Just three in 10 disabled people are satisfied with the quality of the financial advice or information they receive, according to a report from the University of Bristol’s Personal Finance Research Centre and the Research Institute for Disabled Consumers supported by Abrdn Financial Fairness Trust.
The report found that while most of the 815 respondents surveyed said they had accessed advice or information on financial matters, just 29% were satisfied with the quality of the advice or information that was available.
Along with physical barriers, disabled people reported a range of other issues with accessing financial services.
Two-in-10 survey respondents (18%) feared switching products due to the risk of scams or making a mistake, which could leave them stuck with poor value or inappropriate products.
And a similar number (16%) worried about disclosing their impairment in case financial services firms withdrew insurance cover or charged them more.
Researchers also found it was not uncommon for disabled people to say they had been turned down for credit or insurance products or to be offered products on terms they felt to be expensive and/or unfair.
Consumer Duty
The Financial Conduct Authority’s (FCA) new Consumer Duty is meant to ensure that financial services firms treat all customers fairly, for example by using inclusive design in product development. But the report raised concerns that some firms may simply stop serving some groups of customers altogether rather than risk not complying with the regulations.
Consequently, it concluded that it is “crucial therefore that the regulator closely monitors what firms do and the outcomes for consumers”.
Aligned to this, the report also highlighted “calls for government to give the FCA a new ‘must have regard to’ requirement for considering financial inclusion across its work, to try and safeguard people’s access to financial services”.
But the report also said that as the population is increasingly expected to access and use online and digital services, “it is also important that people are equipped to do this safely”.
The report pointed to recommendations made by a House of Lords inquiry into digital exclusion to include government investment in basic skills and community based digital inclusion hubs.
As full digital inclusion is unrealistic, the inquiry concluded that “Accessible services and offline alternatives are essential to ensuring people are not left behind in an increasingly connected world.”
The inquiry also made the point that digitally excluded groups, including disabled people, are likely to be poorly represented in some datasets that inform algorithmic decision-making.
As a result, the report found they face a growing risk of marginalisation given the increasing use of predictive machine learning tools in public services, which this is equally true of financial and other services. Wherever they are used, these tools should be kept under review.
And as the UK’s Financial Wellbeing Strategy 2020-2030 has a cross-cutting theme of mental health but no focus on disabled people or other impairments, the report concluded, “at the very least, the cross-cutting theme should be changed to ‘mental health and disability’”.
Insufficient support
More widely the report found there is insufficient support available for people with disabilities and called for greater focus on the different needs that disabled people have.
One-in-three disabled people are struggling to make ends meet (in comparison with one-in-10 non-disabled adults).
The findings showed some disabled people are much more likely to face financial hardship than others; this can be due to the type and nature of a person’s impairment, as well as factors such as age.
The researchers investigated financial wellbeing among disabled people with a new focus on demographics and impairment type. They found that, while many disabled people in the UK are struggling financially, age, income-level and types of impairment are key factors in influencing disabled people’s living standards and what they can afford.
The survey found that age and income contribute to differences in disabled people’s financial wellbeing:
- Working age disabled adults reported significantly worse financial wellbeing than those of pensionable age on financial wellbeing measures.
- Disabled people on the lowest incomes, those in receipt of benefits and those not undertaking any paid work, also had higher levels of financial difficulty.
The research also showed that disabled people with specific types of impairments, have significantly higher odds of experiencing financial problems than disabled people overall. These include:
- Physical mobility impairments
- Learning difficulties
- Mental health conditions
- Multiple health conditions
- Conditions that affect one’s appearance
- Disabilities acquired suddenly
- Chronic fatigue
- Non-visible conditions (including mental health and chronic fatigue)
- Memory-related conditions.
Nearly two-in-five (37%) disabled people who acquired their disability suddenly were in a ‘constant struggle’ to pay their bills and 36% were unable to afford occasional treats for themselves or their family. This compares with 24% and 20% respectively for those who had been disabled since birth.
Lack of money can have serious negative impacts on disabled people’s mental and physical health, when they are already living with often complex, multiple health conditions.
As a direct result of money worries, in the last six months:
- Three-in-10 (27%) disabled adults are in serious financial difficulty, compared to one-in 10 (11%) of non-disabled adults.
- Nearly one-in-three (29%) disabled people said that ‘it is a constant struggle’ to meet their bills and credit commitments.
- 52% had been unable to keep their home warm and comfortable.
- Nearly a third (32%) had avoided going to the dentist or receiving dental treatment as a result of the cost, while a quarter (25%) had cut down or stopped receiving medical services that they had been paying privately for – such as counselling or physiotherapy.
While cutting back may alleviate financial costs, the report found this can come with a hefty price tag in terms of the impact on disabled people’s health.
When asked how they felt their financial situation was affecting their health, 45% of disabled people said it was making their mental health worse, while 40% felt this was true of their physical health. Among those in receipt of benefits, this rises to 49% for mental health and 43% for physical health. For those on the lowest incomes, these rise yet further to 57% and 50% respectively.
To improve disabled people’s living standards and ensure they have equal rights to full inclusion and participation in UK society, researchers argue that four things are urgently needed:
- Better access to employment for those who can work: Three-in-10 (29%) working age disabled people felt they had been discriminated against by employers or potential employers because of their impairment. A quarter (26%) said that employers had failed to make reasonable adjustments for them.
- A benefits system that provides a proper safety net: Half (47%) of disabled people receiving Universal Credit were struggling to pay for food and other essentials, as were a third (35%) of those in receipt of Personal Independence Payment. Most (71%) disabled people who received benefits agreed that they had been made to feel guilty about applying for benefits, while 82% felt that uncertainty about benefits makes it harder for them to plan their future finances.
- Targeted support to reduce the costs of disability: Three-quarters of disabled people (75%) agreed that they have “particularly high costs” due to their impairment, such as high energy and water costs. These costs may amount to more than £1,100 per month, according to research from Scope.
- Access to essential services and advice: Half of disabled people (53%) reported difficulties getting to a bank branch; and four-in-10 (37%) said they had problems getting to or using a cash machine.
Urgent need
Mubin Haq, CEO of Abrdn Financial Fairness Trust, said: “There is an urgent need for better financial support for people with disabilities.
“Nearly half of disabled people believe their financial situation is making their physical and mental health worse, which makes it even harder for disabled people to access work opportunities.
“It is essential we address this challenge if we are going to address the severe labour shortages we have in the UK, and improve living standards and the wellbeing of disabled people.
“This could be a win-win situation but at present government policy is heading in the wrong direction.”