On Monday the 21st of May, Seema Malhotra, the Member of Parliament for Feltham and Heston, held a debate on Financial Exclusion and Access to Cash in the Westminster Hall chamber of Parliament.
Fundamentally, the bigger picture is inclusive economic growth and flexibility, security and choice in personal and family finance. Cuts to welfare, stagnant wages and economic instability in the last decade have exacerbated the precarious position of millions of people in the UK. The Money Advice Service estimates that 22% of UK adults have less than £100 in savings, which makes them highly vulnerable to a financial shock such as job loss or an unexpected bill. Some 8 million people rely on high-cost credit to pay essential household expenses, and may frequently turn to alternative forms of finance such as high-cost lenders or illegal loan sharks to make ends meet. Recent Financial Conduct Authority data shows that the number of high-cost short-term credit firms has decreased, but the volume of lending has increased.
She also made suggestions for the Government to improve access to cash:
- A Minister for credit unions
- Promote payroll savings
- Saving clubs in schools
- Remove regulatory obstacles