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Study Finds Nearly Half of Gig Workers are Denied Access to Basic Financial Services

Argyle, an employment data platform that provides companies access to user-permissioned employment records in real-time, announced findings from recent research about the impact of credit scores as a sole or primary means of income verification for 1099 workers.

The Trends in Financial Access for 1099 Workers study gathered responses from over 1,200 gig workers, contract workers, and freelancers. Results reveal that the prevailing system of determining financial worthiness based on an individual’s credit score alone is overwhelmingly inequitable and insufficient for credit decisioning for this large and rapidly growing population. The findings also demonstrate that empowering this class of workers with their own employment data opens new possibilities for them to access vital financial resources that are currently out of reach for many due to legacy credit evaluation practices. Respondents shared that the lack of access had direct negative impacts on their mental health, families, and ability to improve their lives.

Credit score-first income verification standards don’t only have harmful consequences for 1099 workers. They are also a barrier to increased revenue opportunities for the businesses and institutions that provide financial, insurance, and housing services, preventing them from serving the total addressable market in the gig, freelance, and contract economies. With the number of 1099 workers expanding each year, this limitation equates to a massive missed opportunity industry-wide to optimise revenue potential—one that can be remedied by incorporating employment and income verification to make credit evaluation more fair and accurate.

Gig and freelance workers are continually denied access to essential resources and services at alarming rates, leading to negative mental health effects and challenging implications for their families.

While many 1099 workers have the funds to be eligible for essential services, the current standards for determining financial eligibility is preventing them from proving their eligibility. Nearly half (48.9 per cent) of 1099 workers reported that they had been denied access to something they were confident they could cover financially, with 63.1 per cent stating that this denial resulted from a low credit score.

More concerning still are the impacts of such barriers to access for 1099 workers. Of those denied access to something they knew they could financially afford, 52.2 per cent faced negative mental health impacts and 42.9 per cent faced negative consequences for their families as a result of the denial.

Credit scores

Credit score alone is not sufficient for accurately measuring freelance and gig workers’ creditworthiness or ability to pay for financial services. Fifty-five per cent of 1099 workers look at their credit scores all the time, but only 36.3 per cent of gig workers know everything that goes into calculating their credit scores. Additionally, most gig, contract, and freelance workers (69.9 per cent) think that employment records more completely reflect their ability to pay than credit score alone.

Argyle’s research reveals that while many 1099 workers check their credit score often, the lack of transparency regarding what factors into their credit scores, as well as credit score’s inability to tell the full story of a 1099 worker’s income, necessitate a supplement to credit score checks. The vast majority of 1099 workers (71.6 per cent) and 74.2 per cent of gig workers specifically believe that approval decisions related to ability to access financial services, insurance, and housing should be evaluated on additional or different information besides credit score alone.

Income Verification needs to shift

Despite the growing number of individuals in the United States turning to gig and freelance work, non-W-2 workers are not granted the consideration they deserve by financial institutions.

Over ninety per cent (91.9 per cent) of gig, freelance, and contract workers believe they should be entitled to the same consideration by financial institutions as W-2 workers, as nearly half of these individuals have been denied access to resources and services, often with negative consequences.

“The growing population of U.S. 1099 workers is going through a struggle—being denied fundamental financial services that are core to modern life— based on how their employment is characterised,” said Shmulik Fishman, CEO and co-founder of Argyle. “There is a shocking discrepancy in treatment by financial providers between 1099 workers and W-2 salaried workers. We heard from survey respondents who experienced housing insecurity and even homelessness, who were denied services based on a mistake on a credit report, who couldn’t get their kids to school, couldn’t save a sick family pet, or couldn’t travel to get critical healthcare because they had been denied an auto loan. Yet, these same individuals overwhelmingly reported their confidence and ability to pay for these services.”

Fishman continued, “It’s a harbinger of worse things to come if an alternative is not made available to gig workers, freelancers, and contract workers to prove their clear ability to pay for services they need to properly support themselves and their families. Employment data should absolutely be considered when determining 1099 workers’ eligibility for financial, insurance, and housing services, as it is a vastly more accurate assessment of non-W-2 workers’ income and overall ability to pay. There is also a significant opportunity for many businesses and institutions to fully optimise their financial potential by better serving the 1099 worker population.”


  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

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