The BBA is now integrated into UK Finance. Please go to www.ukfinance.org.uk for new content and updates from UK Finance.
Material published by BBA prior to 1st July 2017 is still available on this website.
From 1 July 2017, the finance and banking industry operating in the UK will be represented by a new trade association, UK Finance. It will represent around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation will take on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.x
While getting my latest fix of celebrity gossip, I found myself musing about one of Britain’s last taboos. According to her latest interview, Kate Winslet doesn’t like to talk about money. She finds the topic is a little ‘vulgar’. I disagree. We do need to talk about money. We should take a leaf out of America’s way, break a British habit of a lifetime and start to gas about the green stuff. We should be chatting with our friends and family not just about how much money we earn but about how much we owe, what we are saving and how we are planning for the future.
One of the most important and practical skills in life is the ability to competently manage our money. Too many adults in the UK haven’t received enough financial education to help them make the right decisions when it comes to money matters. According to a report by the charity National Numeracy, only half of the UK population has numeracy skills equivalent to those expected of children at primary school. Sixteen per cent of people are unable to identify the balance on a bank statement.
One of the first conclusions that is often drawn from these findings is that financial education needs to be part of a long-term strategy to improve financial skills. This is definitely important and we need to ensure that all British adults have the right skills to manage their money from school right through to retirement. But there is also a more fundamental cultural shift that needs to happen.
Research for the Money Advice Service – set up by government to provide impartial financial advice – suggests that by the age of four or five, children understand that they need to pay for goods. By the time they leave primary school, most children have already developed basic ‘financial’ skills, such as counting, an understanding of value, exchange of money and earning an income. And, the BBA’s own research found that children are accessing financial products at earlier than ever: 64 percent of children get their first bank or building society account before they start secondary school. However, just 23 percent of 8-15 year olds have heard of a current account and understand how it works. Only 13 percent who are aware of overdrafts claim they understand them. It is perhaps unsurprising, therefore, that how to budget and how loans work ranked first and third respectively in a study by Able Skills outlining the the top 30 things British people wish they’d learned in schools.
We need to stop being so British and start talking about how we make, save and spend our cash. An honest and open conversation about the balance on your latest statement or the rate of interest on your mortgage can only help support a more clued up society where we are empowered to learn more about what we earn.