Fair4All Finance Insights – Research Roundup – March 2023

In March’s Research Roundup we take a look at research from Britain Thinks and the Finance and Leasing Association (FLA), Joseph Rowntree Foundation, Trussell Trust, Bain & Company, Citizens Advice, and annual statistics from the Department for Energy Security and Net Zero.

Ellie Suckling, our Social Researcher talks you through the latest research in this video. Alternatively, you can download a copy of the slides at the bottom of this page.

(20 – 24 March) It’s been a busy week for the banks, and following the release of the budget, it’s been important for us to reflect and assess what this might mean for our work in supporting people in financially vulnerable circumstances.

There were many parts of the budget that will positively impact financial wellbeing, which includes the Energy Price Guarantee remaining at £2500 until July, the expansion of childcare, as well as increases to universal payments, the state pension and the “national living wage”.

However, when looking at the large and widely discussed package for free childcare in England, this part of the budget highlighted systemic problems of implementing something on this scale. Free childcare for those under five will not be implemented fully until 2025, so those struggling with energy bills and inflation over the next few years will not see the benefits.

For childcare providers, they will, in turn, need to scale up support, but with over 5,000 closing last year and the providers currently losing around £2,20 per child per hour, it’s important that proper funding is provided to fill the gap. We’ll tie in all the budget impacts in next month’s roundup once the dust has settled, and more in-depth analysis can occur.

Our investment associate Naheed Hassan has provided insight on the fall of Silicon Valley Bank (SBV), the spill over into Signature Bank and the rescue of Credit Suisse. As far as credit provision and in particular for the customers that we seek to serve, it’s hard to say what impact this situation will have, but Bank of England says this ‘Major UK banks’ capital and liquidity positions remain strong and pre-provision profitability has increased. They are therefore well placed to absorb shocks and continue meeting the credit needs of households and businesses‘.

We know that historically during times of market uncertainty banks tend to tighten their lending criteria as a protective measure, so we’ll continue to monitor what this might mean for financial vulnerability.