The Government has announced the launch of a new organisation aimed at giving more people access to financial services.
A new campaign “open banking for good” forms part of the Inclusive Economy Partnership, announced today, which will push to ensure that new developments in so-called “fintech” benefit those who are struggling most to manage their money.
The announcement comes as new research shows growing financial strain across the UK. According to the research, published today by Neyber, financial worries are the biggest concern facing UK employees; 50 per cent of people regularly need to borrow money to make ends meet and than a third of people have a month’s salary saved in case of emergencies.
Nationwide, which is part of the new partnership along with Nesta, Money Advice Trust, Doteveryone and Accenture, said that one in four households could benefit from apps and tools made available through open banking.
Joe Garner, chief executive of Nationwide, said: “There could be more than 12 million people in the country who are only just keeping their heads above water in terms of their finances. Just one or two right or wrong financial decisions can make all the difference between financial health and spiralling debt.
“We believe Open Banking presents a huge opportunity to help people manage their money better and support a more inclusive financial services sector. We’re looking for innovators to come forward with ideas to help people living on a financial knife edge – with no savings or relying heavily on credit.”
Open Banking has the potential to help better connect people with their overall financial information. However, it could also leave people behind if organisations purely focus on profit rather than purpose. Open Banking for Good is looking to harness this new technology to help solve some of the biggest financial challenges facing society, such as debt, managing money and the ability to save.
The fintech community will be invited to develop Open Banking solutions that make a difference to people’s lives, in the knowledge that an estimated 85 per cent of adults either own or have access to a smartphone.
The winners of the challenge, which will launch in September, could receive investment and support from Nationwide.