Financial Inclusion Commission Campaign

Financial Inclusion, as defined by Fair4All Finance, “means that individuals, regardless of their background, income or personal circumstances, are aware of and have timely access to appropriate and affordable financial products and services which enable them to manage their finances day to day, build their long-term financial resilience and wellbeing and participate in society.”  

Financial inclusion remains a significant challenge for the UK with 12.9 million people currently experiencing low financial resilience according to the latest Financial Lives 2022 survey by the Financial Conduct Authority (FCA).  

For example: 

• Nearly 1 million people do not have a bank account 
• A quarter of Brits do not have home contents insurance 
• There are nearly 11 million adults struggling to pay their bills and debts 

CAMPAIGNS 

Fair By Design is calling on the Government to introduce a cross-cutting ‘must have regard’ to financial inclusion for the FCA. This would place a clear remit on the regulator to ensure it considers financial inclusion across its work. This would enable it to consider poverty premiums, which almost always sit outside of its remit, as a financial inclusion issue. 

Throughout the past 12 months, we worked closely with the House of Commons and House of Lords during the passage of the Financial Services and Markets Bill, putting forward an amendment calling for such a ‘must have regard’.  

We received cross party support in the House of Commons and support from the Treasury Committee in their report on the future of financial services regulation.  

We were thrilled the amendment passed in the House of Lords, despite opposition from Government, with cross-party support in the Lords from Labour, Conservatives and Liberal Democrats. 

Sadly, the amendment was rejected in the House of Commons, despite support from Labour, Liberal Democrats and Scottish National Party.  

We will continue to work with Members of Parliament calling for a ‘must have regard’ to be introduced. As one of the next steps the campaign is also calling for a national strategy on financial inclusion that would include a ‘must have regard’.  

The issue 

The FCA does not have a clear duty or cross-cutting objective to tackle financial inclusion. This results in many consumers falling through the cracks, with regulator and Government often pointing to each other for action. It is not right that there is no clear statutory requirement for the FCA to even consider financial inclusion issues. 

The solution  

We are calling for a new focus on financial inclusion (known as a “have regard”), which would create clarity on how far market regulation can address financial exclusion and where social policy is needed instead, or if they are needed together. This would place a clear remit on the financial regulator to ensure it routinely examines financial inclusion. 

Past campaign activity ⬇️

• November 2022: our Director Martin Coppack gives oral evidence before the Public Bill Committee on the Financial Services and Markets Bill. 
• July 2022: in light of the Treasury Select Committee’s endorsement of our call for a ‘must have regard’, an amendment was put forward by Emma Hardy MP (Labour), Siobhan McDonagh MP (Labour), and Kev Hollinrake MP (Conservative) to the Financial Services and Markets Bill.   
• June 2022: the Treasury Select Committee publishes a report into the Future of Financial Services Regulation, with recommendations to Government. The report supports Fair By Design’s call for the FCA to be given a ‘must have regard’ to financial inclusion. 
• March 2022: Martin Coppack features on Channel 5 News calling for the introduction of a ‘must have regard’. 
• February 2022: campaign launches with an open letter to Economic Secretary to the Treasury calling for change, which is supported by over 70 charities, politicians and businesses.  
• January 2022: Fair By Design’s Director Martin Coppack gives evidence at the Treasury Select Committee Future of Financial Services session, highlighting the need for a greater focus on financial inclusion.