Ex-prisoners 'need access to financial services'
Banks must do more to help ex-prisoners open accounts, apply for credit and take out insurance, in order to keep reoffending rates down, a report says.
Exclusion from such services prevents many ex-offenders from finding work and securing a home, the Prison Reform Trust and Unlock said.
Life without an account or insurance was a "second sentence", they said.
The Prison Service said it was working to make more banking schemes available to prisoners while they are in jail.
It said "gaining employment, living in stable accommodation and having the ability to use and access appropriate financial products" contributed to the rehabilitation process.
Many former inmates struggle to open a bank account because they do not have the list of former addresses, identity documents and credit history required.
Without a bank account, employers may be reluctant to give them a job - as there are few jobs where salaries are not paid either directly into a bank account or by cheque.
Newly-released prisoners may also have difficultly renting a property, as many landlords demand payment by standing order or direct debit.
As part of the research, the Prison Reform Trust and reformed offenders group Unlock spoke to 144 people in prison, as well as 24 former prisoners and 29 families of people with convictions.
The poll suggested a third of people in prison did not have a bank account, and more than half had been rejected for a loan. Four out of five people had also had problems getting insurance.
People in prison were also 10 times more likely to have borrowed money from a loan shark than the average UK household.
The report calls for inmates to be able to open a bank account and receive lessons in handling money before they leave prison.
People should also be able to manage their bank accounts while in prison, and prisoners should have the opportunity to earn a real taxable wage, enabling them to save money, support their family or reduce debt.
The groups would also like the insurance industry to lift its blanket ban on offering cover to people with convictions, while the credit industry should develop ways of treating ex-prisoners more fairly.
Chris Bath, director of projects at Unlock and co-author of the report, said: "If we want people to lead productive lives, working, paying taxes and providing their family with a home, we cannot allow the justice system to sever people from their finances, even less to create lifelong financial exclusion."
Juliet Lyon, director of the Prison Reform Trust, said: "Far too often people leave prison only to face a second sentence of no insurance or banking, mountainous debt, loan sharks circling and a family to provide for.
"The rehabilitation revolution stands or falls on banks, insurers, public agencies and government working together to allow people to take financial responsibility for themselves."
A Prison Service spokesman added: "We are working with the British Bankers' Association, the banks and Unlock to increase the number of banking schemes across the prison estate.
"Engaging the expertise of independent organisations like businesses and charities is vital to changing people's lives and stopping the revolving door of crime."