Financial Health Forum: 15 June 2010

Wednesday 15 June 2011 Incomes and Inequality

The Financial Health Forum met on the 15th of June. The two subjects for in-depth discussion were the Consumer Financial Education Body (CFEB) and Money Guidance and the findings of new research by Policis into high cost credit and low income users. Chris Pond, the new FSA Senior Adviser to the CFEB, provided an update on CFEB and Money Guidance. He explained that CFEB had been established and is independent of the FSA, although the FSA appoints its Chief Executive. Chris also said that the Money Guidance phone and web services are running but the face-to-face tender process has been slowed down so that the new Financial Health Check can be incorporated in to the service.

Danielle Walker-Palmour, Director of the Friends Provident Foundation, presented the findings of new research by Policis into high cost credit and low income users. She explained some key findings:

  • The high cost credit market provides a source of credit to users who struggle to get it elsewhere
  • The credit was often being used to cover urgent bills or to cover a sudden squeeze or shock to the family’s budget
  • Users often chose this market based on the convenience and speed involved, including a lack of default charges or need for a credit rating

Finally, Lee Savage updated the Forum on his progress in developing a Financial Health Index, stressing the importance of using the correct indicators. The Forum discussed where the Index would most sensibly sit – in government, the third sector or elsewhere.