Guest blog: Equipping consumers with the right tools to make better financial decisions

Dominic Stewart, Campaign Manager, Keep Me Posted UK, considers the advantages of paper billing for consumers.

Financial inclusion is on the minds of politicians, regulators, businesses and consumer advocates but the debate often focuses on wider structural changes to the financial services industry rather than developing the tools, which are already available to some consumers.

Independent research, conducted on behalf of the Keep Me Posted campaign by London Economics in 2015, found that consumers in receipt of paper bills were more likely to understand financial information and make better financial decisions when they receive information by post rather than electronically. Sounds almost too easy, doesn’t it?

From a sample of 2,300 consumers, 82% of those surveryed were able to recall their balance when in receipt of a paper bill in comparison to a meagre 32% from electronic copies.

That is why the Keep Me Posted Campaign champions the right of all consumers to have the choice to receive, without additional financial penalty, paper bills and statements.

Vulnerable consumers

We have become increasingly concerned by the extent to which consumers, considered vulnerable, are disproportionally impacted by the drive to digital. Consumers living with disabilities, in poverty or indeed rural areas have a greater chance of digital exclusion which, in turn, exacerbates levels of financial exclusion.

According to the Office for National Statistics, almost 1 in 10 UK adults have never used the internet, which is a number disproportionately made up of vulnerable consumers.

Christians Against Poverty explored the link between digital and financial exclusion in their recent research Offline and Shut Out which concluded that those in debt are less likely to have personal access to the internet with only 1 in 10 having access on a smartphone.

The government now defines vulnerability as a dynamic concept. We can all be vulnerable at different stages in our lives. Businesses therefore have a responsibility to ensure that their customers have all the necessary tools and safeguards to make effective financial decisions.

As such, we have built a coalition of over 100 charitable organisations working in the field of vulnerability including Age UK, Mind and the Joseph Rowntree Foundation. All our supporters champion the consumer’s right to choose, without financial penalty, paper bills and statements.

We are proud to welcome our newest supporter, RSPH, to the Keep Me Posted coalition. RSPH’s recent report Life on Debt Row, in conjunction with actor Michael Sheen, explores the link between debt and mental health and we will continue to explore this link through our own campaign.

Protecting 90 million transactional relationships and beyond

We award the Keep Me Posted “Best Practice” Mark of Distinction to organisations who commit to consumer choice and offer paper bills at no additional cost.

HSBC, Barclays and the Royal Bank of Scotland are but a few of the thirty organisations awarded the Mark. We estimate that over 90 million transactional relationships are now protected because of the campaign’s efforts.

We need to do more

The Domestic Gas and Electricity (Tariff Cap) Bill offers an opportunity to enshrine consumer choice and the right to choose paper bills and statements, for energy customers, onto the Statute Book.

The Bill aims to cap energy tariffs for the most vulnerable in society and provide protection by autumn this year. The Business, Energy and Industrial Strategy Committee found that vulnerable consumers were the most likely to be on a standard variable tariff.

Originally proposed by the then Labour leader, Ed Miliband MP in 2013, the government argue that the bill will create incentives to increase efficiency, competition and maintain incentives to switch.

We are currently working with Peers in the House of Lords to amend the legislation. We will continue to engage with Peers to enshrine the right to choose, at no additional cost, paper bills and statements into law.

During the Bill’s Second Reading on Tuesday 22 May, Lord Whitty argued that there is a serious lack of understanding for consumers surrounding tariffs: “The method of communication is important; electronic and telephonic communications can disadvantage certain consumers. Fellow Lords may have received the information sent by the Keep Me Posted campaign."