Accelerating financial inclusion to reach the unbanked
According to the International Monetary Fund (IMF), financial inclusion – defined as access to affordable and accessible financial services – is the bridge between improved economic opportunity and increased economic outcomes.
But building that bridge has not been easy in Nigeria as the country has barely scratched the surface of providing financial inclusion for all of its population.
Research shows that while there has been some progress in achieving better financial inclusion in the past few years, there are still several hassles individuals and businesses face daily in order to access affordable financial services.
An example of such hassle is access to a quick loan. In today’s banking system, you would most likely have to wade through an endless clutter of procedures to access a quick loan from your traditional bank. This is a pain point for many people in the middle and lower economic class, particularly the underserved, as they now shift towards age-old informal mechanisms – relatives, friends, money-lenders, or savings schemes.
These informal mechanisms are insufficient, unreliable, and can be very expensive. Financial exclusion hence imposes large opportunity costs on those who suffer from it the most. When coupled with information asymmetries and high transaction costs, the underserved who lack collateral or credit histories are stuck in a bad equilibrium with no escape.
Another difficulty you might be familiar with is being able to complete simple transactions such as paying utility bills or making multiple money transfers.
While a lot of people have gotten the hack of these simple transactions, many are still unable to achieve these without joining a long queue at a distant bank branch. Even when a queue is avoided, the incessant charges and limitations that accompany such transactions dig deep into your pockets which makes the process undesirable.
However, in today’s digitally-pulsating world, we simply cannot afford such problems anymore.
The Branch solution!
With the unique needs that arise in today’s digital world, there is a need to access financial services conveniently and without delay, irrespective of an individual’s economic and social status. Digital banking is the solution that allows the unbanked and underbanked categories to access financial services with ease and interestingly, people in the lower economy are getting more familiar with the prevalent opportunities available to them digitally.
Geographic constraints such as inaccessibility, distances, and lack of proper infrastructure; as well as social constraints like illiteracy and class barriers which have posed as a hindrance to financial inclusion over the years, can be solved with digital banking and the range of innovative services it offers. With this, the unbanked can also get more financially included through accessible services like easier payments, savings, lending, and micro-lending.
With the rise of efficient and innovative finance platforms such as the personal finance app, Branch, there are no barriers to accessing the best and most needed financial services. Branch provides access to instant loans of up to ₦500,000 with no physical documentation as well as free transfers/bill payments, and investment yields of 20 percent per annum.
By leveraging technology and innovation to provide smart alternatives to traditional banks, Branch plays a huge part in accelerating financial inclusion and access to financial services to underserved communities in Nigeria.
Now you can access affordable and trusted financial services by downloading Branch on the Google Play Store to get services that are better than your bank!