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Opportunities for digital banking: Lived experiences of financially vulnerable customers in the UK
Journal of Digital Banking,
9
(4),
340-352
(2025)
Abstract
The financial sector is currently implementing the Financial Conduct Authority (FCA) customer duty (CD) legislation, focusing on financially vulnerable customers. Recent statistics highlight the urgency around this context: 14 million people report having less than £100 in savings, and 11.5 million people are terminating vital insurance policies because of affordability concerns during the ongoing cost-of-living crisis. The focus of CD has shown a lack of insights from the perspective of financially excluded and vulnerable UK customers. The financial sector can create value for these customers by reflecting on assumptions of vulnerability when training machine learning algorithms in determining access to financial products and services based on the ability to pay and personal circumstances. We examine industry and customer vulnerability assumptions, including discussions of levels of trust in, and scepticism of, digital banking (DB). Likewise, we provide evidence-based suggestions to facilitate financial providers to scrutinise their responsible lending practices. In so doing, DB lenders could address the tenets of CD and environmental, social and governance directives to inform future product and service design to drive responsible, inclusive, fair and transparent DB across society.
Keywords: FinTech; vulnerable customers; financial exclusion; corporate digital responsibility (CDR); environmental; social and governance (ESG); customer duty (CD)
The full article is available to subscribers to the journal.
Author's Biography
Karen Elliott is Chair/Full Professor of Practice in Finance & FinTech at the University of Birmingham Business School and Co-Director of the FinTech MSc Programme. She has been named as ‘Standout #35 Women in FinTech Powerlist by Innovate Finance’ for Policy and Governance 2019/2020/2021 and judge in 2023. In addition, she is an advisory board member to Incuto, championing access to fair and affordable finance, and an impact council member for We are Group, addressing the digital divide. Karen co-leads Agency, UKFin Network+ and INFINITY projects (£12m EPSRC/UKRI/Research England) to optimise trustworthy, sustainable, responsible and ethical AI. A member of the Prime Minister’s Champions Group for Dementia, Corporate Digital Responsibility, Radix, IEEE Global Initiative Planet Positive, The Payments Association and APPG for Fair Banking, Karen seeks a balance between academia and practice towards an equitable digital society.
Jehana Copilah-Ali Dr Jehana Copilah-Ali has a PhD in business and management from Newcastle University Business School, UK. She is a former research associate (RA) in finance at the Birmingham Business School (University of Birmingham) as part of AGENCY (EPSRC, £3.5m), analysing complex online harms from digital technologies using corporate digital responsibility (CDR) models, responding to policy calls and curating guidance materials and tools for industry. Her prior experience includes RA of systems design for financial services on the Trust Engineering for the Financial Industry project (EPSRC, £1.2m). Jehana formed a multidisciplinary team, participating in the FCA TechSprint (2024) on financial inclusion. Her areas of expertise are financial inclusion and CDR.
Magdalene Ng Dr Magdalene Ng is a lecturer in psychology at the University of Westminster, UK, specialising in the intersection of technology and crime. Her research focuses on understanding how advancements in digital technology impact criminal behaviour and law enforcement practices. Magdalene also has previous experience as an RA on the FinTrust project. Through her work, she contributes to developing innovative strategies for addressing technology-driven crime in today’s rapidly evolving digital landscape.
