UK savings crisis brings spotlight on need for a banking revolution, with two thirds worried over future savingsBack to Media
6 February 2014
- ‘Saving Britain’ research highlights inability to save is leading to widespread financial worry
- Findings come as Ffrees Family Finance challenges the banking sector and launches first ever savings incentive current account
Research from new current account provider, Ffrees Family Finance, reveals that just under two thirds of people (64%) are unable to save money each month. In addition 70% worry about their ability to save, leading to widespread fears for their future financial security. As part of a new campaign launched today – Saving Britain – the research reveals the true picture of Britain’s savings crisis.
The Saving Britain campaign coincides with the launch of a revolutionary new type of current account to help people save. The Ffrees current account has been created to help families manage their money through ‘JamJar’ savings tools, without the threat of penalty fees and other high costs.
‘JamJar’ accounts allow people to ring-fence money to pay bills. Account holders also automatically build up savings as they spend, which are set aside in a separate ‘JamJar’. The Ffrees Family Account has no monthly or initial set up fees.
Commissioned in conjunction with YouGov, Ffrees polled 1,000 UK adults with gross personal incomes below £24,000. Key findings included:
- 84% of respondents are concerned about the increase in utility bills and their ability to pay them;
- 40% are worried about retirement;
- Over a third (37%) find it hard to manage their bills and outgoings each month.
Alex Letts, CEO, Ffrees Family Finance, commented:
“We have reinvented the current account to provide a lower cost service that helps people save up. We have started with what modern families actually need instead of being constrained by what ancient systems and ancient history dictate.
“Simply adding more high street banking competition is actually irrelevant. That is just ‘same old-same old’. The banking model needs reinvention and a new attitude. The focus needs to switch from how to increase fees and charges, to helping people save up and manage their bills.
“This is just the start, not the end point. We believe that our modern cost-base and structure will allow us to evolve the model so that what you spend not only helps you save but, in time actually pays for all the current account costs.”
In addition to the research, Ffrees has collaborated with some of the industry’s most influential and knowledgeable stakeholders to drill down to the financial issues amongst lower income Britain. The group has developed a charter based on the discussions, outlining key actions and tangible initiatives that they believe will help tackle Britain’s savings crisis.
Key recommendations include:
- Setting savings targets for families that are achievable for all, not just for wealthy families
- Setting numeric goals for “rainy day saving” such as £1 a day, like the five a day food campaign
- Creating a positive narrative in the media, not least through social media, reinforcing the benefits of a saving culture
- Staff-saving-schemes should become part of basic company packages
- Encouragement of modern competitors with different business models to fill the banking gap
- Opening a savings account must be made as easy as taking out a Payday loan
Further findings of the research included:
- 60% of respondents have been in debt for over two years;
- 89% are concerned about banking charges when taking out a loan or overdraft;
- 33% that do have savings are not happy with their account.
FFREES CUSTOMER CASE STUDIES AVAILABLE ON REQUEST