Finding policy solutions to digital and financial exclusion

03 Aug 2020 |Written by Sam Green

Lockdown has brought the relationship between digital exclusion and financial exclusion into sharp focus. As part of the Nobody in the Dark campaign, Good Things Foundation hosted a Zoom roundtable to explore how we can push for policy change to tackle the problem head-on.

The challenge

Digital and financial exclusion have always overlapped. Access to the internet opens up a wealth of opportunities, including access to online banking services, affordable credit and money saving deals. Research from Lloyds Consumer Digital Index (2020) shows that the most digitally engaged people are saving over £300 a year on utility bills alone.

So it’s no surprise that as the shops shut and the banks closed, digitally excluded people - those without access to the internet or the skills to use it - felt the bite of lockdown most acutely.

There are 1.9 million households without internet access in the UK, and 9 million people can’t use a device on their own. People who would previously have been supported at their local community centre to access the internet were left disconnected, denied equal access to financial opportunities.

Taxes, debt collection and other payments have been waived during the crisis, but this won’t last forever. When these payments are chased, it’s vital that people aren’t faced with a cliff-edge. Many people will be accessing benefits for the first time.

Financial support services such as free debt advice are expecting a surge in demand in the near future. There is a huge amount of help and support available online, but without digital skills or access to the internet, people will be unable to access it.

Opportunities to influence policy, regulation and practice

Digital exclusion and financial exclusion have been exposed, and there is a serious risk that they will continue to work together to exacerbate inequalities. Here are some of the issues and policy ideas we discussed at the roundtable.

Digital inclusion: access, skills and support

  • Is the internet now an essential service, like gas or electricity? Since being offline is a barrier to opportunities like finding a job or making online savings, should someone’s internet service be cut off if they can’t afford to pay for it? If it is, we need to advocate for policy-makers and providers to recognise this.
  • Greater commitment towards digital inclusion would certainly help. The Government is rightly investing £6.5 billion in broadband; even just 2% of this investment into essential digital skills would help to close the gap.
  • A new Digital Strategy is due to be published in the autumn - is this an opportunity for the Government to set out a cross-departmental approach to digital inclusion?

Data poverty

  • Data poverty is a term that has entered our vocabulary in the last few months, referring to unaffordable connectivity options (often reflecting a ‘poverty premium’).
  • Could the Government commission a Task and Finish Group, comprising people with lived experience alongside industry and charity sector leaders, to identify different ways to solve data poverty? Solutions might include data gifting - donating internet data to those who can’t afford it - and WiFi sharing schemes.
  • ‘Social tariffs’ were introduced to utilities markets to safeguard vulnerable consumers, providing a cheaper rate for people on low income. Is this a sensible approach to tackling data poverty?

Intersection of digital and financial wellbeing

  • Nobody in the Dark is a campaign and practice delivery project, identifying ways that online resources can help people be better off. It is a partnership between Good Things Foundation, Mastercard, Joseph Rowntree Foundation, APLE Collective and Clean Slate. We can use what we learn to inform interventions (policy and practice) which link digital exclusion and financial exclusion.

Joining the dots between digital exclusion, financial exclusion and poverty is more important than ever. Over the coming months, we’ll continue to work with partners in communities, industry, the voluntary sector and the Government to develop solutions for better lives and a stronger society.

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Nobody in the Dark