Global CEO and Co-founder, Salary Finance
Head of Pensions and Benefits, Marks and Spencer
Workers are facing times of greater financial difficulties as their pockets are hit by economic hardships. It’s now more important than ever for employers to consider financial wellbeing strategies to help.
As new price rises hit on the back of the COVID pandemic, workers and their families are struggling to get a grip on their finances. The upshot has seen a sharp rise in borrowing and a slump in savings.
However, this is not a new trend. According to Citizens Advice, 10% of employees were already behind on their bills prior to the pandemic, a figure that has increased to one in seven during the past couple of years.
The Resolution Foundation found that in the last two years 42% of adults reported using at least one form of borrowing to cover everyday living costs, with lower incomes more likely to use higher cost consumer credit. With regard to savings, 11.5 million people have less than £100 in savings to fall back on.
Growing financial stresses
COVID is responsible for an even bleaker situation for many parents with one in five having to borrow or use credit more than before the pandemic. And 25% of ethnic minority key workers reported that they were more likely to struggle to pay an unexpected bill of £100 during the health crisis according to the The Royal Society for Arts, Manufactures and Commerce (RSA).
All of this is continuing to take its toll on the workforce and, in turn, is having a detrimental effect on performance and productivity. Some 64% of employees say financial stress is negatively affecting their work.
In a bid to alleviate these issues many companies are already providing employees with much-needed help. Among those leading the way is Marks and Spencer (M&S), where health and wellbeing sit at the very heart of its core values, which includes financial wellbeing.
Since partnering with Salary Finance we’ve seen strong engagement from our colleagues.Nicola Morgan
Demand for financial support
The High Street retailer, with up to 70,000 employees working either in-store, at its distribution centres or in the office, carried out a reward survey in 2020 in order to hear direct from their colleagues what mattered most to them – and financial wellness support was among their top priorities.
Nicola Morgan, Head of Pensions and Benefits for M&S, says: “This was really clear feedback from colleagues about what support they were looking for and we wanted to find a simple and accessible way to offer this.”
Financial wellbeing strategy
This led to M&S teaming up with Salary Finance, which provides a holistic suite of financial solutions that support employees how, and when, they need. The business introduced loans available at highly competitive rates repaid straight from payroll and an online learning platform full of easily accessible financial guidance, actionable tips and practical tools.
Morgan says: “Since partnering with Salary Finance we’ve seen strong engagement from our colleagues. For example, during January 2022 over 3,500 colleagues visited Salary Finance and, while the majority were there for guidance and to explore what was on offer, about 8% applied for a loan. We view a good suite of financial wellness tools as a critical benefit for our people in order to help equip them with the tools for the financial resilience they are looking for. We won’t stand still either and will continue to evolve our financial wellbeing strategy.”
Providing actionable, affordable support
Asesh Sarkar, CEO, Salary Finance, says: “We are proud that some of the UK’s largest companies, like M&S, trust us to look after their people’s financial wellbeing. We provide practical solutions to support employees’ to improve their financial health and overall happiness through building better money habits.”
Sarkar’s company is the largest in its market, trusted by more than 600 employers and reaching five million employees across the UK and US.
“We’re the most affordable, accessible and inclusive financial wellbeing offering of its kind. Our solutions are free for employers to offer and we have saved employees more than £10 million in interest alone. With the ever-increasing cost of living, we know that helping people consolidate high-cost credit can help put money back in people’s pockets, and we’re committed to working with our employer partners to improve the financial resilience of their workforces.”