UK gig workers face financial exclusion – study

Almost three-quarters (74%) of gig workers have been denied access to basic financial products such as a loan or a mortgage despite having a good credit score, new research by fintech startup Rollee has found.

Of the 1,000 gig workers surveyed, over half (60%) of the respondents have had to apply to three or more different lenders before receiving access to a credit card or a loan. Only 10% were successful when applying to their first lender.

According to research by University of Hertfordshire and BritainThinks, there are 4.4 million people working for gig economy platforms at least once a week in the UK today, contributing around £20 billion to the UK economy.

The findings in The Hidden Cost of Gig Worker Living report from Rollee highlight the struggle of gig workers across the UK in accessing financial products, impacting their lives in many ways. 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.

Almost a third (32%) said it has placed stress on them and their families. Others reported 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. However, to help with the cost-of-living throughout winter and the Christmas period, 25% indicated that they would still apply for a loan over the next couple of months.

The survey was commissioned by Rollee and conducted by Opinion Matters among a sample of 1,002 gig workers in the UK working in at least one self-employed job or platform job and who have applied for financial products since being a gig worker.

“This research reveals the level of financial exclusion gig workers are facing,” Ali Hamriti (pictured), chief executive and co-founder at Rollee, commented. “The struggle gig workers experience is not because they can’t afford a loan or mortgage, but because the current credit scoring systems of financial institutions are not set up to verify their multiple records of income and employment data.

“With financial institutions under increasing pressure, this results in workers being denied access to products they should be entitled to.”

Hamriti stressed that self-employed workers need a fair chance to be able to prove their solvency to financial institutions.

“As the number of independent workers continues to rise, it is vital that financial organisations find new ways to gain full visibility of self-employed workers’ employment data to assess them fairly, and ensure they are not excluded from financial products just because of their working status,” he said.