA — common questions
Who enforces ECOA?
ECOA is enforced primarily by the CFPB, with the FTC and other agencies playing roles depending on the institution. Private rights of action also exist.
The institution around the intelligence
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