When you need someone - improving third party access in financial services

The Beatles once sang “I get by with a little help from my friends”. When we’re struggling with our mental health and our finances, those lyrics can hold very true. Four in ten (42%) people who experience a mental health problem want help with money management from a friend or family member. In 2016 and 2019, we looked at people with mental health problems’ experiences of getting that type of support – known as ‘third party access’. Six years have passed since that last report (named after the Beatles song). In that time, we’ve had a pandemic, a cost of living crisis and increased digitalisation of services. 

Today we’ve published a new report on this topic. If I needed someone (yes, another Beatles song), explores people with mental health problems’ experience of trying to get support from a friend or family member with their banking. This includes new insights from our Research Community – a group of 5,000 people with lived experience of mental health problems or for caring for someone. We’ve found that while there have been some improvements, many of the issues we highlighted previously still remain. 

Various mechanisms exist to give a friend or family member access to your banking services. This can be through a formal authorised mechanism, like a Power of Attorney (PoA), or an informal mechanism, such as direct agreements with banks, known as Third Party Mandates. However, our research shows that takeup of these mechanisms is low.

While 86% of Research Community members with lived experience had heard of a PoA, just 14% of those who had given someone else access to their account had used a PoA. Comparatively, two thirds (65%) had given access through an unauthorised route, such as giving someone their card. There are a few reasons for this low take-up. These include how hard it is to start the journey of getting support, particularly if you are struggling with your mental health and find things like processing information very hard. We also found that people with mental health problems can feel like these mechanisms give away too much power to a third party and do not meet their, often fluctuating, needs.

Our research also found that people with mental health problems and those that support them can face challenges with setting up and using these mechanisms. Our analysis of the Financial Lives Survey, a large nationally representative study, found that four in ten (39%) people who have conducted financial matters on behalf of someone else have had a negative experience while doing so. The most common experiences were poorly training staff, difficulties registering the mechanism and poor customer service. This was consistent with what members of our Research Community told us about their experiences and can cause significant frustration and worsen someone’s mental health.

The challenges with the authorised mechanisms can mean that people with mental health problems turn to other ways of receiving the support they need. Our research has found that over one in five (22%) people with mental health problems had shared their PIN or online account log-in with someone else. Other workarounds include giving someone a card or showing them bank statements. Research Community members told us they were using these workarounds because they were simple and could be done on a more adhoc basis. 

However, these workarounds come with a range of risks. For example, being the victim of financial abuse or fraud. Often, Research Community members were aware of these risks, and sadly, we heard stories of people being taken advantage of by those they had trusted. However, despite this, people told us they felt taking the risk was the only way to get the support they needed. 

In our previous reports on this topic, we also found that people with mental health problems were turning to risky workarounds to get the support they needed. However, there is one area where there has been some progress. We had previously highlighted the type of support that people with mental health problems actually wanted. This included more specific support rather than the broad approach of the existing mechanisms. For this report, we looked at what 18 banks and building societies publicly said they offered customers:

– Seven offer carer cards that allow someone to give another person a card to spend with;

– Three offer notifications to a trusted person, for example when they spend above a certain level, and;

– One allows customers to give a trusted person greater control over their account, such as turning on spending limits. 

We are excited to see the development of these needs based tools, as they offer the service that people with mental health problems are calling for. However, they are still not consistently offered by banks. 

We think there is more that banks and other financial service providers should be doing to make it easier and safer for people with mental health problems to get the support they need from a friend or family member. In an upcoming blog we will explore what these steps are. 

You can read the report here. We’re grateful to Nationwide Building Society for sponsoring this report. It represents the research and views solely of the authors and of the Money and Mental Health Policy Institute and does not represent the views or experiences of Nationwide Building Society.