A third of UK gig workers have lost out on a new home due to being declined by a bank, building society, or a renting agency, despite knowing they have affordability. 66% have been denied a loan, despite knowing they have a good credit score.
Financial institutions are more likely to approve an application from a PAYE worker than a gig worker because they have greater transparency of their income and employment data. This is according to fintech start-up Rollee, which provides access to income data. Rollee has revealed that 25% of financial institutions surveyed struggle to access all the income and employment data when assessing UK gig worker applications. The research revealed that 70% of UK gig workers struggle to get approved access to financial products. This figure has only improved by 6% since 2022.
Over a third UK gig workers are not confident that their bank has a complete picture of their income streams when they are applying for a financial service. Of 1001 gig workers surveyed, 66% have been denied a loan since being a gig worker, despite knowing they have a good credit score. On average, gig workers must apply for three credit cards or loans before being approved. 34% have lost out on a new home due to being declined by a bank, building society, or a renting agency, despite knowing they have affordability.
Are gig workers not getting the same service?
80% of gig workers believe they don’t have the same access to financial services as traditional full-time workers. Over a third of gig workers have considered giving up a freelance job to get a full-time job to improve their chances of gaining access to a financial service.
After applying, 68% of gig workers felt that the financial institution didn’t take the time to accurately consider all their income and employment data. Many gig workers are finding it difficult to find out why their applications are unsuccessful too. 42% said when they have been denied a financial service, such as a loan or mortgage, the financial institution has not provided a reason for the unsuccessful application.
Exclusion by financial institutions is simply one of the many challenges gig workers are facing. The data revealed that over the past 12 months, 86% of gig workers have taken on at least 2 additional jobs to manage financially during the cost-of-living crisis.
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Ali Hamriti, CEO and Co-founder at Rollee comments: “This research reveals that financial institutions are struggling to grant gig workers access to financial products because of a data disconnect in credit checks. This is having critical repercussions on the lives of many self-employed workers, causing them to face high levels of financial exclusion and being denied financial products despite having the necessary levels of affordability.”