Muna Yassin MBE (pictured), CEO of Rooted Finance, worked with non-profit organisation Fair4All Finance on its report which looked into which barriers preventing people from ethnic minority groups from accessing financial services.
Yassin sat on the advisory board which assessed a range of products including credit, mortgages and debt. It found “there were systemic level of barriers to access and there are also areas of discrimination. There are gaps in data, meaning there are quite a few areas we could have focused on,” Yassin said.
She said a lack of representation in financial services meant many issues were “cascaded down”.
“If you haven’t got people who are of that culture or of those experiences designing and making policy or even factoring in the risk, then that has a big impact on how people access these services and products, or what is available to them,” Yassin said.
She said firms needed to recognise that they had blind spots when it came to people from underrepresented groups and said collaborating with charities and organisations could help to identify these.
Yassin said this could give firms “insights and support you in being able to access those communities”
“The most important thing is to think about your internal structures, your processes, your recruitment, your retention, your promotion, your ability to keep talent within the organisations because they feel that they are contributing to their communities,” she added.
Benefits of financial literacy
Yassin said there were “swathes of people” who could struggle to get a mortgage because the road to becoming credit-worthy after being in financial difficulty was “very long”. She said education was needed around the steps to be able to get a mortgage and think about buying a home.
Yassin said it would help to capture data from credit reference agencies too, to incentivise people who repaired their credit to continue with good behaviours so they could access products and services.
She said there was an advantage to being financially sound as it was hard to plan “when you’re in day-to-day survival mode”.
“The more that we focus on long-term financial stability as opposed to just short-termism, you build up resilience within those communities and there’s less reliance on state support. It’s good for all of us and society in terms of the economic benefit but also, healthy wealthy communities,” Yassin added.
Engaging with underrepresented groups
Yassin said face-to-face communication tended to work better for underrepresented groups, as does having someone who represents them as it makes for “better engagement and understanding”.
She said having someone from a shared community acting as the “conduit for information” and making it relatable was better than generic information that does not always apply.
“For remote channels, often video resonates the best, as again, that visual connection to someone who looks and has a similar background can break down barriers. The ability to ask questions in a safe space and environment feels like a key factor here,” she added.
Younger people seem to prefer video communication, social media and trusted sources of information, Yassin said while older people and those with financial difficulties wanted to speak with someone in person or group settings where they feel comfortable.
Rooted Finance’s work
Rooted Finance helps people in financial difficulties to manage their debt with a solution which takes their income and expenditure into account, to resolve this through a repayment plan, an insolvency process and a pause or reduction on repayments.
It also helps people to stabilise their finances by thinking about long-term financial goals, asset building and saving.
Yassin said the charity was open to everyone but found many of its clients came from underrepresented groups and ethnic minority backgrounds. Unlike mainstream providers, the Charity reflected the communities it served, ensuring culturally appropriate and expert-by-experience services.
“Often, they have less income in comparison to other population groups and often, they have more debts which then impacts their ability to build assets because they’re starting from a disadvantaged position,” she added.
Rooted Finance is readying to launch its Racial Justice Network project later this year which will take on recommendations from the report and look at cultural representation in financial services and inclusive design. The project is funded by the Trust for London’s racial justice fund.
