Older people excluded financially

Older people excluded financially 


By Geoff Adams-Spink
Age & disability correspondent
BBC News website 
07.02.07
 


Older people are being left behind by the financial services industry, according to a report by Help the Aged.


As a result, many are struggling to manage their money, pay their bills and obtain credit.


Help the Aged blames advances in technology, post office and bank closures and financial institutions’ inability to serve older customers.


The organisation is urging the government and the finance sector to protect face-to-face services.


Called Financial Exclusion Among Older People, the report details the reasons for the marginalisation of pensioners.


‘Older people are finding the new financial services landscape incredibly challenging,’ said Help the Aged’s senior policy manager, David Sinclair.


‘The onset of new technology such as chip and pin, combined with deliberate policies to close branch networks, means that many pensioners don’t feel confident enough to access mainstream facilities which many other people take for granted.’


Mr Sinclair said the most worrying aspect was that neither the government nor the financial services industry are doing enough to plug the gaps left when traditional services are wound up.


The report contains a number of recommendations that would improve older people’s access to financial services:



The Post Office Card Account – or POCA, which is due to end in 2010 – urgently needs to be replaced because many people rely on it to access their money
High street banks should establish advisory groups so that older people can ‘quality check’ the accessibility of their services
Banks should share facilities where single branches are not considered viable
The government should provide more financial education for older people to ease the transition from cash-based transactions
The government should set targets to reduce pensioner poverty
‘The industry must work harder to engage with older people and reflect their concerns and needs,’ Mr Sinclair added.


‘At the same time, ministers must answer how the services provided by the local post office will be filled as yet another harsh branch closure programme begins.’


The British Bankers’ Association (BBA) pointed out that there are now more ways of banking than ever before and that while older people may be less familiar with the internet, most are comfortable with using the telephone.


It said that basic bank accounts opened after April 2003 are accessible through post office branches.


‘Banks do not take branch closures lightly and in general a branch closes because customers aren’t using it,’ a spokesperson said.


The spokesperson said that an independently assessed pilot scheme into banks sharing branches – carried out in 2002 – did not go down well with customers.


And the BBA said it supported Help the Aged’s call for a suitable replacement to be found for the POCA.


The governments has said it will spend £1.7bn on services including the provision of 4,000 free-to-use ATMs and 500 new outlets in small, remote communities.


‘There will also be new access criteria…[to] ensure that rural communities and customers in deprived urban areas will continue to have reasonable access to post office services,’ the Department of Trade & Industry said in a statement.


The Department for Work and Pensions (DWP) said that it was committed to replacing the POCA and will put the product out to tender.


It also pointed out that there are now 25 basic bank accounts which offer more flexibility than the POCA and that can be accessed at post offices.