Session: Grand Challenge for Social Work: Understanding Financial Exclusion and Inclusion (Society for Social Work and Research 20th Annual Conference - Grand Challenges for Social Work: Setting a Research Agenda for the Future)

Financial inclusion, the ability to access appropriate financial products and services that help to build wealth, is a critical aspect of practice that promotes family financial stability. Financial inclusion efforts promote engagement with the formal financial system (i.e., banks and credit unions) through relevant products and services. Engagement with the formal financial system is negatively associated with income level, thus low-income and financially vulnerable populations have less engagement than other populations. Efforts to promote financial inclusion for financially vulnerable populations are often combined with financial education to promote wealth-building and financial security, including educational savings program for youth, adults seeking to build assets, parents seeking child educational assets, and efforts to build financial security for those with disabilities. Research has demonstrated that financial inclusion has psychological impacts regarding economic strain and provides a vehicle for saving to smooth consumption during periods of income instability. Despite these efforts, approximately 8% of the U.S. population is unbanked, and another 20% is underbanked (i.e., banked, yet use Alternative Financial Services), and struggle with inclusion.  In order to promote evidence-based financial inclusion efforts through policy and practice efforts, further research is needed about the effects of financial exclusion, and elements that contribute to financial inclusion and its importance related to wealth-building.

 This symposium will provide empirical evidence about the importance of and factors that contribute to financial inclusion for financially vulnerable households. The first paper uses evidence from the National Financial Capability Study to examine the association of Alternative Financial Services (AFS) usage and financial inclusion. Results indicate that being unbanked predicts AFS usage independent of financial education or financial knowledge. Findings indicate an overall expression by the unbanked of need for banking services, rather than a reliance on a cash economy. The second paper examines the influence that the community-level contexts may have on credit card use for college students.  Results indicate that average total household debt of the communities in which college students’ lived prior to college enrollment was negatively associated with their credit use, suggesting that students from higher debt communities were less likely to become leveraged themselves. Findings indicate community level factors, such as higher unemployment rates and more bank branches, were associated with accumulating more credit card debt over time. The third paper examines financial fragility (i.e., bank account ownership and savings level), and its association with housing instability for single parents.  Binary logistic regression was used to determine if financial fragility was associated with housing instability. Results indicate that single mothers were excluded from the financial mainstream and financially fragile. Financial inclusion and financial fragility were significantly related to housing instability. These three presentations will collectively focus on important research questions that can inform and shape policy and practice interventions aimed at promoting financial inclusion.