Our response to the Financial Inclusion Strategy

Our thoughts on the Financial Inclusion Strategy

Yesterday’s publication of the government’s Financial Inclusion Strategy contains several encouraging commitments that align with our vision of a world where everybody has the financial freedom needed for good mental and physical health. 

We particularly welcome the focus on tackling problem debt through increased funding and more efficient services. The strategy rightly recognises that a range of debt advice services is required, including community-based models – something we’ve been calling for alongside our partners at Centre for Responsible Credit, Rooted Finance, and Citizens Advice Southwark.

Why community-based services matter

Community-based services often reach people who aren’t able to access digital channels and connect with those who might not otherwise know support exists. They build trusted relationships with local community members, offering culturally appropriate, holistic support that considers the wider pressures people are facing, from housing and employment to health and caring responsibilities. Face-to-face provision is especially critical for individuals experiencing mental health challenges, as highlighted by research from the Money and Mental Health Policy Institute, helping ensure that people feel safe, understood, and able to engage with the help they need.

Who should pay for debt advice services?

The announcement of the Consumer Energy Debt Advice (CEDA) service, funded through the energy advice levy, is a positive step. In our recent report Supporting Households in Energy Debt, we highlighted the £3.8 billion energy debt crisis and called for a more constructive relationship between the energy sector and debt advisers.

However, we also called for all creditor sectors – not just energy – to contribute to funding debt advice services. While financial services firms pay a levy and energy will now contribute, sectors like Buy Now Pay Later, water, and telecommunications still benefit from debt advice services without a proportionate funding contribution.

We’d like to see the government expand levies to other industries in the future.

Locating debt advice services in GP practices

The strategy correctly highlights that people often disclose money issues at GPs or Job Centres. Our work with the Financial Shield shows how supporting people at moments of disclosure makes all the difference. Locating debt advice in health services must be rolled out nationally, as proposed by the government’s 10 Year Health Plan.

The Financial Shield’s impact includes:

• A median financial gain of £4,000 per person supported
• More than half of participants reporting improved physical or mental health
• And reduced NHS demand (1/3 of participants made fewer GP visits)

It is clear that the Financial Shield is not only about financial inclusion, but also about health equity. We look forward to working with Government, the wider sector, and our community partners to deliver a debt advice system that is truly equitable and enables the financial freedom we all need for good physical and mental health.

Image credit: Centre for Ageing Better