The Fairbanking Foundation is a not-for-profit, research-based charity established in 2008 to encourage and assist providers of banking products to improve the financial well-being of their customers by enabling these customers to manage their money better. The Foundation does this through a combination of thorough consumer research to better understand what drives financial well-being, assessment of existing core banking products against this understanding, and the operation of the Fairbanking Mark certification scheme, now accredited by UKAS.
The Fairbanking Mark
The launch of the Fairbanking Mark is an important step in helping customers to identify products that have been rigorously tested for the financial well-being they can deliver. Crucially, it also provides a powerful incentive for financial institutions of all sizes to compete through continual improvement of their products in ways that will truly benefit their customers.
The Fairbanking Foundation has awarded its first Mark certifications to credit unions. Central Liverpool Credit Union, London Capital Credit Union and the Enterprise Credit Union have all received 5 stars for their personal loan products.
In order to receive this award, the credit unions had to demonstrate that their personal loan customers have experienced a tangible positive impact on their financial wellbeing from using the product features. These features include budgeting support, encouragement to prepay, providing support at the earliest opportunity and developing a savings habit. In addition to reviewing the financial well-being characteristics and features of the product, the process of assessment involves independent research carried out with a representative number of customers holding that product. This research is carried out to test the extent to which the theoretical benefits to financial well-being are delivered in practice.
Central Liverpool Credit Union's Share-based loan and Helping Hands loan products were both awarded five stars. Credit union CEO Eileen Halligan said:“Financial well-being is central to all of the products we offer, and this is reflected in the fact Fairbanking’s research with our personal loans customers reveals that many have one or more other products with us. We strive to be as transparent as possible and offer tools and real people for customers to talk to if they have any financial concerns around our products and are delighted our Share-based loan and Helping Hands loan have been awarded five stars. We also strive to be as competitive as possible, so it was pleasing to see that of the personal loan customers interviewed by the Foundation, 48% said that the loan rate we offered them was lower than they had expected, and only 3% said it was higher.”