As the world becomes increasingly interconnected, fintech services have become integral to the global financial ecosystem. Fintech services offer consumers and businesses a range of financial products and services that are convenient, efficient, and secure. However, the benefits of fintech are less prevalent in the global picture. Many parts of the world still need access to essential financial services. In some areas, the lack of traditional banking infrastructure has created an opportunity for fintech companies to step in and provide financial services that were previously unavailable.
Hence, it is imperative to globalize fintech services to ensure a secure future, and the following are some compelling reasons why it is crucial to do so.
Access to Financial Services
Access to financial services is critical for individuals and businesses to participate fully in the economy. However, many countries still need access to essential financial services like banking, credit, and insurance. According to the World Bank, approximately 1.4 billion adults worldwide are unbanked, which means they do not have access to formal financial services. This lack of access can have significant consequences, such as limited economic opportunities and increased vulnerability to financial shocks.
Fintech services have the potential to address this problem by providing low-cost, accessible, and convenient financial services. For example, mobile money platforms, such as M-Pesa, have revolutionized access to financial services in Kenya, where over 80% of adults now use mobile money services. Globalizing fintech services can help ensure that individuals and businesses worldwide can access the financial assistance they need to thrive.
Financial Inclusion
Financial inclusion refers to the accessibility of affordable and reliable financial services for individuals and businesses, regardless of their socio-economic background. Globalizing fintech services can help advance financial inclusion by expanding access to financial services, particularly in regions with inadequate traditional financial infrastructure.
India’s Digital India program is a prime example of this, as it aims to enhance financial inclusion by providing access to digital financial services such as mobile wallets and payment banks, which are especially useful in areas with limited physical bank branches. By leveraging fintech, governments, and financial institutions can create more inclusive financial systems that benefit everyone.
Cybersecurity
Cybersecurity is a critical concern for the financial industry, with cyberattacks and data breaches becoming increasingly common. Globalizing fintech services can help improve cybersecurity by promoting the adoption of best practices and standards across the industry. For example, the International Organization for Standardization (ISO) has developed a set of standards for information security management widely adopted by the financial sector.
Fintech services can also leverage new technologies, such as blockchain, to improve cybersecurity by providing a secure and transparent way of recording financial transactions. In conclusion, globalizing fintech services is essential for a secure future. Fintech services can help expand access to financial services, promote financial inclusion, improve cybersecurity, and enable international transactions. However, addressing the challenges associated with globalizing fintech, such as regulatory barriers and cultural differences, is essential to achieve these benefits. We can build a safer, more secure, and inclusive financial system for all by working together to overcome these challenges.
(This article is written by Praveen Paulose, MD & CEO at Celusion Technologies, and the views expressed in this article are his own)
