We have responded to the Treasury Committee’s inquiry into the Financial Inclusion Strategy.
Fair4All Finance welcomes the Government’s Financial Inclusion Strategy and the renewed focus it brings to tackling the issue of financial exclusion in the UK. Financial exclusion remains a significant and systemic challenge in the UK, which requires sustained and cross-sector collaborative action to tackle.
We are pleased to have a key role in delivering several projects under the Strategy, across credit, insurance and financial capability. To support the successful implementation of the Strategy, we are operationalising these projects at pace.
In our view, the Financial Inclusion Strategy broadly addresses the right issues and adopts a welcome, cross-cutting approach. The six pillars align with Fair4All Finance’s own drivers of exclusion, and the inclusion of mental health, accessibility and economic abuse as cross-cutting themes is appropriate. As the Strategy develops, there are additional areas that could be covered, for example on access to affordable motor insurance for low income households.
We agree that an initial two-year review can be appropriate for establishing early momentum and testing whether delivery structures are functioning. But a two-year review cycle will not be sufficient on its own for a challenge as structural and significant as financial exclusion, and longer term targets should be set.
Similarly, the sustainability of the Strategy could be enhanced by deepening industry contributions and diversifying sources of investment. We hope the Strategy is a starting point for stronger industry engagement and believe clearer expectations and incentives could help to unlock sustained private sector investment, such as greater investment by UK banks into the community finance sector. In addition, Treasury-supported mechanisms, including guarantees, could play a transformative role in encouraging investment and scaling affordable credit.
Fair4All Finance stands ready to support the Committee and Government in delivering transformative change through the Strategy.
