Thursday 22 April 2021 4:15 pm

Opening our eyes to financial inclusion for the good of the economy

Crypto AM Parliamentary Special

with Lord Holmes of Richmond MBE

Financial Services Bill: Reflections (part two of two)

Having lived the Financial Services Bill for the past three months I find myself now reflecting, not just on the clauses, amendments, debates and discussions, but more on the essence of financial services themselves: principles, purpose, point.

Why not dive back to the start? What is the point of financial services? Often described in terms of fluidity, flow and other liquid alliterations, I think it is more essential than this. More, financial services should be enabling, empowering, unleashing potential. More, so much more than transactional, the generators of value, growers of value in an immediately, inclusively connected relationship.

And I do not think it is too much to say that financial services are poverty stricken if they fail to include. If they are not for everyone, they are not, in any civil sense for anyone.

It was for this reason that I wanted to force thinking right through financial services, from Chancellor to consumer, from HM Treasury to us all on Main Street, thinking, at every beat point that financial inclusion was a key, essential golden thread so far not so fully spun.

It is an unquestionable positive that we have not one but two Ministers for financial inclusion, in the fine forms of Guy Opperman and John Glenn. This enables horizontal work streams to be led across Whitehall. But with millions still finding themselves at the sharp end of exclusion, we must do more. We need a deeper, whole of Government, and beyond, financial inclusion strategy.

One of my proposed amendments was, for the Bank of England’s Financial Policy Committee (FPC), an objective to monitor and act on financial exclusion. 

Revered around the world

The Bank has such a fantastic reputation, respected throughout the UK, revered around the world. It has the potential to play a key leadership role in respect of financial inclusion. 

It doesn’t seem that great a leap to apply the logic, sitting behind financial stability, to inclusion.  Currently the millions locked out of financial services, the under and unbanked, unable to access credit or play their full part, may well not be seen as systemic to the UK economy. But if we simply open our eyes wider, look harder and see how, through greater financial inclusion, it is possible to drive change and significantly strengthen the economy, thus, greater financial stability.

I suggested a similar amendment for the regulator. A financial inclusion objective for the FCA seems sage. The FCA’s consumer protection objective would certainly be strengthened through a greater focus on financial inclusion. Together with the Bank’s FPC this would provide a brace of regulatory activity to the purpose of inclusion.

Another related topic debated during the passage of the Bill was whether a duty of care placed should be placed on financial services regulators. Pushed, rightly, by so many organisations, in no small part by Macmillan Cancer Support but not, in the end, incorporated into the Bill. None of this disappears or falls away, it lives on, until the next legislative opportunity to push for change.

One of my amendments that was supported by the Government, the ability to get cash back without a purchase is now, hopefully, a heartbeat away from becoming reality.  If accepted by the House of Commons my amendment would enable greater inclusion across the community through this simple, effective change. 

Cashback without a purchase

Small remote retailers and businesses would be enabled, on their own account to offer cashback without a purchase. I drew the amendment deliberately permissively so as also to allow innovation. For example, in the form of third party business, now able to offer the service via a group of retailers, a High Street, a village, local community and so on. 

I believe the amendment will improve inclusion, be good for individuals, good for communities, good for business and our collective Covid build back. Cashback for a better build back.

The financial services future regulatory review, in flight, also should be seen as an effective vehicle to load up with financial inclusion imperatives. How the regulators are scrutinised and held accountable is vital and still very much to be clearly drawn out. A key piece of this future regulatory framework must be the regulator’s greater grip on inclusion, they have a privileged position to drive the difference, they can, they must.

Finally, whether crypto or cashback, duty of care or digital instruments, what the Financial Services Bill has taught us is how much business, not least financial services business, is all our business. As it is in the public services, it is us, all of us who put the money in. We have to care how it is directed and deployed, and how inclusion, financial yes, but inclusion in all its bright, brilliant diverse forms runs right through it all. 

Inclusion, something well worthy of the title, golden thread. A golden thread capable of delivering on that gold, that cash, those stable coins, crypto assets, CBDCs. Financial instruments in symphony for the benefit of individuals, business’, communities, cities and our country.   


Lord Chris Holmes is Vice Chair of the Parliamentary Groups on: FinTech, AI, Block Chain and 4IR.  He has co-authored Lords Select Committee reports on: Digital Skills, Social Mobility, Financial Inclusion, AI, Intergenerational Fairness and, last year, Democracy and Digital Technologies.  He also authored a report on ‘Distributed Ledger Technology for public good: leadership, collaboration, innovation.’

Further detail about amendments to the Financial Services Bill can be found on Chris’s Blog:



Twitter: @lordchrisholmes