We are announcing the launch of our first survey report: “The hidden costs of gig workers living”. The report, which has been published in collaboration with a leading UK survey consultancy, reveals the concerns gig workers in the UK have and gives an overview of the financial exclusion they experience.
UK gig workers face financial exclusion when accessing loans and mortgages
The pandemic caused an undoubtable and significant shift in the way people work and earn a living. The number of people identifying as ‘independent workers’ increased by over a third as the importance of balance and flexibility at work gained priority, and people realised they could earn an income from home amidst changing circumstances. There are 4.4 million people working for gig economy platforms at least once a week in the UK today who contribute £20bn to the UK economy.
Over 7 in 10 UK gig workers have been denied access to basic financial products despite having a good credit score.
The report highlights that the struggle to access financial products is having an impact on the lives of gig workers across the UK. In fact, over half (52%) of gig workers surveyed have lost out on a new home due to being declined by a bank or building society, despite knowing they have affordability.
Gig workers surveyed also expressed the struggles they experienced when accessing financial services such as loans, or credit cards. Almost a third (32%) say it has placed stress on them and their families. Others report it has caused them financial hardship (29%), has prevented them from accessing housing (20%) and impacted the opportunities available to them in life (29%).
Looking ahead, 80% of gig workers surveyed feel concerned that the current-economic climate will impact their ability to be approved for a loan and to help with the cost of living throughout winter and the Christmas period, 25% will apply for a loan over the next couple of months.
Financial institutions can improve credit scoring models by requesting more data
Financial institutions currently operate manually to verify a worker’s income and employment data. In the case of verifying someone with one regular source of income, this process quickly recognises this record as a stable income. With gig workers earnings coming from different sources from one month to the next, financial institutions are tasked with tracking down different data records which are separated and dispersed from one platform or record to another. This makes it painfully time-consuming for financial institutions to verify an individual’s employment and income data making it difficult to make decisions such as granting mortgages. This slow and risky process means that independent workers face a long journey of delays, and sometimes barriers, when proving their solvency to financial institutions. Often, financial institutions do not have the time, which results in workers being denied access to financial services and business being lost in the process.
Rollee is on a mission to help financial institutions build fairer financial products with secure income data
The company is doing this by offering lenders, banks and other financial institutions an API to get secure, reliable and user-consented access to independent workers financial data. Additionally, by adopting Rollee’s API, financial institutions can improve their credit scoring models and access the untapped market of independent workers.
Click here to get your copy of the paper “The hidden cost of gig workers living”
