FCA reveals the financial experiences of people in the UK: More than half of people in Scotland are potentially vulnerable

Today’s report finds that 54% of people in Scotland are potentially vulnerable compared to the UK average of 50%.

Financial Lives is the FCA’s survey of nearly 13,000 adults and is the largest tracking survey in the UK specifically looking at consumers and their use of financial services.

The report shows a number of differences in how people in different areas of the UK, including Scotland, experience financial services, such as:

• Scottish attitudes towards finance are more positive than elsewhere in the UK: 42% of Scottish adults are highly confident managing their money compared to the UK average of 37%. In addition, 25% are highly satisfied with their financial position compared to the UK average of 21%, and 18% are highly knowledgeable about financial matters compared to the UK average of 16%.
• There is an above-average concentration of adults with high-cost loans in Scotland. While overall use of consumer credit products is similar to the UK average, of the 3.1 million UK adults with high-cost loans, 0.4 million are in Scotland (8% of people in Scotland have high-cost loans which is higher than the UK average of 6%). In addition, more people in Scotland have motor finance (16% vs. the UK average of 10%).
• 8% of adults in Scotland are in financial difficulty and 13% are over-indebted. These figures are similar to the UK averages.
• On average, adults in Scotland owe more in unsecured debt - £3,400 compared to the UK average of £3,320.

Andrew Bailey, FCA Chief Executive, said: 'This survey shows just how different the experience of financial services is for consumers across the country. That’s important for us, as we shape financial services policy. But it is also important for firms, as they decide how best to serve their customers.'

The FCA has released weighted data tables which provide details of the survey findings so that local decision-makers and other organisations can use the information to consider what they can do to help support people who may be struggling financially. The FCA’s previous Financial Lives report told the financial story for six different age groups to show key themes at each life stage.

Notes to editors

1. Read the FCA’s June 2018 report, The financial lives of consumers across the UK[1]
2. Read the Financial Lives 2017 report, Understanding the financial lives of UK adults[2]
3. Potential vulnerability refers to those adults who may suffer disproportionately if things go wrong because they have low financial resilience. It also covers those who may be less able to engage with their finances or with financial services. The reasons for this can vary from suffering a recent life event (such as redundancy, bereavement or divorce), low financial capability, or a health‑related problem that affects a person’s day‑to‑day activities a lot. Being defined as potentially vulnerable does not mean someone will necessarily suffer harm.
4. ‘In difficulty’ refers to adults who are the least financially resilient, as they have already missed paying domestic bills or meeting credit commitments in at least three of the last six months.
5. Over-indebtedness is defined as considering a heavy burden keeping up with domestic bills and credit commitments, or missing any credit commitments and/ or any domestic bills in any three or more of the last six months.
6. On 1 April 2013, the FCA became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the Prudential Regulation Authority (PRA).
7. The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
8. Find out more information about the FCA[3].