To financially include young people from low-income communities—so that they have somewhere safe to keep their money, have the help they need in managing their money, and have the information they need to make good decisions—it is important to understand how they live and how they make a living. We ask how we can tailor the offerings of financial service providers to meet young people’s needs, which starts with young people informing banks about which products and services they want to see.
The young people in our survey use financial services and products on offer. Around half have bank accounts, 44% used mobile money, 43% used electronic payments, and 30% received transaction history and payment statistics—but 62% of the young people in the survey also say that they prefer not to use most financial services and products.
The survey responses and stakeholder interviews point to three main issues: i. Young people need to be put at the heart of designing products and services that are fit for them; ii. Young people require financial information and infrastructures to make informed financial decisions; iii. A relationship of trust needs to be built as part of the provision of financial services and products. Good financial solutions would enable a trusting and accessible relationship between customer and bank, paired with products and services tailored to specific market segments of young people, as well as information sharing to support young people to make informed decisions which minimise personal financial risk and help them along the path to achieving their goals.
SUMMARY INSIGHTS AND RECOMMENDATIONS
1. Financial products and services are not fit for purpose for young people in low-income communities. They cost too much, are too far away, present real and perceived risk, and do not meet the more basic need of young people to keep their money safe and manage it wisely.
2. Young people do not have a strong relationship with formal financial service providers.
3. Young people lack the financial information that they need to be able to make informed financial decisions.
1. Young people should be put at the heart of designing financial products and services fit for them.
2. A relationship needs to be built between formal financial service providers and young people—particularly in low-income and low-trust settings.
3. Financial service providers can give young people access to the information they need to be able to make informed financial decisions, beyond what traditional financial education already provides.
