Better Banking Campaign
London Rebuilding Society is one of the organisations running the Better Banking Coalition.
The Coalition campaigns for legislative and regulative changes to the banking system to help ensure that fair and affordable finance is available to all.
Many people, businesses, and community-based organisations in low-income areas find they are unable to access credit and financial services at fair and affordable rates. This will have more to do with a lack of credit history then their ability to pay back a loan.
The problem is that financial institutions do not understand the needs and potential of these borrowers, so do not accurately assess the risk they represent. As a result communities with the greatest need for finance and with some of the greatest potential for growth are underserved.
The figures speak for themselves:
· Approximately 5 – 7 million people cannot access credit because they do not have a bank account or a credit history
· Around 25,000 businesses a year with viable propositions are unable to access credit
· The UK has the highest rate of failure amongst small businesses across all OECD countries – a statistic largely attributable to undercapitalisation.
This not only adversely affects the wider economy but also stifles regeneration and increases poverty rates amongst lowest income groups. To address these issues the Better Banking Coalition is campaigning for:
· Full financial disclosure by financial institutions,
· A cap on unfair credit rates for those who cannot afford them
· Incentives for banks to demonstrate that all who merit it have fair and equal access to credit.
These changes would encourage a mutually beneficial relationship between the banking sector and low-income communities by increasing provision of finance for the businesses and communities that need it most, as well as opening up new markets for banks.
In America, the introduction of the Community Reinvestment Act (CRA) requiring banks to “meet the credit needs of the local communities in which they are chartered, consistent with safe and sound operation”, resulted in millions of extra dollars being directed towards the most disadvantaged and underserved communities.
Please lend your support to the campaign by signing up and allowing us to list you as an official supporter. See our campaign website for further details: http://www.betterbanking.org.uk/. Should you have any questions please contact Lucy Marples at (lucy.marples@acevo.org.uk, 0207 280 4926).
Many thanks.