Financial Capability and Investment Crowdfunding

Financial Capability Week logo. It's abstract, like an exploding star.

This week is Financial Capability Week in the UK. We'd like to offer our readers a brief introduction to the topics of financial capability and financial inclusion, and suggest some ideas for investment, and value-creating activities.

Financial capability is people's ability to manage their money well. That includes day to day management, but also managing the financial side of important life events, such as marriage, having children and changing or losing your job.  A lot of people aren't as good at that as they could be. 

Financial Capability Week takes place between 14 - 20 November 2016.  It's an awareness-raising week, so if you have never heard of financial capability before, this is the place and the time to get a basic understanding.  The website https://www.fincap.org.uk hosts the Financial Capability Strategy for the UK, and they have an introduction to Financial Capability Week  

Another Crowd is very interested in growing the biggest possible community of intelligent investors supporting small businesses and anything else they value, and an important part of that is spreading ideas and capabilities so that more people know that investment requires some intelligent thinking, but it's not an arcane, specialist or mysterious subject that has to be left to experts.

Most of investment is about taking money you can spare, and putting it somewhere to do the kind of work that  makes something increase in value, so that you get more back, in the future, when you need it. So if you're a novice investor, or you find it difficult to save for your future, you may find some financial capability resources help you understand what you need to learn. And if you're an experienced investor who worries about novice investors, maybe you'll get some ideas that help you talk to novices, perhaps by participating in an investor syndicate.

Financial capability is very helpful if you're thinking about how to stop your local post office closing, or take over a local pub, and it also helps people work out what to do with redundancy money or a divorce settlement. And you can do really basic things like teach teenagers not to run out of credit on their mobile phone.  

Here's a recent blog post that makes the very good point that if we want an economy that works for everyone, we need to give people the chance to their own money into things that matter to them.   inclusive growth without financial inclusion is impossible    And as Scotland's Herald newspaper pointed out last week, crowdfunding is unlikely to make the world a better place for people who haven't understood the difference between investing and saving.  

The Fintech angle

Financial capability also offers plenty of opportunities for Fintech investors. For an insight into this we turn to Chris Skinner of Financial Services Club, who points out that when we talk about the 'unbanked', there are millions if not billions of people in the developing world who have never seen a bank branch, never mind opened an account  Fintech, including the work of UK based startups, is helping banks leapfrog generations of technology. (Imagine what it's like introducing phone banking to  people who have never had a debit card or a cheque book.

This is an important point and should  not be overlooked when we're seeking out innovative projects and new technologies that can succeed in a global market (and in the UK and Europe.) Chris' post is on his blog, The Finanser, and is very readable.

Fianally, don't  overlook our post from last weekend on 150 years of Fintech.