"At a time when many households are facing growing financial pressures, our sector is uniquely placed to bridge critical gaps in protection, healthcare and savings."
- Andrew Whyte - AFM
The Association of Financial Mutuals (AFM) has called on the government and regulators to centre financial mutuals in the aim of closing the protection gap as the government looks to grow the mutual and co-operative sector.
The new strategy, Closing the Gaps: Building Financial Resilience, argues that mutuals can help individuals and families deal with financial shocks, claiming that member-owned mutuals are able to reach often-overlooked groups that mainstream firms and providers do not reach.
reducing pressure on the state and the NHS, and encouraging wider investment across the UK, beyond London and the southeast.
The strategy also identifies the capacity for mutuals to help close the healthcare gap by reducing pressure on the NHS and the savings gap by encouraging more investment nationwide, not just in London and the southeast.
The strategy also calls on the government to help mutuals close the protection gap by introducing frameworks for auto-enrolment into long-term protection products.
In addition, the strategy includes calls for the removal of barriers that discourage take-up of health cash plans, the reformation of rules that restrict mutuals’ ability to raise external capital, and the expansion of access to targeted financial support and simplified advice.
READ MORE: The protection gap won’t close without a national effort behind it
"Financial mutuals have a proven track record of supporting people through uncertainty and helping communities throughout the country build long-term resilience," Andrew Whyte, CEO of the Association of Financial Mutuals, said.
"At a time when many households are facing growing financial pressures, our sector is uniquely placed to bridge critical gaps in protection, healthcare and savings.
"This strategy sets out a clear and practical path for how Government and regulators can unlock the full potential of mutuals, not only to improve financial outcomes for individuals, but also to strengthen the UK economy beyond financial hubs such as London and the southeast. By enabling mutual firms to help close the gaps, the Government will also make progress towards achieving its 2024 Manifesto commitment to double the size of the mutual and co-operative sector.
"With the right support and reforms, mutuals can play a pivotal role in delivering a more inclusive, sustainable financial system that works for everyone."
