Fintech to the Rescue: How Technology is Empowering the World’s Unbanked

The world of finance is undergoing a revolution and fintech companies are leading the charge! With cutting-edge technology, these innovative companies are smashing barriers and bringing financial services to the world’s underbanked and unbanked population who have been grossly overlooked by traditional financial institutions.

This not only closes (read: tightens) the financial inclusion gap, but also empowers individuals and communities to take control of their financial future.

Imagine overlooked and unbanked populations being able to readily access banking services, loans and credit with just a smartphone, regardless of your location or socio-economic background. This is the reality that many fintech companies are making possible...and guess what? We’re here for it.

The Global Unbanked

However, according to a report by the World Bank, there are still 1.7 billion adults globally who are unbanked. This means that they do not have access to formal financial services such as savings accounts and credit. The majority of these individuals live in developing countries, where traditional financial institutions often struggle to serve remote and underserved communities.

Fintech in Action

Fintech companies, on the other hand, are using technology to reach these populations in new and innovative ways. For example, mobile money providers like M-Pesa in Kenya and bKash in Bangladesh have been able to bring banking services to millions of people who previously had no access to formal financial services. These companies use mobile phone technology to allow individuals to send and receive money, pay bills, and even take out loans, all without ever having to visit a physical bank branch.

bKash and WomenEmpowerment

bKash's services have been particularly beneficial for women in Bangladesh, as they often face barriers to accessing traditional financial services. bKash's mobile banking services have allowed more women to gain financial independence and participate in the formal economy. bKash's innovative approach to providing financial services to the unbanked population in Bangladesh has been a game-changer in the country, and it serves as a model for other countries looking to close their own financial inclusion gap.

Another initiative that bKash has implemented is the ‘bKash Her’ service which is designed specifically for women. bKash Her is a mobile banking service that provides women with access to financial services through their mobile phones, including the ability to make transactions, pay bills and access credit. This service is particularly beneficial for women who may face barriers to accessing traditional financial services, such as lack of education or social restrictions.

Furthermore, bKash has also been working to promote financial literacy among women inBangladesh through various awareness programs, training and seminars. This has helped to empower women to take control of their financial future and become financially independent. Quite remarkable.

Overall, bKash's innovative approach to providing financial services to women inBangladesh has been a game-changer in the country, and has helped to empower women to take control of their financial future and become financially independent.

Micro loan Magic

Another example are companies like Tala and Branch, which are using mobile data and machine learning to provide micro loans to individuals and small businesses in emerging markets. These companies use data from individuals' mobile phones to assess creditworthiness, allowing them to provide loans to individuals who would not qualify for traditional bank loans.

Tala, which provides loans and financial services to consumers in emerging markets (in countries such as Kenya, Tanzania,Philippines, and India), helps its consumers by providing them with access to credit through its mobile app.

The Tala app uses alternative data, such as phone usage and transaction data, to assess the creditworthiness of potential borrowers and provides them with loans in a matter of minutes. This allows individuals who may not have access to traditional banking services or a credit history to access credit and improve their financial situation. Pretty cool.

Another wayTala helps its consumers is by providing them with financial education and tools to help them manage their finances. The Tala app includes features such as spending tracking, budgeting, and savings goals, which can help consumers make better financial decisions and improve their financial literacy.

In addition, companies like Square Capital are using technology to help small businesses access the capital they need to grow and thrive. Square Capital provides small business loans to merchants using data from the Square point-of-sale system, allowing them to make lending decisions quickly and easily. These are just a few examples of the ways in which fintech companies are using technology to empower the underbanked and unbanked.

According to the World Bank;

‘In developing countries today, 71% of people have an account, up from 42% a decade ago. Globally, 76%of adults around the world have an account today, up from 51% a decade ago.These tremendous gains are also now more evenly distributed and come from a greater number of countries than ever before.’

However, there is still much work to be done. The financial inclusion gap remains a significant challenge, however fintech companies are not just providing financial services to the unbanked and underbanked population, but they are also arming them with the powerful tools to take control of their financial lives and make informed decisions that can change not just their destinies, but those of future generations to come.

These innovative solutions are not only empowering individuals and communities, but they are also driving a revolution in economic growth and stability. These new technologies are opening up opportunities for people who were previously excluded from the financial system, allowing them to access credit, make transactions, and build a better future for themselves and their families.

With fintech, financial services are available to all, regardless of their location, socio-economic background or gender, which brings a sense of equality and fairness. And who doesn’t want more of that in the world?

The impact of fintech is nothing short of a revolutionary force, transforming the financial landscape and forever altering the way we think about financial inclusion and economic development. As they say, onwards and upwards!