Charities: Banks must stop exclusion

Charities and community groups today called on banks to open up to the millions of people who they say are excluded from credit.

The Better Banking Campaign said between five million and seven million people could not access mainstream credit, such as overdrafts, loans and credit cards, while nearly 1.8 million people do not have a basic bank account.

It said these people were being forced to borrow money from payday lenders and home credit companies, which often charge interest equivalent to 2,500 per cent a year.

The campaign is calling for financial institutions to be given incentives and obligations to encourage them to offer greater services.

It also wants caps to be imposed on unfair interest rates and greater transparency on which areas have the biggest problems with financial exclusion.

A survey of 1,000 people carried out for the group found that 70 per cent think having access to mainstream financial services should be a basic right, while 55 per cent think being able to access them is essential.

Steve Wyler, spokesman for the campaign, said: "Considering how much public money has propped up the financial institutions, it is deplorable that 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."