The Challenge
Many people lack access to appropriate financial services, or simply lack the financial and digital knowledge in order to manage their money effectively. Being financially excluded can be a vicious cycle, as the under-banked miss out on deals that are only available online or through direct debit payments, and often struggle to access the credit needed to make investments, such as buying property. On top of everything else, financial exclusion has implications for people’s everyday wellbeing and mental health, relationships and employment. Financial inclusion ensures that everybody in the UK has access to the services and skills they need to manage their money effectively.
Example products and services
The products and services below have been developed to support people into financial inclusion:
- Mission Asset Fund offers a credit reporting platform, lending circle and an educational programme in one, run by a non-profit organisation. The educational portion is followed up with a shared, interest-free loan aimed at building a traditional credit score. Programmes can be built around a particular purpose, e.g. Latino communities organised loans which covered US citizenship fees alongside the programme.
- Aire, a fintech start-up providing alternative credit scoring (lead founder White star capital). Uses consumer transaction and alternative services data to build transparent credit score-cards and affordability metrics. Opens credit services to a population that was outside of the scope of traditional credit scoring methods. One of the first in this space.
- Dopay, payroll system for the employers of the unbanked provided by a start-up with partnership with Barclays and Visa. Provides a platform for employers who wish to employ people who for whatever reason couldn’t access a traditional bank account. Employees receive both their salaries and access to financial services including a financial infrastructure.
