Back Log out
Industry News

The future of responsible lending and financial inclusion in 2021

Sercle Team


What is financial exclusion?

1 in 4 families in the UK receive a low income of around £144 to £401 per week and face financial exclusion1. This means they have little or no savings and can’t access credit based on their income. They may also be charged higher interest rates. If they have a bad credit rating, they may not receive any credit at all.

This means surprise payments, such as repairing a boiler, can cause serious financial hardship.

What is financial inclusion?

Financial inclusion refers to everyone receiving equal opportunities and access to financial services such as banking, loans and insurance products, regardless of their circumstances.

What is responsible lending?

Responsible lending calls on all financial lenders to act in the customer’s best interest to make sure products are affordable. The borrower is supported if they cannot repay the loan. Similarly, the terms and conditions are completely clear and understood by the borrower.

The impact of Covid-19

Those who are financially excluded face higher fees and limited access to online banking services. The impact of the Covid-19 pandemic was, in some cases, catastrophic.

Covid-19 increased the rate of digital adoption by the financial services sector. The circumstances and restrictions forced people into new, unprecedented behaviour patterns. This inevitably changed many financial organisations’ focus to digital, leaving behind those already financially excluded.

35 percent of customers increased their online banking usage during the pandemic2 and contactless payments soared, whilst many high street banks closed or restricted services, leaving those customers who rely on cash in further financial hardship.

Whilst many workplaces and businesses managed to bridge the gap to digital during the pandemic, it may have widened for those whose access to online financial services continues to be restricted and overlooked by financial organisations.

The future for responsible lenders

Traditional high street banks have steered clear of promoting financial inclusion as their existing approach focuses on increasing profit rather than a truly customer-centric approach.

However, banks are focusing on becoming more agile. This includes streamlining their capabilities and developing their digital offering to customers, rather than targeting those financially excluded.

In comparison, there are some financial organisations championing financial inclusion across the sector.

As responsible lenders, promoting good money management and providing loans with fair and reasonable rates, credit unions have always supported and spearheaded financial inclusion.

Since the pandemic, more and more consumers are struggling with their finances and looking for support from alternative lenders. This has created a significant opportunity for credit unions to lead the way in the industry. Credit unions can empower their members and attract new applicants with responsible lending practices.

With the increase in fintechs globally, comes the promise of more financial inclusion. Technology is enabling the design and implementation of new, innovative services to increase financial inclusion across the industry, something that traditional banks and credit unions have previously struggled with.

Credit union solutions: Sercle Platform

Sercle Platform provides credit union accounting software to support growth through cutting-edge technology. Sercle Platform has been carefully designed around the needs of our credit union partners and their members, supporting financial inclusion.

Setting the industry standard for best in class technology for over 30 years, Sercle Platform continues to add new features to ensure credit unions and their members are supported as the financial landscape evolves.


Join hundreds of credit unions integrating the Sercle Platform, credit union accounting software to support growth through cutting-edge technology.