The United Kingdom has one of the largest, most sophisticated and competitive financial services sectors in the world. It has responded quickly to the demands of a rapidly changing economy - new technologies, higher living standards and changes to the ways people live and work - providing a wide range of financial products to meet evolving needs.

Yet there is growing evidence that the market is not able to meet everyone's needs. A small but significant minority are unable to access even the simplest financial services, meaning that they pay more to manage their money, find it harder to plan for the future and cope with financial pressures, and are more vulnerable to financial distress and over-indebtedness.

The Government believes that everyone should be able to: manage their money effectively and securely; plan for the future with a reasonable degree of security; and have the information, capability and confidence they need to prevent avoidable financial difficulty, and know where to turn if they do find themselves in financial distress.

The Government set out its strategy to tackle financial exclusion in Financial Inclusion - the way forward, published on 28 March 2007. The report makes a number of key announcements:

there will be a new Financial Inclusion Fund for the next spending period;
the current level of intensity of action to promote financial inclusion will be maintained, with the exact amount of the new Fund to be determined after the Comprehensive Spending Review (CSR);
a cross-Government working group composed of ministers with an interest in financial inclusion will be established to develop policy next steps, and publish a detailed action plan after the CSR; and
the Financial Inclusion Taskforce will be extended so that it continues throughout the next spending period.
Promoting Financial Inclusion
The Government's [first] financial inclusion strategy, Promoting financial inclusion, was published in December 2004. This:

announced the creation of a dedicated Financial Inclusion Fund of £120 million for the 2004-07 spending period;
prioritised access to banking, affordable credit and free face-to-face money advice; and
established an independent Financial Inclusion Taskforce to advise the Government and monitor progress.
Since December 2004, the Government has made good progress in implementing this strategy. The Financial Inclusion Fund is supporting the following initiatives to tackle financial exclusion:

the DTI is administering £47.5 million to recruit and train over 500 new money advisers - these new advisers have so far provided crucial assistance to over 26,000 clients struggling with debt;
the DWP are running a £36 million Growth Fund to allow credit unions and community development finance institutions to make affordable loans to financially excluded people without access to mainstream credit - over 100 of these lenders are now receiving funding, and over 21,000 loans have been made so far; and
the fund is also supporting a national rollout of projects to tackle illegal lending by loan sharks and provide support for victims.