In an opinion piece published in City AM last month, Charles Randell, former Chair of the UK Financial Conduct Authority and a member of the Financial Inclusion Commission, argues that financial inclusion is an essential aspect of sustainable economic growth.
While the UK market works very well for some, Randell explains, it extracts a "poverty premium" from others. "During my time as Chair of the FCA, I too came to realise that we cannot go on with a two-track system: with a globally successful financial services sector on the one hand, but millions of people at home who cannot access basic financial services on the other," he writes.
The Financial Inclusion Commission is publishing research into financial exclusion and wasted economic potential conducted by the University of Birmingham's Centre on Household Assets and Savings Management (CHASM). The findings show significant numbers of people with no bank accounts, debt, and lack of savings, with one in five adults borrowing more due to rising costs. Many, especially older adults, have struggled as the UK moved to digital-only services, lacking access to essential face-to-face banking.
Resolving these concerns will require government-led reform, Randell says, something the Labour government has expressed firm commitment to undertaking. "Greater financial inclusion will pay dividends," he concludes. "We look forward to the National Strategy unlocking collaboration across the four nations and between industry, policy makers, charities and the public sector. And above all, unlocking the potential of people across the UK to contribute to, and benefit from, economic growth."
For more from Charles Randell, don't miss his In Focus article from our 2024 Compendium, entitled “Cornerstone Questions.”
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