Financial inclusion as a tool to fight poverty and social inequality
Thanks to developments in technology, financial services are more available to people than ever before. Inclusion is essential for economic development and eradicating poverty
To talk about savings banks and financial inclusion is to talk about the revered Scottish Doctor Henry Duncan. Despite that the concept of the modern bank emerged a century before his project in 1810, he was the man responsible for allowing those who didn’t necessarily belong to the upper class to get access to the banks. He envisioned a world where saving banks were made accessible to disadvantaged groups and individuals with the goal of putting an end to such social inequality.
Financial inclusion is fundamental to eradicating poverty and to achieving equal opportunity for everyone. Now, technology allows connections to be established with banks from anywhere around the world. For example, in some African countries, it is possible to find villages situated far away from large cities where bank branches are located. Farmers with no means of going to these cities cannot ask for financial assistance to maintain or promote their business.
In Kenya, only 20% of adults had a bank account in 2006, there were hardly ATMs and it was impossible to make wire transfers. People even exchanged prepaid mobile phone cards as a cash substitute. The arrival of transfer system M-Pesa changed this situation. It allows for money to be sent and saved in an easier way.
In Brazil, for example, Santander Bank launched Superdigital, an independent digital pay-for platform built as a checking account that allows the entity to increase the possibility for more clients regardless of their socioeconomic background. Financial inclusion is synonymous with prosper and allows people in less developed countries overcome situations of economic crisis, health related problems, unemployment, entrepreneurship…. as well as allowing women to become more independent, with a more active role in society’s advancement.