How to Enable Financial Inclusion Using Technology

7 Sure Fire Ways To Find Out How Technology Could Help With Financial Inclusion
The rate at which disruptive technology is currently developing is inspirational. Apart from thinking how we can utilize some of these technologies to make life easy and comfortable, we are also tasked to ensure that we solve the societal problem of the unbanked and underserved populations.
One question asked in the digital technologies arena is how these technologies can help in attaining World Bank goals of improving shared prosperity and eradication of global poverty. The World Bank set up a goal in 2013 aiming to achieve Universal Financial Access for adults by the year 2020. This goal was aimed at each adult having a personal bank account to receive, send, and store money, as the initial step to achieving financial inclusion.
Banking Population Statistics
In a 2014 report, the World Bank asserted that 2 billion adults around the globe are unbanked - a decline of 500 million adults from a similar survey in 2011. Most of the unbanked population were from Africa, Asia, the Middle East, and Latin America.
Nonetheless, the U.S. does not have 100 percent banked population. Countries in Europe such as Sweden, Norway, Denmark, and Finland were among the top countries with 10 percent banked communities. Interestingly, Sub-Saharan Africa is the only region in the world that has more people on the mobile banking platform as opposed to the traditional bank accounts.
Inarguably, financial inclusion is a global concern and not simply an issue for third world countries. Several banking corporations and technology providers are looking into different ways the problem could be addressed. Similarly, governments are working hard to push for policies that will create meaningful opportunities to the underserved and unbanked populations.
Humaniq aims to use innovative technologies to break modern day banking and identification barriers. More importantly, it is the ability to create a user-friendly financial tool that takes care of the undereducated and socially disadvantaged.
A Future of Financial Inclusion
Several ways exist that reveal how technology can help with financial inclusion around the globe. We have listed seven of them which include:
Biometric Technology: For the first time, more people are gaining access to financial facilities through this technology. Humaniq will use this biometric face-recognition authentication to offer its users access to banking services. The Vietnamese Mekong Development Bank is a perfect example of biometrics in action. Similarly, the technology is being used by 2.5 million South Africans under the SASSA Debit cards. A case study conducted by FINO in India used biometric technology and provided doorstep services to all adults who were previously unbanked.
Video Tellers: Banks can economize and establish branches in the rural and low-income areas with this technology. It creates a win-win situation since the bank will acquire more clients while the customers have unimaginable possibilities by having the freedom and accessibility to banking services.
Blockchain Technology: The fear of losing banked money sometimes compels consumers to take alternative money storage measures. However, blockchain promises a fraud-proof system that wouldn’t be otherwise altered retroactively. This is the same technology employed by Humaniq and Bitcoin cryptocurrency.
Accessibility Options on ATMs: New technologies have included additional features that make the ATM accessible to clients with hearing and visual challenges.
Breaking of the Value Chain: The consumer now has several sources of financial products and services from non-banks for instance, data analytics.
Microbusiness Cloud: Notably, financial inclusion is also business oriented. It gives small businesses the competitive advantage they need for their establishment. SMBs are now able to access big data and analytics that established corporations enjoy.
Access to Credit History: Without a substantial credit history, financial institutions cannot offer their support to a start-up. However, fiscal technologies can harness all other sources such as mobile banks, and online payments to create a credit history.
The CEO of Humanq, Dinis Guarda believes that technology is the future of humankind. For financial inclusion to be fully achieved, we shouldn’t get stuck on existing innovations. Similarly, government policies must move at the same pace as technology and allow the best innovations to thrive.
Sources
Demirgüç-Kunt, A., Klapper, L. F., Singer, D., & Van Oudheusden, P. (2015). The global findex database 2014: Measuring financial inclusion around the world.
FINO. (2013). FINO: Leveraging Technology for Financial Inclusion. Retrieved May 05, 2017, from http://www.icmrindia.org/casestudies/catalogue/Finance/FINC082.htm
World Bank. (2015). UFA2020 Overview: Universal Financial Access by 2020. Retrieved May 05, 2017, from http://www.worldbank.org/en/topic/financialinclusion/brief/achieving-uni...