Financial inclusion and open banking with techUK and the OBIE

On 15th July 2021, along with techUK, we hosted a webinar discussion exploring why financial inclusion has become more important since the pandemic, why it’s key for the UK’s economic recovery and what role open banking can play in giving financially vulnerable individuals access to tailored and fair financial services.

We invited a panel of experts in financial inclusion and vulnerability, as well as credit union lending, to offer their unique insights on these challenges and potential solutions.

  • Lakshman Chandraseke, CEO, London Mutual Credit Union
  • Carolyn Delehanty, vulnerable customer experience coach, Delehanty Consulting
  • Adrian Davies, co-founder, NestEgg
  • Rob Haslingdon, head of digital propositions, Experian
  • David Lockwood, senior business development manager, Finders International HQ
  • Simon Lyons, Head of Ecosystem Engagement, the Open Banking Implementation Entity (OBIE)

Why this matters now

In the past, banks made you use the channel they gave you – branch, phone and internet.

Open banking changes the way we can access our bank, so a lot of the legacy challenges some individuals face with inclusion and social banking have been removed. Which means we can get the bank we want.

While there’s no magic wand for financially vulnerable consumers, we do understand many of the wide variety of problems they face.

Our panel listed some of the areas that open banking can help with:

  • Financial vulnerability – including financial domestic abuse (for instance, where one partner controls access to the other’s finances, and even food).
  • People who can’t access services – the ‘unbanked’, who don’t have a bank account, and how we need to find an easier way to bring the unbanked into the system.
  • Faster loan processing – by helping the banks and credit unions help vulnerable customers faster (40% of loan applications come via open banking or digital statements) – they can process more loans more quickly and efficiently, speeding up access to finance.
  • Helping people understand the value of their data – the pandemic provided people with an opportunity to see exactly what they spent their money on which aided many people’s financial understanding and budgeting. Open banking can help with:
    • Eligibility – by confirming someone’s eligibility for a product and helping improve their money management skills.
    • Affordability – such as financial resilience, over-indebtedness, impact of redundancy, and then using that information to support customers in a positive way.
  • Challenges for people who have passed away. Settling estates is often problematic, and open banking can help relatives access the details they need to support the probate process.
  • Capacity to make decisions – this affects sensitive issues such as probate, and Court of Protection matters.
  • Speeding up assessment for lending, borrowing, and improved cash flow – people don’t always have single credit profiles (instead they may have part profiles with several organisations), which can slow down assessments for finance.
  • Supporting the ‘unbanked’ – with access to a transactional bank account, credit, savings, and even insurance.

Watch the video to find out more about how open banking help reduce the poverty premium, help people to budget better, and open up banking to more people.