The financial services industry was traditionally dominated by a select group of institutions that monopolised the way we saved, borrowed and invested our money. The emergence of new technology, as it has done in so many other industries, has disrupted the status quo and broken up the longstanding control of those institutions. The result has been more choice for the customer as well as much greater access for those who previously may not have been eligible for traditional banking products.
However, in recent years, it has emerged that although many more people are now able to access the formal economy, there may also be a limit to the impact of digital financial technology (FinTech) which is hampering efforts to improve financial inclusion around the world.
With that in mind, we’re going to explore the impact FinTech has already had and look at why it may not be the panacea for financial inclusivity.
FinTech in action – what improvements have been made?
There’s no disputing the tremendous impact FinTech has already had on levels of financial inclusivity around the world. Figures from the 2017 Global Findex Database, which is published by the World Bank, reveal that globally, the proportion of adults with a bank account now stands at 69 percent. That’s up from 51 percent in 2011 when the Global Findex Database was first produced.
As you might expect, many of the FinTech success stories can be found in developing countries. For example, in Africa, a lack of access to finance has long been a barrier for small businesses and entrepreneurs. The rate of women’s entrepreneurship in Africa is higher than in any other region of the world. However, a report by the Graça Machel Trust charity found that 71 percent of those businesses were self-funded because of the difficulties associated with raising capital from the

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