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Rethinking how we spend and save money isn’t just about whizzy mobile apps and open banking. Challenger banks are making it harder for you to spend money by changing financial systems to take the anxiety out of money and better protect us from falling into debt when our mental health fails.

That's the idea behind features such as Monzo and Starling Bank’s gambling block, which stops customers from spending at high street bookies or online betting sites. Once the mode is enabled, you have to wait 48 hours for them turn off – a bit of friction to discourage bad habits. “If you have a gambling addiction, or it’s something that has given you trouble in the past, in a moment of strength you can block yourself from gambling in the future,” says Hugo Cornejo, head of design at Monzo.


The charity Money and Mental Health has a wishlist of similar features for banks to introduce, calling for the ability to set your own spending limits, share account access with carers or your support network, and make it easier to track spending and saving. A recent survey of 5,000 people carried out by the charity found that 93 per cent said they spend more in periods of poor mental health because of increased costs and reduced impulse control.

Half of British adults with a debt problem have a mental health problem, says Sarah Murphy, associate director of advice, information and training at Rethink Mental Illness and Mental Health UK. “And we also know that people with mental health problems are more likely to get in to debt,” she adds. “It’s a really vicious cycle.” Indeed, Rethink’s advice service gets so many calls from people facing mental illness and financial troubles that it started its own Mental Health and Money Advice Service.

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While traditional banks do have support teams for vulnerable customers, their legacy IT makes it harder to roll out such features directly in their apps, whereas Monzo and Starling developed their gambling blocks in mere months. Helen Undy, director of Money and Mental Health, says her organisation has the same conversations about mental health tools with legacy banks as it does challenger banks like Monzo and Starling. “There are similar levels of enthusiasm, they get it, they understand why it matters,” she explains. “They get this stuff, but it does tend to take them quite a lot longer to act on it. And sometimes their legacy IT systems actually just mean that they can’t.”

For Starling, the work on the gambling block started when a customer named Tony Franklin contacted the bank. “He said he found the app really helpful, because we have designed it in such a way to deliberately take away some of the stress and anxiety around managing your money,” says Alexandra Frean, head of corporate affairs at Starling. In particular, Franklin appreciated the real-time spending insights section, which tells customers exactly how they’re spending their money, by merchant. “So you can see how much you’re spending at Starbucks every month – or in the case of someone like Tony, how much you’re spending at Betfair,” she says.


Franklin suggested the gambling block, an idea mental health charities have been pushing banks to enable. As most transactions are sortable by merchant code, making a gambling block was simple. “It’s not difficult for companies such as ours, which is built in the modern era,” she says. “It wasn’t a difficult thing to do.”

Hearing from customers about what features they need is key for tech startups, particularly with banking, says Cornejo, as it brings to the forefront issues of financial inclusion that likely don’t impact many well-paid developers and designers. "The people working in tech, we are a bunch of privileged people," he says. "So it’s very difficult to have the mindset of someone who is having trouble to survive [financially]."

Because of that, Monzo interviews its own users about how they use money, with this research leading the startup to use clearer language with its notifications, as well as developing new features. For example, one tool shows how much cash you have left to spend in a given month, making planning less stressful.

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For Monzo, the idea to allow customers to block gambling sites and shops came via a conversation with Undy’s Money and Mental Health organisation, and was picked up by one of the banking startup’s designers, who worked on it during his “Monzo time” – a day a month for developing your own projects. Monzo also picked up another idea from a joint hackathon held by the Financial Conduct Authority and Money and Mental Health, building at the event the first iteration of its “pots” tool, which save more easily but dropping money into virtual pots where it’s kept out of the overall account balance. “They took it back in house, improved it and rolled it out within the space of a few months,” Undy says.


Other ideas from the hackathon show the tie-up between banking and mental health could take a step further in the future. Capital One built a tool specifically for bipolar customers, letting them block certain types of transactions to avoid overspending; to unlock it, customers have to play a game to test attention span in order to add a bit of friction. Another idea suggested analysing spending data and social media feeds to spot when vulnerable customers need support.

Monzo also worked on a subscription management tool, which hasn’t yet made it into the app, Hundy says. It flags when subscription payments are due to go out, so customers can plan to have enough cash available, and be reminded to cancel the subscription if they no longer use it. “One of the things we found in our research was that people with mental health problems were more likely to buy on subscription and more likely to say they kept it going because they couldn’t navigate the process of unsubscribing or because they didn’t realise they were still paying for it,” Undy says.

Not all the features created at the hackathon will necessarily make it through to banking apps, but Undy says the aim is to get banks thinking about how they can better support customers. To help that process, Money and Mental Health is working on a set of standards for the financial industry, akin to what the RNIB does to encourage accessibility for those with visual impairment. “It’s been really clear for quite a long time how a bank can meet the needs of their customers with a visual impairment. That’s not to say that they’re always doing it brilliantly, but the evidence has been there about what they need to do and organisations like the RNIB have a set of standards that a bank can follow to help,” says Undy. “The same hasn’t been true for mental health.”

She notes that banks often require customers to call in over the phone, rather than use text-based communication such as messaging. But her organisation’s research shows half of people with mental health challenges find it hard to make a call. “It’s purely about accessibility,” she says. “It’s the mental-health equivalent of a ramp into a branch, it’s making sure that the only route into your service isn’t fundamentally inaccessible.”

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Starling’s Frean stresses banks making such changes aren’t trying to step in as health care providers. “We are trying to take the stress out of managing your money, but we don’t claim to be curing mental ill health,” she says. “But we are trying to contribute to mental good health by making your Starling app your hub or mission control for your finances, enabling you to visualise and manage all your money in the palm of your hand.”

Whether having more data about finances and real-time information about how much is in your account helps reduce stress hasn’t been tested by the bank, Frean admits. “Our thinking is that we will help them feel in control if they can see better where they are with their money,” she says, compared to a legacy bank that sends a statement once a month in the mail.

Plus, features that help remove stress for those with mental health challenges benefit all customers, be it through making budgeting easier, ensuring clearer terms and conditions, and simplifying communication with your bank. “It’s very rare that we hit upon a solution that would improve banking for people with mental health problems that wouldn’t improve banking for everyone,” says Undy, adding that half of us will experience a mental health problem at some point. “I think as technology improves and as the challenger banks start to make user experience an area for competition, we will start to see banking that better meets the needs of everyone, which will include people with mental health problems.”

Cornejo agrees. “Small things like this, either we do it or nobody else will do it,” he says. “In the end, the industry gets better.”

If your mental health is suffering because of financial stress, you can get free help via Rethink's Mental Health and Money Advice Service.

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