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Improving financial capability through digital skills

Evidence type: Insight i


It is widely accepted that digital exclusion compounds the poverty premium, with those on lower incomes paying more for goods and services which are cheaper online. Digital tools often allow the user to find easier ways of saving and managing money, for example price comparison websites and online-only discounts. Those without access to, or the confidence to use, the internet cannot take advantage of these deals. The Lloyds Consumer Digital Index suggests that UK citizens could save up to £744 each year by being online. Almost half (47 per cent) of the offline population come from low-income households.

The study:

This 2019 report from the Good Things Foundation (sponsored by J.P. Morgan) summarises research that explores the challenges to supporting and improving digital skills among low-income households in financial difficulties, as well as initial recommendations on how to overcome these challenges. The aims of the research were to:

  • Understand the current UK digital skills landscape and the people and businesses that can benefit from digital skills support;
  • Map gaps in provision;
  • Identify the key features of best practice that can be tested and scaled.

The research team attempted to fulfil these aims by:

  • Conducting a thorough literature review of academic and policy evidence;
  • Analysing several quantitative datasets;
  • Conducting semi-structured interviews with academics, policymakers and other support organisations.

The research was conducted across four areas that had different priority groups for digital skills support:

  • Bournemouth, including digitally excluded Universal Credit claimants and social housing tenants struggling with their rent;
  • Edinburgh, including young people transitioning to independent living and people who face deprivation;
  • Glasgow, including migrants and BAME groups, as well as people with English as a second language;
  • Tower Hamlets, Hackney, and Newham, including women and working age mothers from the Bengali community, private renters and people in in-work poverty.

Key findings:

  • The report drew on previous research to show that some groups are at particular risk from both digital and economic exclusion. These include:
    • Young people, particularly those not in education, employment or training, and care leavers;
    • Immigrants, refugees and asylum seekers;
    • Those with health issues and disabled people;
    • Carers, including single parents;
    • Long-term unemployed;
    • Traveller communities;
    • Ex-offenders and those at risk of homelessness/the homeless.
  • Within the above groups, several sub-groups were identified as being particularly at risk, with deeper-rooted problems. These included young people from the LGBTQ community, low-income renters with issues regarding housing benefits, and people from BAME communities.
  • The report stated digital skills should be framed in relation to social inclusion and education.
  • A strong ‘ecosystem’ of support is essential, with individuals normally needing help and support from a range of services. The referrals and communication between these services is crucial.
  • An awareness of the requirement for digital skills and support often happens during a crisis. High quality support to resolve crises can establish trust between parties that can develop into an ongoing relationship with clients.
  • Standard, coordinated approaches to early assessment should mean engagement with one service leads to engagement with others that are relevant to the individual user. However, the studies reveal a disconnect between crisis and progression services.
  • Any financial capability support must embed digital skills within it, in particular around switching payment methods and understanding financial products.
  • Digital skills are not just important for addressing financial needs directly but can also remove barriers across many other aspects of everyday life.
  • The authors state a more holistic approach to digital capability is arguably where the real and lasting benefits of developing digital skills lie.
  • The report highlighted areas with the potential for ‘innovative exploration’ through projects, including:
    • Delivering cost-effective one-to-one or small group support;
    • Using the necessity of registering for Universal Credit as an opportunity to help people develop wider digital skills for other areas of their lives;
    • Developing financial education and support that takes into account the needs and make-up of the local population;
    • Co-designing approaches with local authorities;
    • Changing behaviour around online transactions through peer-supported learning;
    • Using brand loyalty – for example with banks or trusted community organisations – to engage adults to improve their literacy and numeracy as these are the first steps towards digital inclusion;
    • Finding the right ‘hooks’ to engage those who are traditionally hard to reach and may find talking about money difficult.

Points to consider:

Methodological strengths and limitations:

  • There are few details regarding the methodological process behind this report.
  • While these findings and suggestions may be applicable to numerous sub-groups in the UK population, they are not necessarily representative of all digitally excluded groups in the UK.


  • This report is relevant to all researchers with an interest in the issues surrounding digital exclusion and the use of technology to increase levels of financial capability.

Generalisability/ transferability:

  • The results and recommendations in this report are pertinent to interventions aiming to enhance digital skills, but it must be recognised that different groups have different needs and the recommendations are not necessarily generalisable to all.

Key info

Year of publication
Contact information

Dr Alice Mathers Good Things Foundation research@goodthingsfoundation.org