How do financial capability needs differ among low income households?

3 Mar 2016 By Hannah Murphy, Centre of Responsible Credit

Today we welcome Hannah from the Centre for Responsible Credit.  Hannah discusses an exciting new piece of research that CfRC are conducting to better identify the financial health needs of low-income households.  This research will provide Financial Health Exchange members an opportunity to get involved.

At the Centre for Responsible Credit we want to ensure that all people living on a lower income are assisted to improve their financial health. Improving financial health enhances the wellbeing of individuals, communities and society as a whole.

For people to be financially healthy requires them to have both the financial capability and confidence to manage their affairs effectively and access to the right financial products, which suit their different needs and engage people into support at the right time. People on a lower income can be excluded from mainstream credit provision and forced to use high cost credit alternatives which negate good money management and can lead to problematic debt. Engaging with people has been shown to be most effective when intervening at important life events, or financial pressure points.

Projects which help people improve their financial health are often targeted to “lower income households” because they’re more vulnerable to financial difficulties. However, we need to recognise that this category of “lower income households” is made up of a hugely diverse range of people with different learning needs, barriers and planning priorities.

Our research aims to segment the group “lower income households” to better identify specific financial needs and deliver a ‘what works best’ briefing covering all aspects of financial health.

Throughout April 2016 we’re looking to undertake calls and site visits to financial capability and inclusion projects based in London, Edinburgh and Glasgow to explore the provision for low income households. We want to bring together providers’ understandings of the challenges faced by different groups of lower income people and best practice to overcome these barriers.

We are interested in how the content of programmes has been designed to meet the specific needs of different low income groups. We are also interested in how projects have built in other support aspects into delivery such as fostering other skills alongside money management, flexibility in delivery time and locations, provision of childcare, language support or other adaptations for different cultural requirements or health needs.

For further information, and if your project could participate in this innovative research, please get in touch with Hannah Murphy before 15th March 2016 at