The inclusion gap undermining financial wellbeing strategies

How employers can incorporate financial inclusion into their wider benefits offering to employees.

Employers act as major levers in helping to improve financial wellbeing and financial inclusion in the workforce, according to the government’s Financial Inclusion Strategy.

The strategy states financial inclusion is how people can make their money work well for them, become more self-reliant, which in turn enhances physical and mental wellbeing, focusing on:

digital inclusion and access to banking
support for savings
financial resilience through insurance
access to affordable credit
tackling problem debt
financial education and capability.

But what can employers do to ensure their wellbeing strategies promote financial resilience?

Support for savings

One of the strongest recommendations from the strategy is for employers to implement workplace saving schemes. These help staff to build financial resilience by starting and maintaining a savings habit with a view to providing a financial safety net.

These saving schemes should be easy to access, so that they have the option to draw from the savings as and when needed (rather than get into debt). Where workplace savings have been implemented, companies have found measurable positive outcomes including improved staff attendance and reduced financial stress.

Increasing resilience through insurance

Financial exclusion often begins when an employee’s usual income stops or reduces. By offering group income protection products, enhanced sick pay schemes, employers can help stabilise household finances when staff face illness or injury, key causes of income reduction. Where this isn’t an option, employers would consider signposting staff to assistance programmes or affordable insurance options.

Employers can also provide income maximisation tools to help employees check eligibility for benefits and discounts such as council tax reduction by integrating benefit-check tools into HR portals or wellbeing hub.

Improving access

If employees don’t know how to (or can’t) access any benefits offered, they miss out.

This is especially important when considering digital capability as this is linked to financial capability and the Strategy notes that millions struggle with digital access to financial services including online banking, and improving digital skills directly supports financial inclusion.

Ensuring internal financial tools or HR systems are accessible to all employees is key. To help, employers can support employees with digital skills training and provide access to devices (iPad/laptops, SIM cards) which could be loaned by employers or purchased through employee loan schemes.

Education and training

Wellbeing strategies can offer plenty of services to beat financial exclusion but without education and training, employees may not understand what’s being offered or how to get the most from them. This can exacerbate issues and cause employees to make misinformed financial decisions.

To support employees with reduced money skills employers can provide access to high-quality financial education by hosting learning sessions, supported by the Money and Pensions Service.

Sharing trusted tools like MoneyHelper and benefits calculators with employers and embedding financial skills training into staff development (through workshops/online portals). Importantly, when offering learning employers should consider employee working patterns and schedule appropriately.

HR teams should also be trained to spot indicators of financial or economic abuse, provide safe pathways to support (EAP, debt advice, domestic abuse charities) and follow emerging industry guidance on fair treatment.

Help with sensitive financial issues

The strategy emphasises the need for consistent, trauma-informed responses to economic abuse as financial abuse and vulnerability have a major impact on financial inclusion too.

Employers need to consider how to deal with employees impacted by providing advice which is essential to help people regain control. This can be achieved by offering support (through in company financial first aiders) and easy access to debt advice by signposting to free, impartial services (StepChange, Citizens Advice, MoneyHelper).

What else can employers do?

Employers don’t have to offer support alone. They can consider:

Partnering with credit unions and community finance providers who can offer access to safe, affordable credit through workplace accounts. The Strategy highlight these as key support for employees with thin credit files or low incomes.
Partner with debt advice organisations and provide confidential routes for staff to talk about financial concerns such as training other employee as money first aiders.
Bring in links or signposting to financial advisers. If specific to pensions, signpost employees the FCA’s incoming new targeted support service.
Consider joining the National Coalition of Employers on Workplace Savings which is being coordinated by MaPS, TISA, and Nest Insight. This will provide employers with credibility, access to best practice, support on implementing payroll saving and provide a route for employers to Influence national policy and programme design.

As I stated in my article last year, it’s important for employers to really know their employees to make sure the company’s wellbeing policies are relevant, easily understood, and accessible.

Show wellbeing packages to prospective employees and new joiners but make sure to check that existing employees are making the most of them too. If they’re not, examine why and make changes.