Q1: What needs to improve when it comes to financial literacy, creating better opportunities for underserved communities?
Perhaps the biggest barrier to improving financial literacy, particularly among underserved communities, is the inherent lack of trust in the mainstream financial system.
Far too many people from underserved communities have been excluded from mainstream banking opportunities and lack access to traditional credit building products. It’s difficult for people to trust a system that has historically left them behind.
Establishing and building trust with underserved communities is a critical step forward. That means developing relationships with the communities we are trying to serve, engaging local leaders, churches, businesses, and others within the community in meaningful conversations about their financial well-being.
We have to listen and show we understand the communities’ day-to-day struggles, as well as tailor financial literacy programs and materials to their specific needs.
Q2: How do we take action? Who should be leading the charge?
Improving financial literacy among underserved communities doesn’t fall on one organization or institution, it requires a collective effort from the financial services industry.
Each of us holds a different piece of the puzzle. Whether it’s developing budgeting techniques, building credit or investing, equipping people from underserved communities with financial knowledge better positions them to take control of their financial lives. Collaboration is paramount to success.
For instance, we work with organizations, such as the Jump$tart Coalition for Personal Financial Literacy, to provide teachers with tools and resources that they can take back to their classrooms to share with students.
In addition, organizations like the Society for Financial Education & Professional Development (SFEPD) engage students from Historically Black Colleges and Universities with financial knowledge so they can share with their communities.
Additionally, Experian’s Consumer Council, comprised of consumer advocacy organizations, academics, thought leaders and community representatives is a key part of that engagement.
Its members provide insight, knowledge and guidance to help Experian build better products and services to drive financial inclusion and improve financial health for all consumers.
Q3: What are the tangible things we can do right now to close gaps and make financial opportunities more accessible?
We can actively engage in dialogue with communities, particularly those that have been historically underserved. We must talk to leaders in the communities – and listen to them – to better understand the challenges that people are experiencing.
The more financial services organizations understand, the more they can adjust their financial literacy programming to resonate with specific audiences.
