Strengthening community-based debt advice to close the health gap

How does debt impact health?

Debt affects far more than household finances. It impacts people’s mental and physical health, strains relationships, and makes everyday life feel overwhelming. For many people already on a low income, debt is not a one-off problem, but part of a cycle driven by low wages, insecure work and rising living costs that is difficult to escape.

When finances are unstable, stress and anxiety increase, health can deteriorate and everyday decisions become harder to manage. Poor health can make it harder to stay on top of bills or seek support, allowing debt to deepen and persist. This places pressure on already overstretched public services, particularly health and local support systems, while leaving people stuck in situations that could have been prevented with earlier, more effective help.

National policy increasingly recognises these connections. The Child Poverty Strategy, the Financial Inclusion Strategy and the NHS 10 Year Health Plan all highlight the importance of earlier, preventative action that supports people to stay financially stable and well.

Nevertheless, many of the services best placed to provide this support remain under-resourced. Funding structures and commissioning models often prioritise volume over depth and continuity of support, limiting the time advisers can spend with people facing the most complex challenges.

The policy context and what is missing

In response to this gap, a new project funded by Impact on Urban Health has been launched to strengthen community-based approaches to debt advice. Over the next two years, the project will work with Rooted Finance and Citizens Advice Southwark to deliver holistic, relational debt advice in Southwark and neighbouring London boroughs.

The work focuses on supporting Black, minoritised and marginalised communities, while building understanding of what effective community-based debt advice looks like in practice and how funding and delivery models need to evolve to better support it.

The challenges facing communities

Debt and financial insecurity do not affect communities equally. Structural inequalities that are deeply embedded within our society mean that Black, minoritised and marginalised communities are more likely to be pushed into deeper and more persistent poverty and into problem debt. These inequalities show up in many ways, including lower and less secure incomes, discrimination in the labour market, unequal access to financial services and credit, and systems that too often fail to respond to the needs of different communities.

Evidence also shows that the way many advice services are designed and operate does not always reflect the needs and realities of these communities, making access to support harder than it should be. Barriers can include issues of trust, service design, stigma, language access, and previous negative experiences with statutory systems.

Financial stress is closely linked to poor mental health, yet many people experiencing mental health difficulties report problems accessing adviser-led financial support at the point they need it most. When support is hard to reach or time-limited, problems can escalate, increasing the risk of crisis and longer-term harm.

There is also a limited shared understanding of how different community-based approaches operate in practice, what outcomes they achieve, and how best to support them. Much of the value created through longer-term, relational support is not well captured by existing measures, making it harder to learn from effective approaches or to fund them sustainably.

A new partnership to strengthen community-based debt advice

The project is delivered by Rooted Finance and Citizens Advice Southwark, working in Southwark and neighbouring London boroughs. Both organisations have long-standing experience of supporting people facing complex debt problems and understand the realities of working in communities where financial insecurity, poor health and wider pressures often overlap. This includes delivery across London, bringing insight from different contexts and communities.

The project is supported by learning and evaluation partners, the Financial Inclusion Centre and Resolve Poverty. It focuses on testing and expanding models of delivering effective community-based debt advice that improves outcomes for Black, minoritised and marginalised communities. These communities are more likely to be pushed into poverty and problem debt as a result of structural inequalities, and too often remain underserved by mainstream support. The project is shaped by day-to-day delivery and the experiences of people receiving support, with a focus on what helps people stay engaged, feel informed, supported and able to move forward in their lives.

At its core, the project is piloting the inclusion of holistic, wrap-around support within the debt advice process to better develop financial resilience. This allows advisers to spend more time with people facing the most complex challenges, responding to crisis, instability and changing circumstances. Delivery includes face-to-face debt advice, ongoing casework, outreach and referral pathways, developed in partnership with local groups and community organisations. Advisers work with people over time, providing consistent support that reflects the complexity of their lives and the challenges they face.

By working across different local contexts, and through organisations such as Rooted that design and deliver services through a culturally appropriate lens with lived experience embedded, the project will generate insights into what enables debt advice to support people effectively.

This will help identify what leads to more sustainable outcomes for people dealing with multiple pressures. The learning will also highlight where funding and delivery models need to change to better support flexible, sustained approaches to debt advice. In doing so, the project aims to strengthen the case for investment that better reflects how people experience debt in their everyday lives.

Why this approach matters

Accessing debt advice is not always straightforward. The way services are designed and delivered can make it harder for some people to seek support early, particularly when systems do not reflect how people experience financial difficulty in their everyday lives. Fear, shame or frustration can also discourage people from reaching out until problems have escalated.

For Black and minoritised communities, additional barriers can arise from discrimination, lack of representation and gaps in cultural understanding within mainstream services. These factors can create understandable reluctance to engage with services that may not feel accessible or trusted.

Community-based services help address these challenges by offering proactive, welcoming and culturally informed support rooted in the communities they serve.

This approach matters not only for individuals but for communities and the wider system. Effective community-based debt advice can reduce immediate financial stress, improve wellbeing, increase income and stabilise debts. It also helps build longer-term financial resilience. By preventing problems from escalating, this approach can reduce pressure on health and other public services. This directly aligns with Impact on Urban Health’s mission to improve health by addressing the social and economic factors that shape people’s lives.

The project seeks to show how investment in debt advice can work differently. By bringing partners together, supporting innovation, and recognising outcomes beyond volume, it aims to build a stronger case for better funding models. These models should enable effective, relational support to thrive. The long-term aim is that anyone who needs help can receive it in a way that works best for them.

What partners are saying

Muna Yassin, MBE, CEO at Rooted Finance said:

“At Rooted, we see how community debt advice reaches and benefits distinct groups and communities in a way that mainstream services simply cannot replicate. Our advisers respond with cultural and community intelligence to solve complex and entrenched debt issues: providing holistic and appropriate support relevant to a client’s circumstance.

This bespoke and tailored approach is increasingly being underfunded and unappreciated – despite evidence showing longer-lasting impact for clients.  We believe it’s time to invest in approaches that make a tangible difference to people’s financial futures. Rooted Finance is pleased to be working collaboratively with Impact on Urban Health, Citizens Advice Southwark, the Financial Inclusion Centre and Resolve Poverty to make the case for investing in our communities, by valuing and equipping the services they rely on.”

Tim Clark, Strategic Support Coordinator at Citizens Advice Southwark, said:

“We are excited to be involved in this project, which is looking at the effectiveness different models of delivering community-based debt advice. We know that Black, minority ethnic and marginalised groups face systemic injustices and are disproportionately affected by poverty and debt, while also often struggling to access the support they need.

Given the challenges involved, working in partnership to find solutions and deliver effective services is crucial. We are therefore delighted to be working on this project with Impact on Urban Health, Rooted Finance, the Financial Inclusion Centre and Resolve Poverty.

Debt advice funding is often volume-driven, which can make it harder to provide the type of support needed by people facing vulnerability. We hope this project will provide compelling evidence to funders of the value of locally delivered, community-rooted debt advice, with the space, time and resources required to support people facing multiple and complex challenges to achieve sustainable outcomes.”

Looking ahead

Over the coming months, the project will share further updates on delivery and learning, including opportunities to engage with emerging insight. By strengthening understanding of community-based debt advice, the work aims to support a shift towards funding and policy approaches that recognise value, not just volume, and enable services to meet people where they are.