Banking for the Poor: Addressing the Needs of Financially Excluded Communities in Newcastle upon Tyne

Abstract

In the UK, many low-income communities have seen the withdrawal of `mainstream', high-street-based financial service infrastructure from their local areas since the mid to late 1980s, whilst more costly sub-prime lenders have flourished, often in their place. There has been a developing search for `alternative', welfare-oriented rather than profitdriven solutions to the problem of social and spatial segregation in financial service provision. This paper explores an initiative to create such an alternative, affordable and locally embedded form of personal financial service in a socially disadvantaged urban neighbourhood in the North East of England, Financial Inclusion Newcastle (FIN). This paper reflects on FIN's successes and failures, the potential limitations of such alternative area-based solutions and the lessons that can be learnt from these, through a focus on three key issues surrounding FIN's demise—the FIN model, its internal functioning and, perhaps most important of all, its relationship with the local community.