Most of us have had experience of worrying about losing control of our money. Bills mounting week after week. Building up a small pot of money only to receive an unexpected bill or a knock at the door, suddenly emptying the piggy bank.
It can happen to anyone. Look at the Government. Its long fight to pay off our country’s debts is a long way from over.
But you hope that if your money ever slips its leash, you have protection. Savings. Reliable income. The social capital of a community that helps you learn how to bring money back under control. And we hope that we have elected a prudent government, whose chancellor is working responsibly to drive the spending of taxpayers’ money back within our means.
Others aren’t so lucky.
In Britain, the financially excluded number a shocking 1.5 million people. Three times the population of Edinburgh. They have no bank account. At least a third of them are stuck on welfare. They find themselves turning to payday loans to make ends meet, and however they stretch, the ends never do quite meet. The little money they have they carry gingerly.
And it gets worse. The help we try to give, may fail to get through. Because if you’re cut off from the financial world, you may also be cut off from the digital world. Imagine having no bank account. And now imagine you have no email account. And picture how frustrating that would feel when the way we give welfare, like everything else, is moving more and more online.
We have to fix this. But we’ll have to be smarter.
In an effort to address the vulnerability of financially excluded people, the Centre for Social Justice hosted a roundtable discussion in the summer to look at practical solutions to provide people with the support, skills and resources they need.
Want to fix financial exclusion? You can’t do it alone. Today, any realistic solution must team up with a drive to boost digital access. We can learn from the recent trial of Universal Support – local training designed to work with the government’s vital Universal Credit reforms. There are two items on Universal Support’s core curriculum, and they are the right ones: keeping a budget and getting online.
But we can’t leave it to the Government. After all, if you want dazzling IT projects or tight money management, a department of state is never going to be your first port of call. Which means it is critical that private companies and charities step up to help battle this two-headed giant.
After all, in Africa, it was innovative phone companies that brought mobile banking to the masses. Why can’t that happen here?
The CSJ report highlighted case studies of companies already doing their bit to help reduce financial exclusion. In the UK, it is great news that Lloyds Banking Group, as a key financial player, has already committed to delivering 20,000 Digital Champions by the end of 2017. Lloyds is helping businesses, charities and individuals develop precious digital skills. Sodexo, a world-renowned government services provider, works with local authorities in France and elsewhere to provide emergency welfare support to people who are disadvantaged. This type of system can help to deliver social inclusion, and encourage people to learn budgeting skills. They have seen great success with this model and believe there is a case for something similar in the UK.
And I’m so personally committed to this issue that I’m working on a new microfinance platform to enable all of us to lend small amounts of money to others in our community who have no access to any other kind of finance. We’re bringing microfinance and crowdlending, online innovations which have been remarkably effective in developing economies, to Britain’s excluded communities. Please get in touch if you are interested in hearing more.
Because none of us can afford to turn away.
Remember, these twin struggles, with money and the internet, aren’t just one more abstract policy problem. They equal social disconnection squared. Disconnection from the web, the greatest communication network in human history. Multiplied by disconnection from the peace and plenty of commerce. We know gold’s deepest value, John Donne wrote, when we recognise it is the soul of trade. And today it is the precious exchange of ideas and payments online that helps bind together our commercial society.
But not for hundreds of thousands of our fellow citizens.
Since you are reading this online article, you are lucky enough to be on the inside, like me. We need to help the excluded join the network. Sharing this great good fortune of ours more widely will leave no one the loser. I’d love to hear your ideas for how we can solve this problem, together.
Syed Kamall is Chairman of the European Conservatives and Reformists Group and is an MEP for London. Syed is taking part in a microfinance conference at City Hall on the 4th November. If you are interested in finding out more about this conference please email firstname.lastname@example.org
This article originally appeared on Conservative Home.