We are extremely proud that this year’s Party Conference season will mark the start of Visa Europe’s two-year partnership with the Financial Inclusion Commission. Financial exclusion affects millions of people across the country, and the Financial Inclusion Commission’s work to highlight the problem, and to champion the solutions, has already made a huge impact. But unfortunately this remains one of the hardest policy challenges facing the financial services sector and there is still much that can, and must, be done. We are excited to be standing shoulder to shoulder with the Financial Inclusion Commission as we enter our new strategic partnership in which we are determined to set the bar high for what we can achieve together.
At Visa, we understand the power and potential of digital payments. We see it time and time again in our business and in our worldwide research: convenience and fraud protection for consumers; increased trade opportunities, greater efficiency, cost savings and happier customers for businesses; huge savings for Government in reduced crime and lost tax revenue. Across any economy we look at, the numbers add up. Globally, we believe it could amount to $12 trillion of total additional economic activity over the next 15 years. This is why our mission is to be the best way to pay and be paid, for everyone, everywhere.
Everyone, everywhere. That means something very important to us: it means nobody is left behind, be it by virtue of geography, age, background, access to technology, skills or any other reason. We know we have a tremendous opportunity and responsibility to facilitate and drive greater participation and access to economies; and we have seen how digital payments can act as a springboard to greater inclusion, and ultimately better life chances. So identifying the barriers and tackling them is not just a moral imperative for us, it sits at the heart of what we do as a business. That’s why, through our products and services, our philanthropy and our global commitment to a social impact agenda, we are focused on ending financial exclusion.
As our partners at the Financial Inclusion Commission make clear in their report, Improving the Financial Health of the Nation, this is not an easy problem to solve; and the presumption that, as a developed economy, the UK does not suffer from a serious financial inclusion problem is unfortunately far from the case.[1] The gap between rich and poor is widening, and 2.7 million UK adults remain almost entirely on cash.[2] Nearly one in ten UK adults has never used the internet.[3] Too many people are still digitally excluded, lacking either the skills or the access to take advantage of the benefits of the digital world. This is particularly common in ‘underserved’ demographics, such as the unemployed and those living in rural areas. As a business, we are also particularly concerned about underserved small and micro-merchants, who have so much to offer the economy, but for many of whom remaining in business each week is precarious and uncertain.
We have been looking at how digital payments can help in the UK, especially with regards to these underserved groups, and earlier this year we commissioned specific research, the results of which were striking. We found that greater adoption of digital payments in large cities, such as Manchester and Birmingham, would bring an average of £119.15 in net benefits per resident per year, while those living in rural areas could experience an average of £85.73 in gains.[4] There were also significant benefits for underserved groups, including the disabled – who could experience a positive impact ranging from £56.55 for those with disabilities in rural areas, through to a considerable £397.98 for those with disabilities in mid-sized cities.[5] The case for action is clear.
We also know that it’s not simply about helping more groups and individuals to utilise digital payments. It’s also important to ensure that consumers and businesses have the confidence they need to manage their money in a digital world. We know budgeting is a key reason why some people continue to use cash, and we are using our technology to empower consumers and businesses, via greater visibility and control of their payments. This means innovations like our Visa Transactions Control product for our clients, which allows cardholders to set spending limits through a simple control centre in their mobile banking app. Ultimately, we want everyone who uses digital payments to feel in control of their money, at anytime and anywhere.
There is a lot to do. It will require commitment, collaboration, and new thinking – all of which we hope to bring to our new relationship with the Financial Inclusion Commission. We are looking forward to getting started!
With the support of Visa, Prospect and the Financial Inclusion Commission will be hosting two receptions at the 2018 Conservative party conference and the 2018 Labour party conferences. Speakers will include: Peter Dowd MP, Shadow Chief Secretary to the Treasury; Guy Opperman MP, Minister for Financial Inclusion; Sir Sherard Cowper-Coles, Chair, Financial Inclusion Commission; and Jessica Lennard, Head of UK Regulatory Affairs, Visa Europe.
For speaker and partnership opportunities, please contact saskia.abdoh@prospect-magazine.co.uk.
[1] Financial Inclusion Commission, Improving the Financial Health of the Nation, 2015
[2] UK Finance, UK Cash & Cash Machines, 2017
[3] Office for National Statistics, Internet users in the UK: 2017, May 2017
[4] Research was commissioned by Visa Inc., and conducted by ESI Thoughtlab, among businesses and consumers in April 2018
[5] Research was commissioned by Visa Inc., and conducted by ESI Thoughtlab, among businesses and consumers in April 2018
