Ascension Fair By Design Fund Partners With Nationwide Launching Startup Incubator Tackling The Poverty Premium
Ascension and Nationwide launch new start-up challenge to help tackle the Poverty Premium
(Original press release published on Nationwide Media Centre page)
- Nationwide calls for innovative ideas to help tackle the Poverty Premium with a new challenge
- UK’s brightest talent asked to step forward with winning ideas that will be developed and scaled up
- Start-up business challenge launches alongside a £2.5m investment in the Fair By Design Fund
- Applications open 24 February; programme supported by charities and organisations across the UK
Covid-19 has had a detrimental impact on the finances of many households – a situation that will be exacerbated when the furlough scheme ends. Some estimates suggest that almost 700,000 additional people faced poverty during the Winter of 2020 as a result of the pandemic (1).
While poverty in the UK is a serious issue, the lowest paid are subject to a Poverty Premium of up to an extra £478 a year for essentials (2) due to increased costs of services and access to finance. Nationwide, as a mutual, believes that society must be fair for all, no matter what their circumstances. The Society is convening a group of expert charities and organisations to support a new start-up business challenge and incubator designed to tackle the Poverty Premium.
Nationwide is investing £2.5 million in the Fair By Design (FBD) Fund, a venture fund managed by Ascension Ventures providing capital to help grow businesses that make markets fairer. This was part of a £5 million fundraise extension to FBD’s existing £10 million fund. The new £15 million fund welcomes Nationwide Building Society as its lead investor in this round, alongside organisations such as Esmée Fairbairn Foundation and The Places Foundation charity, which is supported by Places for People.
Alongside this investment, Nationwide will also launch a start-up business incubator programme aimed at supporting businesses tackling poverty in effective new ways. The programme will be supported by the FBD Fund policy and advocacy work, which is managed by Barrow Cadbury as well as charities and organisations with experience in tackling the day-to-day problems faced by people living in poverty in the UK.
Applications will open on 24 February and the first challenge is focused on six main themes:
- Affordable credit
- What happens if you are declined for credit
- Fair access to essential goods and services
- Income smoothing
- Wider implications of a poor credit score
The Society is looking for applicants with effective ideas for start-up or scale-up businesses, which can tackle issues associated with living in poverty. Applicants’ solutions can be at any stage, from a prototype to a live solution, as Nationwide is looking to help tackle the challenges poverty presents. Applications will be assessed by charities, data and other experts to assess the viability and potential impact of each solution.
Successful applicants will join the Society’s Incubator which has two phases – Explore and Build.
In Explore, organisations will receive £30,000 of investment from Nationwide to support three months of investigation alongside support from experts through testing and development.
Companies that complete the Explore phase and deliver a tested, scalable solution will be considered by Nationwide and Fair By Design for a subsequent Build phase, an additional six months in the incubator to build and scale their solutions, for which funding will also be available.
Alongside funding, businesses will be supported at both stages with workshops and expert mentors from Nationwide and partners to help build a sustainable and successful business.
Claire Tracey, Nationwide’s Chief Strategy and Sustainability Officer, said: “As a mutual, we believe in the power of collaboration and that we can achieve more together than we can alone. Building on the success of the Society’s Open Banking for Good initiative, the Nationwide Incubator will bring together innovators, charities, organisations and experts to help tackle the scourge of the Poverty Premium.
“Individuals living on a financial knife-edge are forced to pay more for basic goods and services. This is simply not right, nor fair. Through providing meaningful support alongside funding, we are looking to help transform the lives of those living in poverty through scaling long-term solutions to help tackle the challenges this presents.
“It is more important than ever that we act now. The pandemic has and will have, a significant impact on individuals and families across the country and without action risks millions more facing financial uncertainty and poverty. We hope that this programme will bring benefits to those who most need help.”
Jean de Fougerolles, CEO of Ascension Ventures, said: “Ascension has been managing the Fair By Design Fund for the past three years, investing in tech-for-good businesses that reduce key aspects of the Poverty Premium. This Nationwide partnership allows us to scale our work with a leading mission-led organisation to tackle the challenges faced by people impacted by the Poverty Premium across the UK. Together, we can change lives and back formidable entrepreneurs to scale market-led solutions to correct incredibly unjust market failures”
The Nationwide Incubator builds on the success of the Society’s Open Banking for Good Challenge which launched in 2018. Since then seven fintech start-ups received funding from the Society alongside support from experts in organisations such as Nationwide, Money Advice Trust and Citizens Advice to show how business, charities and government can work together to make a positive difference in society. Nationwide now has commercial partnerships with two participants, OpenWrks and Tully, to provide services for the benefit of its members.
Those looking to apply are encouraged to visit nationwideincubator.co.uk for further information. The deadline for applications is 4 April 2021.