What Our Personal Finances Tell Us About the Rise of Populism

On Friday, the financial services regulator (the Financial Conduct Authority) published its latest Financial Lives Survey, a nationally representative survey of nearly 18,000 people that serves as a state of the nation report on the UK’s personal finances.

It provides insights into our attitudes to managing money, accessing important financial products and services and perceptions of the financial services industry. It might also help us to understand what fuels populism and how to address it.

Trump won two General Elections by offering nationalist economic policies as the antidote to globalisation. Measures like imposing tariffs were designed to arrest the macroeconomic influences reshaping the former industrial heartlands of the US. They were also intended to capitalise on feelings of economic impotence in the face of external forces seemingly beyond political control.

In 2024, JD Vance broadened the boundaries of Trump’s insurgent campaign against “the establishment”. It was still a battle against the “deep state” and “the swamp” in Washington DC. But it was also about domestic big business.

JD Vance attacked tech companies for wielding unchecked corporate power that exercised influence beyond the control of US citizens. He also told the 2024 Republican National Convention, “We’re done, ladies and gentlemen, catering to Wall Street. We’ll commit to the working man”.

We know that wholesale financial services can have a profound effect on the political landscape. Cast your mind back to David Cameron waving his “Sorry, we’ve run out of money” letter around at every opportunity from 2010 onwards. We also know that trust – or lack thereof – in institutions is firmly linked to political disaffection.

But retail financial services – our current and saving accounts providers, insurers and credit lenders – have a significant ability to affect our sense of wellbeing and control. And as we’re all too aware, calls to take back control have real political currency.

The Financial Lives Survey found 13.1 million people, just under a quarter of the UK’s adult population, have low financial resilience. That can mean having little if any savings for unexpected expenses: 4.6 million people could only cover their living expenses for up to a week if they lost their main source of household income.

It can mean being heavily burdened by existing bills and/or credit commitments: 7.3 million people reported they were heavily burdened. Or it can means having missed bills in three or more of the last six months: 3 million people fit in this category.

For this population, getting access to things like insurance products to protect them from loss or credit products to deal with unexpected expenses can have a real impact on wellbeing.

Yet 14% of the population have no insurance or protection products and 13% offered a product in the last 2 years felt the price or terms and conditions were completely unreasonable.

22% of those who applied for a regulated credit product in the last two years were declined. 5.5 million people avoided applying for credit as they assumed they wouldn’t be eligible, wouldn’t be able to afford repayments, or would be rejected.

3.3 million people don’t bank online and 18% of those surveyed regularly use bank branches, although 9.5 million people find it difficult to get to a bank branch using their normal forms of transport.

The Financial Lives Survey also asks about trust in financial services. In 2024, only 39% of adults said they have confidence in the UK’s financial services industry. Only one in five adults expressed high trust in banks. 66% reported low trust in insurance companies and only 4% reported high levels of trust in fintech companies.

When asked about problems and complaints, the most common issues with regulated credit, day-to-day accounts and cash savings were poor customer service, and IT issues. One of the top issues for not complaining was “there is no point complaining, nothing would happen”.

Low levels of trust and an inability to access the right products and services to provide a sense of security and protection are a recipe for the disaffection that leads people to populist parties.

Labour’s Financial Services Plan promised to create a national financial inclusion strategy. Labour in Government has established the Financial Inclusion Committee, a group of industry and consumer groups that will work throughout 2025 to help shape the strategy.

Allowing more people to access the financial products and services they need to thrive isn’t just about stimulating demand to help grow the economy. If Labour is serious about meeting the challenge of populism, it needs to enhance the resilience of communities across the UK.

That means being ambitious about financial inclusion. It means asking what data should and shouldn’t be considered when pricing insurance or offering someone credit. It means thinking about access to face-to-face services so no-one feels left behind. It means making sure no-one feels their security and wellbeing is at the whim of forces beyond control.

If the next General Election is a contest between Labour and Reform UK, the next Financial Lives Survey will be as an important a KPI as any of Labour’s Missions for Government.

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