Finding ontological security in a world of precarity : a sociological study of the use of high cost credit by people on low incomes
People on very low incomes can often pay the highest rates of interest for credit. This research aims to explore the experiences of people on low incomes who use high-cost credit to understand why people with the fewest financial resources are prepared to pay so much for credit. This thesis is situated in the field of microfinance, but the analysis also demonstrates relevance in the sociological fields of emotions, consumption, poverty studies, and working-class credit. 31 in-depth interviews were conducted with Moneyline customers. Moneyline is a not-for-profit Community Development Finance Institution which provides financial services including responsible and affordable personal loans, savings, and household insurance to people who find it difficult to access mainstream financial services. The interviews were analysed using grounded theory methodology which allowed participants to guide the direction of the research question, and limited bias which was a criticism made of earlier studies in this field. Grounded theory was used to explore this field as there was scant prior knowledge of it. A theory was developed which explains how people on low incomes manage the negative emotional reaction they experience as a result of financial and social exclusion, by using credit from a not-for-profit lender. Findings indicate that participants felt that credit improved their financial and social inclusion despite poverty-line incomes and poor credit scores. Former negative emotional responses to financial and social exclusion were transformed, by financial and social inclusion, into positive emotional responses. Despite continuing external precarious financial and social circumstances, participants felt a deeper sense of ontological security. The unique contribution of this thesis is that it challenges the pejorative narrative attached to high cost credit. It provides original empirical evidence to demonstrate the value low-income participants place on access to high-cost credit. Furthermore, this thesis makes an important contribution to knowledge regarding the emotional impact of financial inclusion for people on low incomes. It identifies how participants felt that credit increased their financial resilience, promoted emotional wellbeing, and reduced the lived experience of poverty.
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