Ahead of the Autumn Budget, here’s how we add £6.4bn to the UK economy

5.6 million Britons don't exist. Not literally. They pay taxes, hold jobs, some even own businesses. But to the financial system, they are invisible. No credit score means no credit history, which means no mortgage, no car finance, often no phone contract. For lenders, they are perceived as “too risky”. But to me, they're just careful.

I run SteadyPay, a fintech that lends to people banks won't touch. When we analyse these "invisible" borrowers using their actual bank account behaviour (e.g. income patterns, bill payments, spending habits) instead of traditional - and frankly, outdated - credit scores, something remarkable happens. Often their repayment rates match or beat traditionally scored customers. The 20-something graduate earning £28k who's never had a credit card is often as safe as that guy with two maxed-out Amex’s and has a 680 Experian credit score.

Manufacturing exclusion

The paradox of getting credit is a tough one. You need credit history to get credit. But how do you get credit history without... credit? This is dismissed as an inconvenience for the few. Out of sight, out of mind for the mainstream. And a conversation happening far away from any budget conversations. However, and this is a massive HOWEVER given the predictions around Labour tightening the pursestrings next week, this is an expensive mistake. A £6.4 billion mistake.

That’s the figure that recent research from Fair4All Finance found that fixing financial exclusion could add annually to the UK economy. Suddenly "charity" looks a lot more like locked-up economic potential. A young entrepreneur can't get a business loan because she avoided debt during university. An immigrant doctor with a six-figure salary gets rejected for a £500 overdraft because he's only been in the UK two years. Both creditworthy. Both invisible. Both have economic potential.

Even the credit bureaus know it's broken

FICO, the company behind the algorithm that powers most credit scores, recently announced they'd start selling scores directly to lenders, cutting out Experian and Equifax. Experian's shares plunged 7% in a day. The firm that pioneered credit scoring is now admitting that, maybe, there's a better way.

There is. It's called using actual data about actual money.

At SteadyPay, we plug into customers' bank accounts (with permission, via Open Banking). We see everything: salary deposits, rent payments, Netflix subscriptions, that £4.50 daily Pret habit. Within seconds, we know if someone can afford a loan, and it’s not based on whether they've performed the ritual dance of credit-building. Instead it’s on cold mathematical reality.

The poverty premium strikes again

On a more personal level, being unscoreable makes everything cost more. If you can’t get a mortgage, you pay higher rent - particularly in places like London. Need emergency cash? That's a payday loan at 1,000% APR, because you're "high risk."

It's the poverty premium with a mathematical veneer. And it hits women harder. 13% of women have no credit file versus 8% of men. Regional disparities are wild too, with those in more far flung cities having less of a credit footprint than their counterparts in the capital.

The irony? The UK has lower household debt-to-income ratios than any time since 2002. People avoided borrowing post-2008, and stayed sensible during COVID. Now that prudence punishes them when they actually need credit for, say, a new roof or business equipment.

What needs to change

First, lenders must use Open Banking data. The technology exists. Seven million people in the UK have linked their bank accounts to financial apps. The infrastructure is there, and banks just need to accept that a two-year track record of paying rent on time matters more than whether you have a Barclaycard.

Second, we need to allow BNPL transactions toward credit scores. More than 10 million people in the UK have used the service in the last twelve months. And right now, someone can have five active Buy Now Pay Later plans - essentially five debts - and credit bureaus don't see them. That's insane. Either regulate BNPL (which the government's finally doing in 2026) or include it in scoring. Pick one.

Third, make rental payments count. Why does missing a mobile phone bill tank your score, but 24 months of perfect rent payments mean nothing?

The technology to fix this exists. The political will is growing. Fair4All Finance presented that £6.4bn economic case at the Labour Party Conference. Even FICO's pivoting.

What's missing is urgency. Five million people are locked out. And the cost to the UK economy is absolutely damning.

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