This opinion article is submitted by Renuka Rawlins, Head of Policy and Public Affairs, Yaspa.
The publication of the UK Government’s Financial Inclusion Strategy in November 2025 marks a welcome and ambitious step forward. As HM Treasury, the UK government’s economic and finance ministry, rightly asserts, financial inclusion is not an optional extra but a bridge to opportunity and an engine for growth. This comprehensive strategy seeks to tackle systemic barriers and unlock opportunities for underserved groups across the UK, aiming to build a financial services system that genuinely works for everyone.
Access to banking is rightly framed as the foundation of financial inclusion, and the emphasis on using digital inclusion to help people manage their money and access financial products more effectively is a welcome approach.
Innovation will be central to achieving these goals. The strategy acknowledges that developments such as open banking have already delivered significant benefits, giving digitally capable individuals a real-time view of their finances and available products at the touch of a button. Looking ahead, open banking is set to play an instrumental role in supporting the strategy’s core aims, particularly in improving access to affordable credit and enhancing financial resilience.
A key focus highlighted by HM Treasury is the commitment to developing secondary legislation to further advance open banking. This legislation will enable the broader use of innovative products such as Variable Recurring Payments (VRPs). Powered by open banking, VRPs are designed to give users greater visibility, flexibility and control over their finances. For consumers, VRPs can allow repayment amounts to vary or enable extra payments that align better with income patterns and cash flow. This functionality is especially valuable for the many low-income earners who experience fluctuating pay, as VRPs have the potential to align credit use with income streams and in some cases remove the need to rely on credit simply to manage cash flow.
Yaspa views VRPs as a more flexible alternative to traditional payment methods such as direct debits and stored card payments. We are encouraged that the FCA, supported by the PSR, is assisting industry-led initiatives to establish a sustainable commercial model to drive progress on VRPs.
Credit where it’s due
Beyond flexibility in payments, open banking data offers a vital route to improved access to credit for those with thin or impaired credit files. Mainstream lenders are already trialling initiatives that allow customers who would otherwise be declined based solely on credit bureau data to link their open banking data. This additional insight provides lenders with a more comprehensive picture of a consumer’s financial situation, helping more people build eligibility for a wider range of products. This approach directly supports the strategy’s ambition to ensure people can access safe, affordable, and responsible credit.
Open banking also has significant potential in addressing problem debt. The debt advice sector has been slow to adopt new technologies, yet innovations like open banking can greatly improve the delivery and efficiency of debt advice – reducing bottlenecks, improving client journeys, and freeing up adviser time. Case studies show that technological enhancements driven by modernisation funds can save advisers considerable time per client and increase caseload capacity without compromising quality.
For open banking to realise its full potential in advancing financial inclusion, industry alignment will be crucial. While Yaspa’s Intelligent Payments already combine “Pay by Bank” transactions, AI-powered verification and real-time risk assessment, continued improvement is needed in speed, data transparency and fraud prevention. A robust infrastructure is essential to ensure payments are processed consistently within seconds, rivalling card payments. Moreover, integrating Account Information Services (AIS) and Payment Initiation Services (PIS) into a unified process will streamline the user journey, enabling businesses to carry out necessary checks before initiating payments.
Renuka Rawlins is Head of Policy and Public Affairs at Yaspa, a fast-growing fintech specialising in payments and identity. Rawlins’s previous roles included Government Affairs and Policy Manager at Revolut and Assistant Vice President of Government Relations at Barclays.
