The UK has lost its place in the top 10 of most financially inclusive countries, as the country has become more "backward-looking" compared to markets that are investing more in fintech.
Britain fell from seventh place to 11th in the 2024 global financial inclusion index produced by Principal Financial Group and the Centre for Economics and Business Research (Cebr), as overall financial inclusion improved, with greater improvements in many other markets.
Globally, financial inclusion improved for the second year in a row, more than three-quarters of markets seeing their scores increase.
But the report suggested the UK's decline reflected reduced support from the financial services sector and relatively smaller improvements in government support compared to other markets.
While the UK ranks relatively well for financial system support, it ranks near the bottom of the rankings for all financial inclusion metrics related to the support provided by employers for workers.
While the UK fintech sector is often hailed domestically, the report suggested is has not kept pace with global growth, which could be hindering the development of a stronger savings culture.
"The UK looks pretty backward-looking compared to younger markets, for example, in Asia which have ensured their financial infrastructure is tech enabled," said Seema Shah, chief global strategist at Principal Asset Management.
"A more digital financial system allows people to smooth their consumption, more easily track saving and spending, and push income potentials higher."
Regions like Southeast Asia and Latin America saw particularly strong gains in financial inclusion, driven by fintech growth and improved financial system support.
Singapore retained the top position for the third consecutive year, with first place in both government and employment support, which the report said were working effectively in tandem with the financial system to provide for businesses and individuals.