Fair4All Finance are partnering with Esmée Fairbairn Foundation, NatWest Group and StepChange on new research into how ethnicity influences access to financial products and services in the UK.
The research aims to fill current gaps in understanding. It will explore practical short, medium and long term solutions to current inequalities, such as:
- Fraud victims from minority ethnic groups are more than twice as likely not to get their money returned compared to White fraud victims
- 60% of Asian and 63% of Black households have no savings, compared to 33% of White households
- Black African, Black Caribbean and Bangladeshi groups are 4x, 3.5x and 2.5x more likely to be denied a loan respectively compared to White groups
The goal is to show how financial services providers can be more inclusive of people from Black, Asian and minority ethnic backgrounds.
The group will use the insights to enable the development of well designed and effective solutions. Ones that increase the financial inclusion of these communities.
Regulators, policymakers and people working in financial services will also be able to use the findings to inform their decisions on how to improve outcomes for Black, Asian and minority ethnic communities.
Joint funding from Esmée Fairbairn Foundation, Fair4All Finance and NatWest Group is in place. Fair4All Finance are now looking for a provider to conduct the research.
An advisory committee will support on the development of the research and share data led insights with the researchers. The committee is made up of practitioners across the financial services sector including:
- Carl Packman, Head of Corporate Engagement, Fair By Design
- Fozia Irfan OBE, Non-Executive Director, Fair4All Finance
- Jerry During, CEO & Co-Founder, Money A+E
- Muna Yassin, Managing Director, Fair Money Advice
- Peter Tutton, Head of Policy, StepChange
- Sacha Romanovitch OBE, CEO, Fair4All Finance
- Shamraz Begum, Co-Lead of the Racial Equality Taskforce, NatWest Group
Importantly, everyone involved is committed to taking the insights and recommendations forward. And to improving access to appropriate financial products and services for Black, Asian and minority ethnic communities.
Sacha Romanovitch OBE, CEO of Fair4All Finance said:
‘People from Black, Asian and minority ethnic communities face greater exclusion from the financial system. There are multiple issues in the entrenched design and behaviours in the system that contribute to this.
‘However there’s little research on the recent experiences of exclusion by ethnicity in the UK, the reasons behind these issues or how to address this exclusion. This research aims to change that.
‘We’re grateful to everyone who is collaborating with us on this important work, including our co-funders Esmée Fairbairn Foundation and NatWest Group. It’s great to have a major retail bank like NatWest stepping forward to take a lead in this research and we welcome others who want to play their part in achieving equity and inclusion in financial services.’
Ben Smith, Head of Social Investment at Esmée Fairbairn Foundation said:
‘We’re really pleased that the voices of those experiencing racial inequity will be at the heart of this research, which will go on to inform the changes needed for a fairer financial system. We have worked alongside Fair4AllFinance since its creation and are delighted that they are leading this important work.’
Katie Murray, Chief Financial Officer at NatWest Group said:
‘Financial inclusion is at the very heart of our purpose, to champion potential so that the people, businesses and families we serve can rebuild and thrive.
‘In our 2020 report, Banking on Racial Equality, we made a number of commitments to our Black, Asian and minority ethnic customers, colleagues and communities, including understanding the socioeconomic barriers facing these communities through research and strategic partnerships, delivering enterprise and career education programmes, and building financial capability.
‘We’re proud to be collaborating on this important and unique research. We know there’s more we can and must do to remove barriers to finance, and this research will help us drive real, necessary change across NatWest Group and the finance industry.’
Peter Tutton, Head of Policy Research and Public Affairs at StepChange said:
‘StepChange Debt Charity is delighted to join Fair4All Finance, Esmée Fairbairn Foundation and NatWest Group in this important project. We know that savings for a rainy day and access to affordable credit can make a crucial difference in helping people cope with income shocks and unexpected expenses, without becoming vulnerable to problem debt.
‘Our research on the financial impact of the covid pandemic shows that people from Black, Asian and minority ethnic communities have been among the hardest hit groups, with many facing financial uncertainty and problem debt. This demonstrates the urgent need for greater financial inclusion and resilience and we hope this research will highlight ways in which regulators, policymakers and people working in financial services can improve outcomes.’