2 billion people do not have access to official financial services

    imageOne of the most exciting moments of 2015, especially considering what 2016 promises to be, is the fact that today financial technologies have reached a level where they can be useful not only for the powerful of the world, but also able to improve the lives of those previously had no access to advanced financial capabilities.

    In the lives of the majority of people living in developed countries, there are no obstacles that some regions face in relation to financial services. In one country, the presence of 3 credit cards for one person is considered normal, whereas the absence of a bank account may be in order for others. According to the World Bank, about 2 billion (38%) of the working adult population around the world cannot use official financial services. Financial technologies, such as those that underlie our Wirex service , which opens up access to instant money transfers without banking intermediation for users from all over the world, could be just the solution that will help these 2 billion people improve their lives.

    The problem concerns not only individuals. There are entire regions in the world where businesses, no matter how paradoxical it may sound, operate outside the financial system. More than 200 million registered and unregistered microenterprises, small and medium businesses in developing countries either do not have access to financial services at all or do not receive them to the extent necessary.

    Lack of access to official financial services is usually due to a lack of bank branches in settlements, as well as the reluctance of banks to serve the poor. In addition, poor people themselves do not show much desire to feel the full benefits of the official financial system, because they consider themselves too poor to get at least some benefit from it.

    The figure of 2 billion, of course, looks very impressive, however, in the expansion of access to financial services are well marked and positive trends. According to the World Bank, in the period from 2011 to 2014, 700 million people opened accounts in banks and other financial institutions and accounts in mobile payment systems. As a result, the number of adults deprived of access to financial services decreased by 20% from 2.5 to 2 billion people.

    Access to financial services is a key element in the everyday life of a modern person, because it makes his life in society more sustainable and allows him to save money for a rainy day and urgent needs. Access to financial services allows families to achieve excellent results.

    Studies show that the availability of financial services significantly improves the quality of life in many different ways. An example is the study of the impact of modern financial services on the quality of life of households in the African country Niger. Its authors have proven that families with savings or mobile accounts are fed more diversely and are able to plan food expenses.

    When banks in Mexico expanded access to their services, opening branches in retail stores, the average income in the settlements where it happened increased by 7%, and the employment rate increased by 1.4%. Another example is Kenya, where the use of the M-Pesa mobile money service has made it easier for families to experience the effects of financial and other shocks. According to a World Bank report, the consumption level of families that did not use M-Pesa fell by 7–10% in difficult times.

    Every FINTECH player who makes the life of those in need is easier, changes the world for the better. Wirex, Stellar, Oradian, RemitRadar and Monese are among such companies.

    Wirex- is a comprehensive financial solution that combines the advantages of blockchain technology, digital currencies and everyday payment services: mobile banking, represented by the same application, instant money transfers and dual currency debit cards. The Wirex application is a convenient and secure mobile platform that allows users to perform financial transactions around the clock. For instant money transfers, our company uses blockchain technology, which allows us to make significant improvements in the current scheme of transferring funds abroad. Remittances can be made instantly and safely, without removing any fees for international transfers (but taking into account the exchange rate).

    With a dual currency debit card, its owners can convert digital money into traditional currencies and vice versa. All services are provided without banking intermediation. Access to them is carried out around the clock. At the same time, users do not need to visit the offices of financial institutions - you can order a card or send a transfer online anytime from anywhere in the world. You can test the mobile application by downloading it from Google Play or the AppStore

    Monese created by Estonian Norris Koppelprovides digital banking services, in which everyone, regardless of their citizenship, can open a bank account in the UK directly from their mobile device. The service was launched last September, after a three-month beta test. His target audience is immigrants who have problems opening a bank account in the UK. To create an account and receive a Visa debit card, you only need to provide a photo of your passport and selfie, and the procedure itself takes no more than three minutes. According to Monese, their international remittances are only 0.5% more expensive than the average market price, which allows them to offer 10 times more favorable prices than large commercial banks. Stellar

    Companies, Stripe-supported open payment network, and Oradian , a provider of cloud-based software for microfinance institutions in developing countries, have joined forces to organize an instant money transfer service in Nigeria. The new payment system will allow 300 thousand residents of Nigeria (90% of this figure are women) to make cheap money transfers between microfinance institutions operating in the Stellar network. However, it is not yet possible to talk about total comfort: users will still need to visit branches of microfinance organizations in order to send or receive funds. For greater convenience, it is planned to open 200 branches throughout the country, mainly in rural areas.

    Although high hopes are pinned on fintech, it would be unfair not to mention the giants of the financial industry, such as MasterCard and Visa, who also show interest in expanding international access to financial services. Last year, together with other financial institutions, MasterCard and Visa formed a coalition of partners whose goal is to achieve a level of accessibility of financial services for all the inhabitants of the planet by 2020.

    This coalition will focus its efforts on 25 countries, which today have a total of 73% of the total number of people deprived of the opportunity to use financial services. The greatest number of such people falls on India and China. In total, in these countries the figure is 32%. The list of priority countries also includes Bangladesh, Brazil, Colombia, Côte d'Ivoire, and others.

    According to LTP . You can order a two-currency Wirex debit card and evaluate the advantages of our online banking here . Subscribe to our blog, leave comments, ask questions, we will be happy to answer them.

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