Financial services offer the potential to help manage ﬂuctuations in income and expenditure, build resilience against future shocks, and provide the means for people to take advantage of opportunities.
Yet far too many lower income households and small businesses are struggling to achieve good ‘ﬁnancial health’: for example, many experience cash-ﬂow difﬁculties; fail to
save, and are not effectively planning ahead to determine and meet long-term goals. To address these problems we need ﬁnancial services that are accessible, easy to use, and meet people’s needs over their lifetime. We also want people to have the skills and motivation to use ﬁnancial services in ways which ensure they beneﬁt meaningfully from them.
Recent innovations in ﬁnancial technology (‘FinTech’) provide signiﬁcant opportunities to help us to realise this ambition (see the box on the following page). However, the potential for FinTech to deliver cannot be taken for granted and there remain a number of barriers both to fostering the development of innovations that meet the needs of lower income households and small businesses; and in getting successful innovations to scale.
With ﬁnancial support from the JP Morgan Foundation the Centre for Responsible Credit undertook to examine these issues through a programme of engagement with experts in the US and UK, involving telephone and face to face meetings and the conduct of a virtual workshop hosted using video conferencing technology in JP Morgan Chase ofﬁces in San Francisco, Chicago, Washington DC, New York and London on 22nd October 2015.
The ﬁndings from this project provide a starting point to deliver more collaborative approaches capable of harnessing the knowledge that non-proﬁts and the community ﬁnance sector hold about the ﬁnancial needs and behaviours of lower income households and small businesses and linking this to the technological expertise of the commercial FinTech sector.