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Social Justice

I was in a violent relationship. I wouldn't have got free without financial help

Those who are managing 'higher-than-average long-term debts' were found to have risen by 57% to 3.6 million people

Person using ATM

‘Too many people’ excluded from financial services as millions managing ‘higher-than-average’ debts (Eduardo Soares/Pexels)

Financial inclusion charities have highlighted that “too many people” managing “higher-than-average long-term debts” are being excluded from financial services. It comes as a study found that nearly half of UK adults are living in “financially vulnerable” circumstances

The study, published by financial inclusion organisation Fair4All Finance on Tuesday (16 July), found that almost half (44%) of UK adults are in a “financially vulnerable” place, and that many of those affected also struggle with accessing services like loans or credit.

The organisation explained that the adults living with financial insecurity came from a variety of backgrounds, from homeowners to young people on zero-hours contracts, claiming Britain’s money worries in 2024 “transcend age, class, occupation and other social boundaries”. 

Those who are managing “higher-than-average long-term debts” were found to have risen by 57% to 3.6 million people, while families in “crisis position” relying on credit to be able to afford necessities has grown by 11% in the past year.

The study found that many of the people affected by financial insecurity were using buy-now-pay-later schemes or short-term credit to top up their incomes, and that some may have to turn to illegal money lenders or loan sharks in search of support. One in five (22%) of the financially vulnerable people surveyed had been rejected for credit in the past year.

Vicky May, a mum-of-three who was able to put a deposit down on her house using a credit union, told Big Issue that access to financial services are a “great help”.

Advertising helps fund Big Issue’s mission to end poverty
Advertising helps fund Big Issue’s mission to end poverty

“I was in a really violent relationship… and it helped me to get out of the situation, basically. It has helped me a lot,” the 28-year-old from Telford explained, adding that being able to use the credit union had helped “massively” with feeling “comfortable with money”.

She added that she would “definitely not” be able to put a deposit down for a house without the credit union.

Vicky explained that it’s often “hard to get accepted for a loan”, and that “flexible” credit unions were a great help for her.

She urged the government to “have more of a range of financial help available”, adding that “it helps massively, especially for people like young mums or people moving out, if they can’t move out because there’s no money and they don’t get financial help.”

Fair4All Finance’s deputy CEO Sarah Porretta explained that financial inclusion is a “key enabler for growth and resilience”, adding that the organisation welcomed the Labour government’s “commitment to establishing a national financial inclusion strategy“.

She explained that Fair4All Finance’s study findings “leave no room for doubt that the current financial services system is not working for everyone”.

“Industry and policymakers must unite to address the increasingly desperate situation facing millions of adults in financially vulnerable circumstances,” she added. 

Martin Coppack, director of financial inclusion organisation Fair By Design, added that “too many people” struggling with debt are charged a “poverty premium” when it comes to accessing financial services, and that “everybody needs access to affordable financial products and services that meet their needs”.

“We have a market that works for the healthy and the wealthy and discriminates against people for factors outside of their control, such as where they can afford to live, being on a low income and being disabled,” he said.

“We want everyone to pay a fair price for life’s essentials because life shouldn’t cost more if you are poor.

“We welcome the Labour government’s commitment to launch a national financial inclusion strategy. Adequate consumer representation will be essential to ensuring the the success of this initiative.”

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