The London Assembly Economy Committee report ‘Short changed: the financial health of Londoners’, published in January makes a number of recommendations for the Mayor of London, including:

  • Work with the financial services industry, schools and colleges to create a young person’s banking charter, with the aim of ensuring all 16-18 year olds has a bank account. The Charter should include a commitment from banks to provide young people with a bank account by default.
  • Commission an annual survey of London households on their financial activity, in order to get a better understanding of London’s ‘underbanked’ communities.[6]
  • Hold a Money Advice Week to promote affordable credit and use TfL advertising space to promote credit unions.
  • Work with schools, charities and the financial services industry to deliver high quality financial education for young people.

Some of the reports findings include:

  • 44% of people in the UK, who are in financial difficulty are between the ages of 18 and 34.
  • Around a quarter (27%) of 18 to 30 year olds in London say they are in debt all the time.
  • A third of all users of high-cost loans are 18-34 year olds.
  • 40% of 18-24 year olds are less confident about managing their money, compared to 22% of the rest of the UK adult population.

Caroline Russell AM, Chair of the Economy Committee, said: “The cost of living has increased in the capital and many Londoners are cut off from accessing affordable financial services, such as loans and credit cards. They have to turn to high-cost credit, like payday lenders to make ends meet.

The Mayor of London has committed to tackle financial exclusion in London. While technology and innovation is one part of the solution, we want the Mayor to show real leadership in improving the financial health of Londoners.

It is absolutely crucial that young people are given the right support in terms of their finances, when they leave school. For many, it is the first time they will be responsible for their own money.

Education and support are key, as actions at this critical stage can have real consequences, in terms of credit ratings and long-term financial health. We strongly urge the Mayor to target his efforts in helping this group specifically.”

(Source: London Assembly Economy Committee)