Financial Inclusion for Scotland makes strides in first year of strategy but calls for help from dormant assets funding.
Financial Inclusion for Scotland (FIFS) has warned that Scotland risks being left behind by the rest of the UK in the fight to tackle financial exclusion among its most vulnerable communities and individuals.
The warning from FIFS comes after the UK Government recently reconfirmed its decision to allocate an extra £87.5million in dormant assets funding to financial inclusion in England and Wales over the next four years, through Fair4All Finance.
At present, funding from the Dormant Assets Scheme in Scotland is used to fund youth projects.
The recent expansion of the scheme to include other financial sectors including pensions and insurance will deliver an additional £74m for Scotland, presenting an opportunity to direct a proportion of these assets towards financial inclusion initiatives, without impacting existing funding commitments.
A key pillar in FIFS’ inaugural Financial Inclusion Strategy, published in May 2024, is the establishment of a £20m Investment Fund which would be instrumental in bolstering community lenders and expanding the availability of affordable credit.
Stephen Pearson, chair of FIFS, said: "People in Scotland are facing unique financial inclusion challenges that require targeted solutions.
“The disparity in dormant assets funding between Scotland and the rest of the UK threatens to create a two-tier system of financial inclusion, leaving Scotland behind.
“We must act now to seize the opportunity presented by the expanded Dormant Assets Scheme to ensure Scotland's most vulnerable communities aren't left behind.
“Our proposed £20m Investment Fund could be transformative in expanding affordable credit access through community lenders, but we need the funds to make this happen.”
FIFS is delivering a progress report on its Financial Inclusion Strategy at a Scottish Parliament reception, to be attended by around 80 stakeholders from across public, political and civic life.
Since launching its ambitious strategy, FIFS has established itself as a leading voice for financial inclusion. The organisation has made substantial progress in advancing financial inclusion across Scotland through policy engagement, political advocacy, and other initiatives.
