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Financial Inclusion

Financial Inclusion. Gillian Draper Social & Economic Regeneration. SE London Housing Partnership October 2010. A Definition of Financial Exclusion. “A lack of access to most or all of the range of financial services enjoyed by the majority of the adult population’.

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Financial Inclusion

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  1. Financial Inclusion Gillian Draper Social & Economic Regeneration SE London Housing Partnership October 2010

  2. A Definition of Financial Exclusion • “A lack of access to most or all of the range of financial services enjoyed by the majority of the adult population’

  3. Key Elements of Financial Exclusion • No access to bank accounts or limited use of accounts • Debts - including rent arrears • Lack of savings or home contents insurance • Problematic credit history - reliance on home credit agencies • Lack of confidence in dealing with finances

  4. Some statistics • 60% of the financially excluded are social tenants • 16% of social tenants have no bank account • Over 200,000 social tenants borrow from home credit industry at rates of over 272% or higher • 7.8m people in the UK are unable to access mainstream credit • Only 32% of tenants are in paid work • Social Housing tenants have average annual income of less than £12,000

  5. Labour Government Policy – Financial Inclusion a key priority • 2005 set up Financial Inclusion Taskforce and • Financial Inclusion Fund • (£120m for 2005-2008 and a further £130m for 2008-2011) • Face-to-face and outreach debt advice • Growth Fund for loans to financially excluded • Credit Union capacity building • Illegal money lending teams • 2008 Treasury pre-budget Report - additional • £5.85m for extension of telephone advice services • £10m to extend face to face advice services

  6. Why Housing Associations are involved in Financial Inclusion activity • Social and moral case • Maximise personal income • Decreases personal debt • Offers opportunity for personal advancement • Community benefit from more stable communities • Good business sense • cuts rent arrears, • reduces evictions and tenant turn-over • cuts cost of staff time • Reduces legal costs

  7. Southern Housing Group Response • Group-wide Financial Inclusion Strategy approved • Internal team of Financial Inclusion Officers • External Contract with Community Advice Services Limited (CASL) for advice to home owners • Supports development of Credit Unions and CDFIs • Partnership working with local advice agencies • Promotes take up of contents insurance • Developing a Fuel Poverty strategy • Promoting Financial Capability for residents • Links with Employment & Training initiatives

  8. The future…. • Coalition Government • ‘Reshaping the social housing landscape’ • Reductions in benefits and move into work • Ending of Financial Inclusion Fund initiatives • Impact of cuts on Third Sector • ...challenging times!

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