HM Treasury has published a 52-page Financial Inclusion Strategy, described as a first step towards greater inclusion and framed around six focus areas: digital inclusion and access to banking; savings; insurance; access to credit; tackling problem debt; and financial education. The foreword is written by economic secretary to the Treasury Lucy Rigby. Technology appears throughout the document, with open banking and Artificial Intelligence signalled as ways to remove barriers to participation and improve resilience.
Open banking is highlighted for enabling people to see a real-time picture of their finances and for improving access to credit for those with thin or impaired credit files. The strategy notes ongoing work to develop secondary legislation to support wider roll-out and new products such as Variable Recurring Payments. The Financial Conduct Authority and the Payment Systems Regulator are supporting an industry-led initiative to establish a commercial model and operational requirements for those payments. The paper also points to the established UK open banking ecosystem, public sector pilots and procurement by HM Revenue & Customs, National Savings & Investments and the Department for Work & Pensions, and cites more than 15 million monthly open banking user connections reported by Open Banking Limited.
To tackle account access issues, the strategy commits banks to pilot a cross-sector solution for opening accounts without standard ID and to convene an Identity and Verification Working Group, supported by UK Finance, with reports to HMT every six months and a launch target by the end of 2025. The document cites roughly 900,000 people as unbanked in the UK according to the FCA Financial Lives Survey and notes that many are unbanked by choice while others face access barriers.
The strategy promotes use cases and pilots for access to credit and debt advice. It references a Capital One UK initiative that offers applicants the option to link open banking data for pre-approval, a Fair4All Finance pilot of small sum personal loans funded by dormant assets and work with the FCA’s innovation services. The Money & Pensions Service will continue debt advice modernisation, and the strategy includes a Lancashire Community Finance case study where cloud telephony with Artificial Intelligence transcription and summarisation saved advisers 25 minutes per client, reduced administration time by 37 percent and increased caseload capacity by 27 percent. HMT will review implementation in two years using outcome-based metrics covering savings, unbanked adults, people in financial difficulty and use of debt advice. Lord Holmes welcomed mentions of open banking and accessibility initiatives but urged stronger emphasis on how fintech can accelerate inclusion.
