In a recent report published by M&C Saatchi, titled The Black Pound, a staggering 65% of people living in the UK that are black, Asian or minority ethnic (BAME) felt they needed more access to financial knowledge to be able to access greater wealth. Worse still, 70% of the same cohort felt undervalued as consumers in the UK.
But this is really only the tip of the iceberg when addressing the inequalities that exist within financial services sector.
The UK’s banks are holding back the BAME population from breaking through what is perceived to be the last frontier of racial economic equality, despite as many as 50% of BAME consumers owning their own home. At a time when many of the UK’s high street banks have been bailed out by the UK taxpayer, they should have the same responsibility to assist British people, no matter their colour, race, religion etc. in achieving their potential and creating wreath through entrepreneurialism and business success.
The sad truth is that of the 35% of people from black origin that have said they want to start a business, only 6% of them actually do, and much of this is associated with the challenges they face accessing the loans they need.
Past evidence has shown that firms owned by individuals of black African origin have been four times more likely than so-called 'white firms' to be denied access to loans outright. Worse still, Bangladeshi, Pakistani, black Caribbean and black African-owned businesses have been subjected to higher interest rates than white or Indian-owned businesses.
Forces at play
There are complex and highly sensitive issues and forces at play. Poorer education among ethnic minority groups, lack of the right guidance, lack of their own capital to invest and access to information all contribute. Individual biases of those working within the financial services sector are also likely to play a part, albeit a small one, along with the lack of real insight into the experiences of these key target audiences upon which to take action.
The BAME population, as with many of what were once described as niche or diverse groups in society now form a powerful and increasingly growing section of the modern British mainstream society. To ignore them is akin to our country's financial suicide.
To achieve real equality and inclusion, banks and other financial services providers must first dive deep into the lives of this target audience to see why the issues and prejudices exist. This cannot be achieved through surveys and statistical reports alone, business leaders need to walk in their shoes and bring them into their business to see first-hand what the opportunity is and how it can benefit the entire population.