Financial inclusion has felt out of reach for too many people. According to the FCA, nearly a million people in the UK remain unbanked, and for those who do have access to financial services, that access isn’t always affordable or designed with their everyday needs in mind.

The UK is taking steps to address this, including the government’s latest financial inclusion strategy, which puts a welcome spotlight on digital inclusion. As more of life moves online – from paying bills to applying for credit – being digitally connected and being financially included are all packaged together.  But despite huge advances in digital banking, many consumers still find themselves priced out, left behind or navigating services that weren’t built with them in mind.

So, in a world of instant payments and AI-powered apps, why are so many people still excluded from products that should be available to everyone? With the right technology, these rigid, outdated models can be replaced with services that adapt to customers rather than shutting them out.

The Hidden Problem with Traditional Pricing Models

The issue comes down to legacy thinking. Traditional pricing models didn’t grow out of customer needs. They grew out of the way banks organised themselves internally. Products are designed by departments, and those departments are managed according to systems, processes, risk models, and profit lines. The result? Customers were viewed as isolated cases. Our sector missed the bigger picture. We do not see a whole person with a rich and complicated financial life.

So what’s the solution? It starts with innovation. Cross-product, cloud-based core systems, open banking and AI-driven decisioning tools allow lenders to build a more complete picture of someone’s financial life, including their saving habits, spending patterns and long-term behaviour.

For example, a seasonal worker whose income rises and falls throughout the year could be penalised if a lender focused on their income profile in the quieter months. A more advanced decisioning tool could make an assessment based on a seasonal worker’s whole annual pattern, providing a fairer and fuller picture of their finances.

Another solution is a product that automatically adjusts its rates depending on the customer’s day-to-day financial decisions. Here’s how it works: the rates would dynamically evolve in line with the product holder’s behaviour and their changes in liabilities. As a result, people with low credit history learn good financial behaviour and can improve their access to banking services.

The message is simple. Financial products can be more flexible. They can be truly aligned with the realities of people’s everyday lives. But we must invest in the right technology to make it happen.

How Can Smarter Pricing Reach the People Who’ve Been missed?

The fact is that most pricing decisions today still rely on a limited view of a customer’s data. We end up with a situation where lenders are making decisions whether or not to do business with a customer based on information held by a single institution or even a product line.

But anyone could tell you that such a narrow view isn’t enough to really understand what a person does with their money. We all manage money across several banks, financial apps and credit providers. Some of us save in one place, borrow in another and budget somewhere else entirely.

Smarter pricing technologies can bring these pieces together in a way that feels more rounded and fair. By using open banking data, behavioural insights, and, soon, digital identity frameworks, lenders can build a richer, fairer view of a customer.

There’s a longer term benefit, too. Digital identity and federated data models will allow people to securely share verified data across institutions. This gives customers more control over how they’re understood and ensures their financial story doesn’t reset every time they switch providers. It shifts the emphasis from exclusion to inclusion.

Why Moving Faster Helps People Feel More Included

Speed might not be the first thing that comes to mind when thinking about financial inclusion, but it matters more than you might expect. When products take months to design, approve and launch, lenders struggle to respond to changing customer needs – particularly for people in vulnerable situations.

Cloud technology changes everything. Lenders can bring new ideas to market more quickly, test them with real customers and adapt the product spec based on what’s working. We can move beyond static and one-size-fits-all offerings. We can push for cloud-native systems, for a market where products can grow with a customer, rewarding positive behaviour and opening doors to better terms over time.

The Technologies Shaping A More Inclusive Future

Of course, a range of new technologies is coming to the market. All could make financial services more inclusive for the average everyday customer. The UK government has recently acknowledged that financial education is very poor, and it is worse in the areas of society that are typically unbanked. Our industry, of course, has known this for some time. UK Finance members have built inroads, with over 145,000 educators across 25,000 schools.

But the work isn’t quite over. The simple fact is that financial products are hard for people to understand and scary.  AI can help people navigate decisions that once felt overwhelming or confusing. A person applying for credit for the first time, for instance, could use an AI assistant to compare options in plain language. By providing guidance that is both clear and tailored, AI helps people make informed choices without feeling intimidated.

Next comes digital identity and data portability, which tackle one of the most persistent obstacles to inclusion: lack of verifiable financial history. For people with irregular incomes or those new to the UK, these technologies can make a huge difference. Being able to carry verified financial information securely reduces the need to repeatedly prove financial standing and ensures continuity as customers move between services.

Finally, modern core banking architectures are laying the foundation for financial services that are flexible and human-centric. By moving away from predefined products, banks can design experiences that truly reflect a customer’s circumstances. This could mean flexible repayment plans that adapt to seasonal income or savings tools that respond to a customer’s habits over time.

Towards A More Accessible Financial System

Technology will play a central role in closing the financial inclusion gap in the UK. It can help create services that are easier to access and easier to understand. It’s about products that adapt to people’s lives rather than the other way around. And tools that give individuals the confidence and control they need to manage their money in a digital world.

The goal is a financial system that works for everyone and where no one is excluded because of outdated systems, incomplete data, or products that simply don’t reflect real life. And it’s in our reach. On the battlefront for financial inclusion, AI and technology can be a force for good. It’s up to our sector to embrace it without overlooking safety or structure.

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