With national lockdown commencing, financial services experts foresee a continued step-change in support offered to customers grappling with mental health concerns as banks continue to ramp up measures to help consumers manage pressure on finances prompted by the pandemic.
Research carried out by multinational law firm Pinsent Masons, and published today in their report “Creating a culture of support in financial services”, found that tools including text alerts and spending blocks could help form the ‘backbone of consumer money management’ for those vulnerable to mental health conditions. 74% of survey respondents said they were happy for their bank to implement such aids during periods of abnormal account activity.
Despite this, just 45% of respondents currently use money management tools available from their banks. Pinsent Masons says this signals a potential disconnect between the support on offer from banks and the awareness of the support available at a customer level, which must be addressed as the UK faces further economic uncertainty triggered by the pandemic.
Furthermore, 72% of respondents were unaware of the additional support made available by banks as a result of the pandemic, despite wide measures implemented across the whole financial services sector.
Jonathan Cavill, Senior Associate at the law firm Pinsent Masons – specialising in Contentious Financial Services Regulation and Redress said:
“Given that the Covid-19 pandemic has been described as a mental health emergency, and as we face the potential of a second UK wide lockdown, it is now as important as ever for financial services providers to continue to work with their customers and the wider industry to break down the stigma surrounding mental health. Many firms will be alive to these issues off the back of the FCA’s continued work regarding vulnerable customers, and many firms have been making fantastic strides in this space in recent years. However, the findings of our survey show that some firms may need to look to further develop suitable measures, such as technological solutions and appropriate policies, to assist those customers who need it; hopefully helping to reduce health issues connected to financial concerns.
“The industry has access to useful tools and methods which can help vulnerable customers, including this with cognitive challenges. But, our survey results suggest that they aren’t being as widely used as envisaged. It’s particularly interesting that nearly three-quarters of customers surveyed would be happy for their financial providers to put in place controls if they notice abnormal account activity. Proactive efforts such as these could assist customers with their money management and “stepping in” to improve customer outcomes.”
On 1 October 2020, the Centre for Mental Health charity warned that up to 10 million people in England could need help with their mental health because of COVID-19, of which two thirds will be people who need help for existing mental health issues made worse because of COVID-19 with the other third having developed mental health issues during the pandemic. In addition, people with mental health conditions are 3.5 times more likely to be in problem debt and the Financial Conduct Authority’s (FCA) latest data shows that more than 24 million people now display one or more potential characteristic of vulnerability – which includes physical and mental health issues, recent life events such as bereavement, capability and financial resilience.
“The survey figures are helpful in that they highlight that the topic of mental health in financial services still needs to be high up on the agenda. Whilst the pandemic has broadened the conversation, the industry now needs to take advantage of the momentum made, the good work done in this space to date and to continue to embed improvements across the financial services sector so that customers feel comfortable speaking with their providers about their mental health.