Financial inclusion - four tips to level up

Considering your DE&I goals when building your financial wellbeing strategy will embed financial inclusion in your organisation, and generate upticks in HR and business metrics as a result.

In response to our recent research and data surrounding financial exclusion , who is most impacted in work and society, and the challenges they're facing; we make four key recommendations for employers.

ONE

Review your workplace policies and benefits through the lens of DE&I and prioritise providing financial benefits that are useful and accessible for the whole workforce.

?Reviewing policies and practices, particularly those financially-adjacent, through a DE&I lens, is essential for employers to ensure equitable access, address systemic biases, and promote employee engagement and retention. As a starting point, employers can promote DE&I in financial policies by ensuring diverse representation in decision-making, regularly reviewing policies for biases, and offering benefits which are holistic and beneficial to large amounts of your workforce - particularly those in the financially-excluded category . Measurement and accountability are crucial for progress here - the best answer you can get to the question: 'What do my workforce need?', is to actually ask them.?

TWO

Provide support for your workforce to discover and apply for state assistance they’re entitled to receive.?

There can be a level of self-consciousness and stigma around state support, which in turn breeds misinformation on what is available, and who is entitled to it. Many individuals may be unaware of the aid they are entitled to, characterised by the ￡19 billion that is left on the table each year - which could be helping families ease financial burdens around childcare, utilities, and groceries. Tackling this subject is twofold, any and all conversations that can be facilitated around money (Mental Health Awareness Week in May or Talk Money Week in November are good initiatives) can help de-stigmatise the subject; and also utilising services which allow colleagues to quickly and easily calculate entitlement (such as Inbest's online calculator) can help them unlock their entitlement.

THREE

Implement a payroll savings programme and ideally structure it on an opt-out basis so that employees build up savings by default.

Opt-out savings models are by no means a recent innovation. Looking at the majority of pension schemes, it's a long-established fact that helping employees save by switching the default from 'opt-in' to 'opt-out' can make a huge different to savings levels, one of the pillars of financial wellbeing, and arguably the greatest provider of financial security. Applying this concept to short-term and liquid savings, is something that is a less-explored concept. Wagestream has worked with Nest Insight to trial opt-out savings with some key UK employers, and results show that the percentage of the workforce saving when in an opt-in vs. opt-out model jumps from 16% to 71% - no small difference.

FOUR

Aim to meet the standard for living hours, as provided by the Living Wage foundation.

By ensuring that employees earn a wage that covers the basic cost of living, you centralise financial wellbeing as the bedrock of your organisation - and have a solid foundation to build out your strategy from. As previous research has shown, financial worries can have an extreme impact on cognitive capacity, up to 13 IQ points ; if you can alleviate some of this stress from your workforce - you can foster a more motivated and loyal colleague community, who can ultimately provide a better service to your customers.

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