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Three entrepreneurs — one Black, the other White and Hispanic — go undercover for an experiment. All dressed in matching khaki pants and polo shirts, they visit a few banks to apply for a small business loan. Who do you think gets the best assistance? (No prize for guessing!)

White business owners, unsurprisingly, got “better and more encouraging service,” Bloomberg Businessweek reports. Researchers Glenn Christensen, Jerome Williams and Sterling Bone found that loan officers were more likely to (a) ask a White entrepreneur if he needed help with his application, (b) tell them about the loan terms, and (c) give an in-depth explanation on fees.

As you might have guessed, also unsurprisingly, the Black and Hispanic business owners got the shorter end of the stick.

Bank employees were more likely to delve into the personal finances of minority entrepreneurs and less likely offer the minority spies a business card. When asked to describe their loan application process, “minority consumers framed the journey as uphill, while white consumers consistently framed their journeys as on level ground,” according to the researchers.

To give a visual description of process, the researchers asked the three groups to select a picture that best depicts their experience in applying for a loan. Minority entrepreneurs leaned towards photos of a dry faucet, a beggar, and a set of handcuffs. On the flip side, White entrepreneurs’ photo selection was a bit more scenic: a water slide and a beachfront idyll.

Before you dismiss the experiment as only anecdotal, consider the vast array of quantitative research support these findings. “In 2012, Federal Reserve data revealed that minority business owners were paying interest rates that were 32 percent higher than what whites paid for loans. Last year, research from the Kauffman Foundation showed that minority entrepreneurs were more likely to be turned down for loans and less likely to apply, for fear of rejection,” BusinessWeek added.

According to the researchers, entrepreneurs of color tend to recruit White employees on their team to increase their chances of getting approved for a small business loan. The result of this, according to the researchers, is “a cumulative debilitating effect on their psychological and physical well-being.”

Christensen, Jerome, and Bone’s study can be found in the Journal of Consumer Research.

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