A coalition of charities and community groups today called on banks to increase access to financial services for the millions who are currently excluded.
The Better Banking Campaign says between five million and seven million people cannot access mainstream credit, such as overdrafts, loans and credit cards, while nearly 1.8 million people do not have even a basic bank account (see the Best Bank Accounts, Cheap Loans and Balance Transfer Credit Card guides).
As a result, it said these people were being forced to borrow money from payday lenders and home credit companies, which often charged interest equivalent to 2,500% a year
The campaign is calling for financial institutions to be given incentives and obligations to encourage them to offer services to people who are currently excluded.
It also wants caps imposed on unfair interest rates and greater transparency on which areas have the biggest problems with financial exclusion.
Research carried out for the group found 70% of people think having access to mainstream financial services should be a basic right, while 55% think being able to access them is essential for everyday living.
Steve Wyler, spokesman for the campaign, says: "Considering how much public money has propped up the financial institutions, it is deplorable they aren't currently supporting the people and businesses most in need in our communities.
"Most people believe access to bank accounts and affordable credit are basic rights, so we want to see this as a priority for all the political parties."
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