A lack of digital skills and fear of going online is leaving millions of people in the dark when it comes to managing their finances. Here we look at what work is being done to bridge the gap between digital and financial exclusion.

In the Quids In Professional Network newsletter, we’ve spoken about digital exclusion before. Last month our report on the unemployment crisis discussed how it has taken a global pandemic for us to realise that having internet access is essential for living. We know that not having internet access holds people back and has the biggest impact on low income households. Yet the problem still isn’t being seen as a priority across the support sector. 

The government desperately needs to address the issue of digital exclusion but it is not solely their responsibility. Organisations who look after people’s financial wellbeing have been slow to act, largely because digital and financial exclusion continue to be seen as separate issues.

The coronavirus pandemic has forced organisations to come together to share their financial and digital expertise. Earlier this month Quids in! joined a coalition to support the launch of a new programme to provide free online training and advice on how to take control of your money. The campaign, Leave Nobody in the Dark, aims to link low income consumers to a series of courses, via digital inclusion charity, Learn My Way, and to guidance provided at quidsinmagazine.com. It hopes thousands of low digital users will gain the skills and confidence to use the internet to improve their financial wellbeing.

SPOTLIGHT ON DIGITAL

Backed by MasterCard, partners on the campaign include the Good Things Foundation and Clean Slate Training & Employment, which runs Quids in!. The Joseph Rowntree Foundation has also supported the programme to provide a ‘guided service’. Support workers walk people in 11 locations around the UK through online resources linked to a ‘money health-check’ process designed to identify steps they can take to improve their financial wellbeing. The APLE Collective, a national network of individuals who have experienced poverty, have been involved in the design of the programme.

At the beginning of the month a YouGov survey revealed that 19.4 million Brits are not prepared for an economic downturn, with many feeling in the dark about their financial future. 

The survey found that over a quarter (27%) do not know how to access any online guidance for their finances. Of these, a third (36%) say it is because they don’t know where to look, while almost a quarter (23%) say they find it overwhelming. 

On top of this, only 47 per cent of people on a low income have broadband internet at home (according to an Ofcom report). For many, technology is considered a luxury item.

NO DIGITAL, NO BENEFIT

If people can’t get online, not only are they likely to miss out on essential state support, including Universal Credit, but they are unable to benefit from free, online advice for money and debt problems. Linking access to the internet a pre-requisite for receiving welfare, makes digital provision for all a civil rights issue.

The findings from the YouGov report highlight this: Nearly half (48%) of Brits aren’t sure what Support Allowance means and 44% don’t know what a Credit Union is. Nearly a third (31%) of Brits aren’t confident what Universal Credit means and 28% of Brits don’t know what a Premium Bond is.

The media frequently reports on the piles of money stacking up each month in unclaimed benefits – recent figures from benefits calculator EntitledTo.co.uk, show that the total amount unclaimed per year, across all benefits, is £15.9billion.

OFFLINE AND OVERPAYING

It has also been shown that those without internet access are more likely to pay more for everyday items, unaware of the best deals that exist online. Lloyds Bank consumer digital index report 2020 found that 11.7 million people at the wrong end of the digital divide, are more likely to be paying higher household bills irrespective of income, household, or age. For utilities alone, many are spending an average of over £348 more per year. 

It is no wonder that the UK’s need for debt help is predicted to increase 60% by the end of 2021 (according to the latest warnings from the Money and Pensions Service).

However, the gap between thinking about digital and thinking about finance is huge: “More and more financial services are going online but they are being designed on the assumption that we all have smartphones – there is a complete lack of awareness,” says Emma Stone, from Good Things Foundation. Stone says it is not simply a case of the larger financial companies designing better, but also the smaller start-ups in the Fintech space who are developing new apps and products every day. 

This is where the Nobody in the Dark campaign comes in. Its design is informed by the people it aims to help and it links to practical tools, like the Quids in! Future-Proof Your Finance Quiz. It also signposts the training resources provided by LearnMyWay, which start with the basics such as learning how to use your smartphone or tablet, how to search the internet, how to use email, online forms, video calling and more. It also breaks down more ambitious subjects including how Universal Credit works, and using a benefits calculator.  

Quids in! and our partners are not the only ones trying to bridge the digital inequality gap. We Are Digital has a new partnership with Lloyds Bank, Mental Health UK and The Silver Line, and provides a specialist phone line for customers to access the internet, for the over-70s to obtain tablets, and digital skills training.

Behind a lack of digital engagement lies an ingrained fear of online safety, which poses another barrier to people going online. This is especially true when it concerns money. At Quids in!, we are increasingly aware of people’s fear of data protection, possible scams and fraud, not only through interactions in our centres but also through queries via our website. “Being safe online is at the heart of having digital skills – it doesn’t remove the responsibility of the tech industry and the big corporations but it’s a place to start,” says Emma Stone.

That’s why online safety tools have been incorporated into the Nobody in the Dark campaign, with tips on how to protect personal data on social media sites like Facebook, using passwords or shared devices. 

The need for these collaborations has never been greater; over half of people (54%) surveyed by YouGov do not have any or enough savings to support them through an economic downturn. The increase in online shopping, contactless payments and the possible phasing out of cash – these are things that are here to stay: “We aren’t going back from this,” says Emma. “If what this means is that living ‘offline’ starts to become more expensive, then we are further widening the inequality gap.” 

While all of the above won’t be news for many of us in the sector, it should give some comfort that some things are moving in the right direction at last.

A volunteer summed it up perfectly in a blog post on the APLE Collective website: “For years it has been expected that everyone on Universal Credit, people that sometimes struggle to put food on the table… are expected to record everything online. 

“If you’re unlucky enough to need mental health treatment or you’re in recovery from addiction and you have no access to a laptop, a tablet or even a smart phone you are kind of being left to your own devices which is quite dangerous… If any of these happen, your only option right now is telephonic or online help. This doesn’t make sense to me. There has been a historic indifference towards people of low income that needs to be addressed.”