Insights from cross-sector research informing the National Financial Inclusion Strategy, by Julieta Pasijoff

Imagine discovering that a loan has been taken out in your name by someone you know and trust. Imagine being told you owe £10,000 for money you never had access to. Imagine being told the debt cannot be written off because, under existing processes, it is legally recorded as yours. Imagine leaving an abusive relationship with no recourse to funds.

Your credit history is ruined. You can’t pay a deposit to rent a flat. You can’t open new bank accounts or access cards. You can’t even take out a mobile phone contract.

And no matter how many times you explain what happened, it is extremely difficult to reverse the situation. The system is not designed to trust and support you.

This is not a hypothetical scenario. This is the daily reality for victim-survivors of domestic and economic abuse, who statistics show are mostly women.

What is economic abuse?

Economic abuse is a form of domestic abuse in which a perpetrator controls, exploits or sabotages someone’s access to their own money, credit and essential economic resources. This can include housing, employment, utilities, mobile phones, food and clothing. Its purpose is to limit independence, restrict choices and create long-term financial insecurity. Crucially, the harm often continues long after the abusive relationship has ended, shaping the victim- survivor’s financial life for years to come.

In the last year alone, 4.1 million women in the UK experienced economic abuse by a current or former partner, with women from minoritised ethnic backgrounds and disabled women facing significantly higher risk.

What we heard through cross-sector research

To understand how economic abuse affects access to credit and financial recovery, Fair4All Finance undertook extensive cross-sector research. This work combined in-depth user research with collaboration across propositions, policy and engagement teams, and was shaped by engagement with banks, academics, policymakers, civil society organisations and regulators.

The research included multiple co-design processes: workshops with victim-survivors of economic and domestic abuse, as well as organisation-wide sessions exploring barriers and potential solutions across the financial ecosystem.

Creating safe, trauma-informed spaces for lived experience was central to this approach. Victim-survivors were able to speak openly about their financial realities and the long-term impacts of systems that fail to recognise coercion.

One victim-survivor shared how her partner had taken out multiple loans and credit cards in her name, enabled by access to her phone, insufficient identity verification and anti-fraud measures within banking apps. The result was long-term, unresolved debt and a credit file so damaged that rebuilding felt impossible.

‘When you leave an abusive relationship involving economic abuse and coerced debt, and try to rebuild your life, you’re not starting from zero. You’re starting from minus £10,000.’

Lived experience workshop participant

When systems misread abuse as risk

Across sectors, a consistent pattern emerged. A number of financial systems are designed around the assumption that customers act freely and independently. As a result, coercion is rarely recognised, and economic abuse is often recorded as individual financial behaviour.

Missed payments do not show fear. Defaults do not show control. Debt does not show abuse.

Only a small proportion of victim-survivors ever have coerced debts written off. And even when this happens, the damage frequently remains embedded in their credit files through mis-recording or unresolved data sharing across the CRAs, continuing to block access to housing, credit and basic financial services.

Survivors shared they are often required to explain their experiences repeatedly to multiple institutions, navigating fragmented processes that delay recovery and, in many cases, retraumatise them.

‘The abuse didn’t end when I left. It followed me through my credit file.’

Lived experience workshop participant

Consumer Duty and the prevention of harm

The FCA’s Consumer Duty requires financial services firms to deliver good outcomes for customers and to prevent foreseeable harm. This includes understanding customer vulnerability, identifying where harm may arise through product design or processes, and taking proportionate action to mitigate risk. For people affected by economic abuse, harm is often foreseeable and embedded in financial systems themselves. The Consumer Duty, therefore, provides a clear regulatory rationale for inclusive design, striking a balance between access and protection to support safer outcomes rather than compounding harm.

In digital financial services, friction refers to the moments in the customer journey where users are required to pause, confirm information, or complete additional steps before moving forward. These moments in the customer journey are often designed to improve security or prevent misuse, but they are frequently experienced as barriers to access.

Inclusive design does not always mean removing friction. In some cases, it means introducing positive friction at the right moments—particularly where safety, consent, and control are at risk. In the context of economic abuse, weak identity verification and anti-fraud processes can unintentionally enable harm, such as accounts or credit being opened without genuine consent. Research and lived experience point to the importance of proportionate safeguards, including step-up identity checks and clearer verification at critical moments.

When designed well, this kind of positive friction supports inclusion rather than undermining it. It helps balance accessibility with protection, reduces the risk of re-victimisation, and builds trust. These insights point to a clear conclusion: economic abuse is a structural barrier to financial inclusion.

If financial systems cannot recognise economic abuse, they will continue to exclude people who are actively trying to rebuild their lives safely. Access alone is not enough. Survivors need systems that are safe by design, flexible, and capable of responding to harm they did not cause.

‘I wasn’t asking for special treatment. I was asking not to be punished for surviving.’

Lived experience workshop participant

National Financial Inclusion Strategy: From research to policy change and product design

This growing body of evidence has helped shape national policy and influence product design. Insights generated through sustained research and collaboration with leading organisations in this space, including Surviving Economic Abuse, were submitted into the development of the National Financial Inclusion Strategy (published in November 2025), and incorporated into its cross-cutting work on economic abuse.

The National Financial Inclusion Strategy explicitly recognises economic abuse as a barrier to financial inclusion and treats it as a cross-cutting issue that should be addressed across policy, regulation, and service design. It highlights the need to tackle coerced debt and the long-term impact this has on credit files, improve pathways for credit restoration, and strengthen collaboration between government, regulators, financial services providers, and specialist organisations. By embedding economic abuse within the wider financial inclusion agenda and aligning it with commitments on violence against women and girls, the strategy signals a shift towards systems-level change that supports safety, recovery and long-term financial independence.

A critical part of this shift relates to how creditworthiness is assessed. The National Financial Inclusion Strategy recognises that damaged credit files resulting from economic abuse can continue to penalise survivors long after the abuse has ended. As part of its implementation, work is underway to bring together Credit Reference Agencies (CRAs), the UK Government, and industry stakeholders to improve how economic abuse is reflected in credit reporting. The aim is to ensure that credit files and scores do not treat coerced debt or abuse-related harm as indicators of individual risk, and that clearer, more consistent pathways exist for credit restoration.

From a product design perspective, community lenders are already demonstrating how tailored approaches to credit can support survivors of economic abuse who have nowhere else to turn. By tailoring the customers’ experiences and taking a needs-first approach, some of these organisations provide access to small loans and financial support for customers excluded from mainstream credit. Rather than relying solely on traditional credit checks, they use tools such as open banking to build a more rounded picture of income, expenditure and individual circumstances. These approaches highlight an opportunity to tailor access to products and expand it more broadly across the financial system. Embedding similar principles into a wider range of products and providers could help ensure that survivors are not left without options while broader system change continues.

Conclusion

Economic abuse shows us that financial exclusion is not only about lack of access. Often, it is about systems that are not designed for real-life power imbalances, risk, and harm.

Now imagine a financial system that is designed with this reality in mind, one that recognises foreseeable harm across the customer journey and balances protection with safe access to financial products.

Across the customer journey, there are key detection points where financial services already intervene to protect customers, most notably through the systems and controls developed for fraud prevention. Economic abuse highlights an opportunity to apply similar approaches to identify coercion and lack of consent earlier, and to strengthen protection at moments where harm is foreseeable. Doing so aligns directly with the expectations set out under the Consumer Duty, including the responsibility to prevent foreseeable harm and deliver good outcomes, particularly for customers in vulnerable circumstances.

Recognising economic abuse in this way is not only a matter of support. It is a necessary step towards safer and more inclusive financial systems.