LONDON–Homeless people in the United Kingdom will for the first time be able to open accounts with the UK’s five biggest banks, in a pilot scheme marking the launch of the government’s financial inclusion strategy, according to a new report.
The U.K. Treasury told the Guardian its new national plan was meant to ensure financial services “worked for everyone”, as it also revealed program that could help rebuild the credit scores of domestic abuse victims, support families with no savings and roll out financial education in primary schools across the UK.
“One of the key schemes will see the high street lenders Lloyds, NatWest, Barclays, Nationwide and Santander waive the need for people to have a fixed address in order to open a bank account,” according to the Guardian. “The move will help vulnerable people avoid the chicken-and-egg problem of needing a bank account to apply for work and rental accommodation across the UK.”
Partnership With Shelter
The report added that the initiative will involve partnerships with the homelessness charity Shelter, which will vouch for prospective customers based on information on the charity’s database, while accompanying individuals to face-to-face meetings at a local bank branch.
The scheme expands on a partnership with HSBC, which has opened 7,000 accounts for people experiencing homelessness since its start in 2019, according to the
“This plan is about opening doors – helping people experiencing homelessness into work, helping survivors of abuse rebuild their credit and helping families save for a rainy day,” The City Minister Lucy Rigby told the Guardian. “No one should be locked out of the chance to build a better future. Our strategy gives people the tools to get on and boosts the economy by supporting more people back into work.”
Help for Domestic Violence Victims
In addition, the Treasury said it was also rolling out plans to help victims of domestic abuse repair credit ratings that have been damaged as a result of perpetrators having forced partners to take on debt on their behalf.
Credit agencies including Experian, Equifax and TransUnion will start reviewing how they could rescore victim’s credit ratings, before reporting back to government, the Guardian reported, adding the financial inclusion strategy, which follows a years-long review by a Treasury-led financial inclusion committee, is aimed at boosting support for vulnerable people who have struggled to access banking and build financial resilience.
More Than 11 Million With Almost No Savings
It comes as statistics reveal that more than 11.5 million people in the UK have less than £100 in savings, “severely reducing their ability to recover from emergencies and unexpected costs such as boiler breakdowns or an extended illness,” the Guardian stated.
