Fintech companies are leveraging technology to bridge the gap and provide essential financial services to millions of people around the globe. In today’s world, there are still millions of unbanked or underbanked people who lack access to basic financial services, such as having a basic savings account, access to loans or insurance.
One of the most significant barriers to financial inclusion is the lack of access to physical bank branches. In many developing countries, there are simply not enough bank branches to serve everyone. Therefore, mobile banking and digital payments have made a big push in providing financial services to the unbanked or underbanked population.
According to a report by GSMA, mobile money services were available in 96 countries as of 2020 and have reached over 1 billion registered users worldwide.
With mobile banking, people living in rural villages or high mountains can now access basic financial services through their mobile devices without the need to visit a physical bank branch. Through fintech, it is now easier for people to save money, make payments and access loans.
Digital payment is another innovation that is making financial services accessible to the unbanked. With digital payments, people can make transactions electronically. Fintech companies are leveraging this technology to provide low-cost and easy-to-use payment systems. Users can easily send and receive money using their mobile phones or a digital device. This has also make it easier for SMEs to send money to foreign suppliers, clients and employees.
FinTech and SME Finance
Traditionally, Micro, Small, and Medium Enterprises are underserved. However, Fintech companies are transforming the SME financial landscape. Through technology, these companies are able to offer more affordable products and services through cutting out manual tasks, not having physical branches and eliminating intermediate players. SMEs are able to access financial services and products, which can help simplify the daily lives of SMEs. Digital banks give SMEs access to financial support they might not receive at a traditional bank.
Fintech has the potential to bring financial services to millions of people. It has also made it easier for SMEs and startups to access financial services, get loans and conduct cross-border payments.
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