The FCA in partnership with FinTech Scotland launched a Financial Inclusion TechSprint on 7 March 2024, culminating with a Showcase Demo Day on 30 May.
This was the first time we have partnered on a cohort model sprint. This partnership opened opportunities for off-ramping solutions, and reflected our desire to ensure all UK citizens can access basic financial tools and services.
Applicants were invited to create teams, either from their own organisation or partnership with others, to address set challenges over a 3-month period.
The 12 participating teams were given access to FCA Financial Lives Survey[1] data and synthetic data the FCA’s Digital Sandbox, to enable them to develop their innovative solutions around 3 main problem statements.
Problem statements
- What technological solutions can help to increase the probability of consumers being accepted when they apply for everyday financial services, such as basic bank accounts, credit or insurance products?
- What technological solutions can help to deliver positive outcomes for consumers when a firm declines their application for a product, or when at a subsequent point in the consumer journey they become excluded because the product is no longer suitable for their needs?
- How can technology, including AI, be deployed to ensure that firms deliver good outcomes across the board to groups of consumers who have been excluded or not well-served in the past, particularly in retail banking, payments, credit and insurance?
Benefiting from a pool of external mentors, we were able to provide access to a broad range of expertise. We also hosted several teach-in sessions for participants on different topics, including:
- Data Protection by Design and Default by the ICO Innovation Hub.
- Financial Lives data debrief.
- The Online Safety Act, age assurance and Digital ID by Ofcom.
- Barriers to account opening and lessons from branch closures.
- Improving outcomes for financially vulnerable consumers.
- How additional data sources can support financial inclusion.
- Experian consumer research on credit invisibles and thin files.
Showcase Demo Day highlights
The Showcase Demo Day was held at the Technology & Innovation Centre, University of Strathclyde, Glasgow. In choosing Glasgow, we wanted to shine a light on its thriving fintech industry, while also acknowledging the region’s economic challenges.
Participants showcased their solutions to an audience of nearly 250 people.
The day was structured to provide a comprehensive overview of financial inclusion initiatives and innovations.
The event opened with welcome remarks from Sheldon Mills, executive director of consumers and competition at the FCA; and Nicola Anderson, CEO of FinTech Scotland, who talked about the role of technology in financial inclusion.
This was followed by a panel discussion with the judges and hosted by Greg Sachrajda, director of cross-cutting policy and strategy at the FCA, which also provided an opportunity to consider broader themes incorporating various perspectives and first-hand insights.
Judging panel
The panel included:
- Sheldon Mills, executive director, FCA
- Nicola Anderson, CEO, Fintech Scotland
- Charles Randell, financial inclusion commissioner and senior consultant, Slaughter & May
- Noyona Chundur, CEO of Consumer Council Northern Ireland
- Colin Halpin, global head of market data management at Barclays and a board member at Scottish Financial Enterprise
Award categories
During the showcase, judges assessed each presentation based on agreed criteria.
The 4 categories included the:
- Fast Solution
- Eureka Solution
- Jump Solution
- People's Choice
Other solutions
You can read more about all of the solutions developed for the 3 problem statements, as well as watching video clips of the team presentations.
Problem 1: acceptance for everyday financial services
BucksTrybe
A solution that uses a mobile app - combining open banking solutions with alternative financial data from informal peer-to-peer lending and Rotational Savings and Credit Schemes. The app tracks and reports this previously overlooked but valuable alternative financial data, thereby enriching thin credit lines and bolstering individuals’ creditworthiness.
This would enhance the credit visibility of vulnerable groups such as immigrants and young individuals in the UK by leveraging seemingly invisible transactions to establish credit profiles.
BucksTrybe's innovative approach to addressing credit history challenges for immigrants through a community-focused solution was noted during the judging process for the Eureka Solution.
Video: watch BucksTrybe's presentation
Faciit
This solution leverages open banking, implementing a save-to-borrow framework, coupled with a robust risk weighting system and advanced machine learning algorithms to help near-prime borrowers with thin or no credit profiles access competitive loans. Users save one-third of their finance requirements for a minimum of 3 months and are then matched to lenders who give the remaining two-thirds as competitive loans.
Video: watch Faciit's presentation
Poli / Newcastle University
This solution leverages AI to simplify T&Cs, equipping users with the knowledge to engage with terms and select appropriate financial products, making financial and legal documents clear and understandable for everyone.
Key features include:
- Visual Navigator: Presents T&Cs in a visual format, allowing users to quickly review and navigate specific sections.
- Highlighted Connections: Links relevant sections to address common issues in AI summarisation, ensuring coherent and comprehensive understanding.
- Multilingual Translation: Provides T&Cs in various languages to enhance comprehension.
Video: watch Newcastle University's presentation
Problem 2: outcomes for rejected / excluded consumers
Fastcheck
This platform offers an instant quote display system that personalises finance quotes and provides clear, actionable feedback for users who face rejection.
Through the decision engine, consumers facing financial product rejection, or those who find their circumstances have changed, will have access to real-time refinancing options, including changes they can make to requalify for a lender or finance product and alternative financial products and lenders.
Video: watch Fastcheck's presentation
Lloyds Banking Group
The solution being developed is an ‘Accessible Credit Referral Process’. This is intended to provide more support to their staff in order to better serve their customers by creating a safe pathway to third parties who will support customers to access affordable credit from responsible lenders.
They will also provide prompts for customers to explore how they can maximise their income in the future through a benefits calculator.
Video: watch Lloyds Banking Group's presentation
NatWest
Working with Fair4All finance this solution supports customers access to affordable credit. They aim to identifying specific journeys for customers post decline by personalising their needs.
Predicting customers who may apply in the future and be declined, this solution can intervene at an earlier stage to increase the likelihood of a customer receiving a better outcome.
Video: watch NatWest's presentation
Problem 3: using technology to improve outcomes
Zühlke
This AI framework aims to identify bias in data. Their solution takes a rounded view of what matters – with a unique each use-case approach. Emphasising the value of inducing known changes in synthetic data to understand how bias impacts answers.
The solution embraces a balanced scientific quantitative approach, which is a step beyond qualitative checklists. Outputs include interactive visualisations to aid decision making.
Video: watch Zühlke's presentation
GAIN Credit
This AI solution enhances financial health and minimises borrowing needs, thereby fostering financial inclusion and enabling access to responsible credit.
Consumers benefit from actionable insights that elevate their financial skills and creditworthiness, improving their prospects for obtaining crucial financial services. Conversely, lenders benefit from a more financially sound and creditworthy customer base.
