Financial exclusion is the inability of individuals or communities to access basic financial services, such as savings, credit, and insurance. This can be due to a variety of factors, including access to banking infrastructure, demographics (like age), level of literacy or discrimination. However, poverty has proven to be the biggest inhibitor to financial inclusion.
Financial exclusion can be so damaging that many experts believe that access to financial services should be elevated to the level of fundamental human rights. There are some arguments that financial inclusion is similar to fundamental human rights. Proponents of this view argue that access to basic financial services, such as a bank account or a means to save money, is a basic human need and an essential component of economic empowerment and poverty reduction.
The United Nations has recognized financial inclusion as a key factor in achieving the Sustainable Development Goals, which include ending poverty, promoting gender equality, and creating economic growth. In fact, the UN has included access to financial services as one of the targets under Goal 8 of the SDGs, which focuses on promoting sustained, inclusive, and sustainable economic growth.
Furthermore, some proponents argue that financial inclusion should be considered a human right because it enables individuals to participate more fully in society and exercise their other rights. For example, access to financial services can help people to start and grow businesses, send their children to school, and access healthcare.
Governments and global non-profits have been driving decades-long agenda to reverse financial exclusion using a variety of means.
In recent years, local and international Fintechs have also joined this fight to ensure everyone has the access to financial services. Tech companies believe that mobile apps have the potential to improve financial inclusion by providing low-cost, accessible financial services to those who are otherwise excluded.
However, many experts are of the opinion that the use of mobile apps to solve financial inclusion problems may be biased and tone deaf.
First of all, it is important to recognize that simply creating a mobile app does not automatically solve the problem of financial exclusion. There are many complex social, economic, and cultural factors that contribute to financial exclusion, and these cannot be addressed solely through technology.
Furthermore, building an app for financially excluded individuals requires a deep understanding of their unique needs and challenges. For example, many financially excluded individuals may lack access to reliable internet or may not be comfortable with digital technology. The app must be designed with these considerations in mind to ensure that it is accessible and user-friendly for all potential users.
In addition, there is a risk that a mobile app designed for financially excluded individuals may unintentionally introduce harmful stereotypes or reinforce existing power imbalances. For example, an app that assumes all financially excluded individuals are unbanked and therefore in need of basic financial education may overlook the many subtle reasons why someone might be excluded from financial services.
However, the elephant in the room for the use of mobile apps to solve financial inclusion is poverty. How would those who are financially excluded, due to poverty, and who are the majority, be able to afford smartphones that would be used for these apps. Illiteracy and poverty go hand in hand. Even if they were gifted smartphones, there would be the frustration of knowing how to use these advanced technological wonders to their own advantages.
In conclusion, building a mobile app for financially excluded individuals can be a powerful tool for improving financial inclusion. However, it is important to approach this task with caution and sensitivity to the complex social, economic, and cultural factors that contribute to financial exclusion. By designing apps that are accessible, user-friendly, and culturally sensitive, we can leverage technology to help address one of the most pressing issues facing our global community today.