Exploring the impacts of improved financial inclusion on the lives of disadvantaged people

Abstract

This thesis examines the consequences of gaining access to financial products and services and of becoming more capable of using these (i.e. financial inclusion). In particular, the study aims to investigate the key processes which promote financial inclusion and the wider consequences of becoming financially included for the individual concerned. This work is based on qualitative interviews with 41 users of third-sector organisation which play a significant role in the government’s financial inclusion strategy. All agencies were involved in the promotion of financial inclusion, either through the provision of financial services, advice, or education. Respondents were drawn from seven out of 19 agencies which were initially interviewed in order to explore the field. The research also aimed to capture the longer term benefits of using financial inclusion initiatives and becoming financially included. This was achieved through the accomplishment of follow-up interviews with a sub-sample of 24 interviewees approximately one year after the first interview. The discussions with service users explored the experience of disadvantaged individuals in terms of financial exclusion prior to coming into contact with one of the participating agencies and how their life circumstances had changed following contact in an in-depth manner. The first four chapters of the thesis provide the theoretical, empirical and political background for an understanding of the concept of exclusion from financial services, its consequences and what can be done to tackle the problem. Chapter 5 sets out in detail how the research was conducted and the data analysed. The following two chapters, then, look at the impact of financial inclusion policies on the lives of disadvantaged people through the discussions with service users. The concluding section of the study reviews the main findings in light of the research questions. It suggests the significance of financial inclusion in social inclusion processes, but also the limitations of the extent to which financial inclusion can radically change the life circumstances of individuals. This highlights the need for policy makers to tackle both direct barriers of financial exclusion as well as its underlying causes such as low income.