Key Scottish influencers meet to discuss targeted approaches to financial exclusion in Scotland

Posted On: 
11th December 2018

Responsible Finance, Carnegie UK Trust and Scotcash are bringing together a high-level group of influencers today (11 December 2018) at the Scottish Parliament to discuss "tackling financial exclusion in Scotland – what more can be done?”  

 The evening debate will shine a spotlight on what action the Scottish Government can take to tackle financial exclusion through support for affordable credit.

Many of the most disadvantaged citizens in Scotland are facing a series of economic challenges placing them under substantial pressure. Weak income growth, households’ lack of ‘rainy day’ savings and the implications of the ‘gig economy’ are all factors contributing to the financial pressure on households. Access to credit is essential for smoothing out fluctuating incomes and responding to financial shocks. Many of the most disadvantaged households have limited and reducing access to credit, and they pay significantly more to borrow money than other members of society.

Carnegie UK Trust’s vision for affordable credit is that everyone, wherever they live, should have access to more affordable forms of credit, which reduce the cost of borrowing for those outside the mainstream, support financial inclusion and promote equality and fairness.

Responsible finance providers like Scotcash play a significant role in providing credit and wraparound services to those on low incomes who are unable to access finance from mainstream sources. They have substantial local social and economic impact but do not currently have the reach to tackle levels of demand for responsible finance.

The evening will discuss the role of responsible finance providers in providing credit to those excluded from mainstream banks, and what role the Scottish Government can play in helping the sector to expand.

The event will be hosted by Richard Leonard MSP, leader of the Scottish Labour Party and spokesperson for the economy. Key speakers include Aileen Campbell MSP, the Cabinet Secretary for Communities and Local Government, Andy Wightman MSP, Communities spokesperson for the Scottish Greens, and Very Reverend John Chalmers, Chair of Carnegie UK Trust’s Affordable Credit Action Group.

Leader of the Scottish Labour Party, Richard Leonard said:

“Austerity has driven more people into the arms of payday lenders that prey on those struggling to make ends meet, putting them at serious risk of falling further into debt.

“We have to do more to extend the role of responsible lenders and credit unions, and we have to change society and our economy so they work in the interests of the many, not the few.”

Aileen Campbell, Cabinet Secretary for Communities and Local Government, commented:

“Tackling poverty and inequality is a key aim of the Scottish Government. We want to increase people’s access to affordable financial services in order to improve their financial inclusion which is why we have invested £1 million investment in Carnegie UK Trust’s Affordable Credit Fund to provide genuine alternatives to high cost credit lenders for people on low incomes.

“This sits alongside the new Financial Health Check which ensures people are getting the benefits they are entitled to and not paying more for basic services because they have limited choice, and our work with Health Boards so that midwives and health visitors can refer families directly to local income maximisation services. 

By working collaboratively with our stakeholders and supporting organisations working in this area, we will continue to help people on low incomes to increase their financial inclusion.” 

Very Reverend John Chalmers added:

“This event provides a welcome opportunity to highlight the important role of affordable credit in tackling poverty. We all need access to credit at different points in our lives, but too often those with the least have to pay the highest costs when borrowing. This needs to change. Responsible finance providers undertake vital work in giving people access to more affordable credit, delivered on a not-for-profit basis, as well as offering a gateway to other essential services including debt advice and basic bank accounts. The sector has received excellent support in recent years from organisations including the Scottish Government and Carnegie UK Trust – now we must do even more to help these ethical providers reach and support many more people.”

Chief Executive of Responsible Finance, Jennifer Tankard also commented:

“As we approach Christmas, which places many families under financial pressure, it is timely to reflect on the fact that personal debt in the UK continues to rise as households struggle to pay for daily essentials and that 230,000 children in Scotland are living below the poverty line. 
“Responsible Finance providers, like Scotcash, provide an essential service to many low income households by providing access to affordable credit and financial inclusion support.  We welcome support from the Scottish Government and organisations like Carnegie UK for the sector.  But more action is needed if more households are to get the support they need.”