Financial Inclusion: Young People

Edward Morello Excerpts

Tuesday 30th June 2026 Westminster Hall

[Edward Morello (West Dorset) (LD)]

It is a honour to serve under your chairship, Sir John. My first job was on the deli counter of my local supermarket. I congratulate the hon. Member for Hertford and Stortford (Josh Dean) on securing this important debate.

In the middle of a cost of living crisis, whether a young person knows how to manage their money, can afford to stay in education, can access affordable financial services and advice they can trust, can avoid problem debt and can build a secure future has never mattered more. Young people are facing challenges that previous generations did not. Money has changed. For previous generations, it was coins in a pocket or cash in a wallet. Today it is numbers on a screen—online banking, apps, digital wallets, “buy now, pay later” schemes, cryptocurrency and social media influencers offering financial advice that often benefits themselves rather than the young people following them.

We assume that because young people are comfortable with technology they are financially literate, but those are not the same things. The Milburn review laid out the importance of financial inclusion for young people. Between January and March of this year, 1.01 million people between the ages of 16 and 24 were not in education, employment or training. The number of young adults regularly relying on borrowing has increased by 45% in just one year. Many are using unsecured loans and buy now, pay later products to cover everyday essentials, while one in five were employed on zero-hours contracts, making it almost impossible to budget or save. This is not just about people on the lowest incomes; it is increasingly affecting younger people who are working hard but cannot get ahead.

The challenges are even greater in rural constituencies such as West Dorset. Financial inclusion depends on being able to access financial services, yet facilities that make this possible—bank branches, cash machines and post offices—are disappearing fastest from rural communities because they are considered commercially unviable. Meanwhile, our communities are expected to embrace digital banking despite persistent mobile phone and broadband blackspots in villages such as Drimpton, Burton Bradstock and Stoke Abbott. Across the country, 1 million people have cancelled internet packages because of the cost of living crisis. Digital banking cannot be the answer if people cannot get online.

True financial inclusion should be about giving people the confidence and knowledge to make informed decisions throughout their lives, yet less than half of children receive meaningful financial education either at home or in school. Nearly one quarter of young adults have low financial capability. Most children say that they would ask their parents’ financial advice, yet only about half of parents feel confident having those conversations. Financial education should become a core life skill, taught from primary school onwards.

Every young person should leave school with an understanding of budgeting, saving, borrowing, mortgages, pensions, taxation, credit scores, fraud and the long-term consequences of debt. Those are skills that will benefit them throughout their lives. Financial education should not stop when the school day ends. Family hubs, community hubs and banking hubs could and should become centres of financial guidance, not just financial services. Parents and carers should receive greater support because they remain the single biggest influence on their children’s financial behaviour.

We must also recognise the growing risk facing financially excluded households. An estimated 2 million people are now borrowing from illegal moneylenders—an increase of about half a million since 2022. More people are turning to payday loans simply to pay their rent or mortgage. That is not sustainable and we must do better. We must ensure that everyone has access to appropriate and affordable financial services, regardless of where they live, and can access affordable credit and independent debt advice before they reach crisis point.

For constituencies such as West Dorset, financial inclusion is also about opportunity. It determines whether a young person can take up an apprenticeship, manage their first wage, avoid exploitative lending and build financial independence. When we fail to equip young people with the skills and services they need to manage their money, we do not simply leave them financially excluded; we rob them of opportunity itself.