Financial Inclusion: Improving the Financial Health of the Nation
This report evaluates the financial inclusion landscape in the United Kingdom (UK) and provides recommendations to develop a financially inclusive UK where every adult and child can enjoy decent financial health. It states that nearly two million adults do not have a bank account and about 8.8 million citizens in the country are over-indebted. The report also highlights the main challenges in furthering financial inclusion which include the lack of a national financial inclusion strategy, lack of financial resilience, irrelevant and unaffordable insurance products, and the need for better financial skills. It provides a number of recommendations to solve these challenges including:
- Designate a senior minister as the government lead on financial inclusion, and financial capability;
- Ensure payment mechanisms are responsive to the needs of all consumers;
- Promote greater consistency and accessibility in identity requirements for opening a bank account;
- Enable the use of public sector and non-traditional data in credit scoring, with safeguards, to make access to financial services easier for excluded groups;
- Promote a more coherent approach to customer-focused debt advice through better coordination and clear regulatory guidance;
- Provide financial skills training from primary school through to retirement, including at key life stages and events.