Campaign calls for action on inclusion
20th May 2005

Debt on our Doorstep today called for the Government's Neighbourhood Renewal Unit to be given responsibility for driving forward a new approach to tackling financial exclusion in England's poorest communities.

Our report, Scaling Up for Financial Inclusion, is the result of 12 months research into the current provision of affordable credit for low income households and follows consultation with people on low incomes and policy makers. Although many organisations in the community banking sector offer help at a local level, the report said, most are small and do not offer the range of services needed.

The report urges the Government to set up a new agency to work alongside the NRU and the Treasury's Financial Inclusion Task Force to help promote the roll-out of a national programme designed to tackle debt and open up access to affordable credit.

Proposals include ensuring all local authorities in the 88 most deprived areas draw up a financial inclusion strategy via their local strategic partnerships. This would identify all local agencies able to deliver services such as basic bank accounts and financial advice. Local strategic partnerships should then identify a lead agency in each area to take forward the implementation of measures to address financial exclusion.

Under the proposals, the government's new £120m financial inclusion fund, announced last year, would be channelled through these strategies.

The report said financial exclusion was concentrated in deprived areas where millions of pounds were being invested via government neighbourhood renewal initiatives.

'However, nearly equal amounts of money are draining out of these areas due to households being reliant on extortionate lending practices of door-to-door money lenders,' it said.

Niall Cooper, Vice Chair of Debt on our Doorstep commented on the launch of the report:

Current government policies and resources provide a real opportunity to tackle financial exclusion. But to put these policies into practice government needs to nominate one of its departments to co-ordinate delivery and monitor progress in the creation of financial inclusion services.