Social housing residents must be given help to get bank accounts otherwise the government’s new benefit payment system could lead to rising rent arrears and personal debt, the National Housing Federation has warned.
A report by financial exclusion experts Toynbee Hall, commissioned by the National Housing Federation, warns that there is little appetite among mainstream banks to provide a solution. The Federation is therefore calling on the government for a national programme of support to improve how social housing residents access and use financial services.
From October 2013 the new universal credit system will combine the different types of benefit payments into a single monthly payment. Support for housing costs will be paid directly to the resident rather than the landlord.
The report found that many social housing residents don’t have a bank account, or only have a Post Office account, which doesn’t allow outward payments. It also found that due dates for rent and benefit payments rarely coincide, making it even harder for residents to pay their rent on time.