personal debt, & ongoing risks...

lemonjelly

vivatifosi wrote: »

I can see two interesting changes taking shape in terms of access to finance and wondered what the opinion of others is.

The first point I've noticed is increased knowledge among the poor and therefore use of the Credit Union movement. My local CU seems to be doing a roaring trade at the moment.

The second is the mooted changes last week in the structure of the Post Office which will allow people with bank accounts to undertake transactions at their local post office.

I think both of these are positive steps in the right direction to give access to finance to those who will find it difficult. However my concern is whether access to basic financial services like this could allow the banks to focus more on their "cash cow" customers and spend more time cutting off marginal users.

A growth of Credit Unions could be one of the most beneficial things to happen Viva. Credit Unions can be a lifesaver for many people, & can operate so well within a community. Ideaas such as Christmas savers, & their car loans can be of so much benefit to some people who are so excluded from financial services.

Credit unions offer a great service to a local community, and help introduce a lot of people to how financial products work. They also teach people about the benefits of saving. They also can help people learn a lot about interest rates and the like...

The Post Office initiative could also increase the availability of financial products to many people who are currently excluded.

I understand your point about the concern for banks using this as a means to restrict access to services for those that the banks deem "less profitable", however in many ways this has happened for some time. We recall the time when Halifax got caught by leaving details of a training session which commented on the types of customers they don't want (childrens accounts, charities etc...), & these details made it into the papers.

My hope would actually be that by using the PO & CU's, more people will become a lot more empowered & have more knowledge than currently about financial services, so they can be a little more savvy when shopping around for products & services.

Thrugelmir

lemonjelly wrote: »

I am wondering how people will adjust to restricted credit. Taken 1 step further, we were supposed to spend our way out of the slump & have a consumer lead recovery. Given disposable incomes are being stretched, how is this consumer lead recovery going to happen?

People will adjust. Fact. If its not available to people then habits will change, people adapt. Though probably be lots of news stories about tight fisted banks along the way.

We need an industry based recovery. Which creates real jobs and wealth. Generates sustainable tax revenues . A consumer lead recovery will just mean the importation of yet more cheap Far Eastern / Eastern European produced goods. That will do little for the overall economy.

One of the biggest boosts to the UK economy. Could be the fact that people are travelling abroad both less and less frequently. Meaning that more disposable income is spent internally within the UK.

I agree with your concerns in general. As the lack of wage inflation. Is going to make those burdened with debt carry it for a very long time. So much so that there is a whole generation that will spend their lives bordering on just getting by .

Thrugelmir

lemonjelly wrote: »

A growth of Credit Unions could be one of the most beneficial things to happen Viva. Credit Unions can be a lifesaver for many people, & can operate so well within a community. Ideaas such as Christmas savers, & their car loans can be of so much benefit to some people who are so excluded from financial services.

Birmingham City Council made a fanfare in 2008 of opening a co-operative bank for the benefit of the local community.

However in August 2009.

The much heralded revival of Birmingham Municipal Bank has been quietly shelved after city leaders found it would be legally difficult, too expensive and fail to help the city through the recession.
Now only a much watered down version of the council owned bank will see a handful of struggling businesses offered loans to help them through the sticky patch and some support for the Credit Union movement.

Not as easy as people imagine.

lemonjelly

Birmingham has 3 credit unions. To be honest, anything BCC do is likely to fail. They are a shockingly poor council, in every sense.

Too many legacy builders...