Improving Financial Inclusion in General
Financial inclusion is the concept of providing banking services to every resident of a country. It is about making sure that people have easy access to financial services so they can start, run and grow their businesses, take risks with investing money or use it for basic things like buying school uniforms or having medical care when needed. Access to finance has become a key driver for economic growth. Poor people are often the most vulnerable in any economy, and this is especially true in low-income and emerging markets where banks are rare and savings accounts rarely available to most people. Financial inclusion helps lift everyone out of poverty by giving them greater access to capital and credit.
These steps can help you increase financial inclusion in your organization through programs that target underserved groups or support new entrepreneurs.
Steps to increase financial inclusion in your organization
1. Set achievable goals and measure your progress regularly
The way you measure progress will vary depending on your strategy and goals. But, whatever they are, it is crucial to set specific targets. When it comes to increasing financial inclusion, a key question is “how many people do we reach?” If your aim is to have one million more individuals with bank accounts by the end of the year, then you have to know how many individuals you currently have. Setting specific targets also lets you know if you are on track. It can be frustrating when you have a lot of people who want to use banking services, but they are hard to reach. If you don’t set targets, you won’t know if you are making progress.
2. Stop thinking of financial services as a one-time donation
Too often, people are introduced to financial services as a one-time donation. This is an important first step, but it does not address the underlying issues that lead many people to be financially excluded in the first place. Instead of thinking of financial services as a one-time donation, think of them as a regular service that is offered once a week, once a month, or once a year. If you offer financial services in a limited way, like providing loans to businesses or people with assets such as livestock, you can make it easier for people to access the services they need. Why it matters: Financial Inclusion is an ongoing process that lasts a lifetime. It doesn’t end when someone receives a bank account or takes out a loan with auto loan software. It also includes building the financial skills of people so they can make informed decisions for themselves and their families. Leaving financial services as a one-time donation means that people need to start the process all over again.
3. Ditch the digital divide by integrating technology into the services you offer
Financial services need to be available to everyone, regardless of their location or access to technology. However, in many low-income and rural communities, there may be significant barriers to accessing technology, including limited access to electricity, unreliable phone signals, and high costs of internet access. Fortunately, many low-cost technologies can be used to provide financial services such as pay stub generator or Mobile banking, for example, allowing people to access their accounts and send money via mobile phone. This can be especially helpful for people who don’t have a traditional bank branch nearby, but still, have access to a mobile phone network.
4. Find ways to build financial skills among young people
Young people are often seen as a key demographic for financial inclusion efforts, but many are not as financially savvy or sophisticated as older generations. This can often be attributed to a lack of financial education during childhood. Young people can also be at a significant disadvantage if they don’t have access to a computer or internet connection at home. Without technology, they may be less likely to learn about money and start earning it. There are several ways that government agencies and organizations can encourage financial inclusion through youth-friendly programs. One way is to encourage young people to become financially literate. This could include encouraging them to read financial books or blogs, participate in financial education classes or receive financial counseling.
5. Be sure everyone has a voice in the conversation about how money is used
Anyone who wants to use a financial service needs to have a way of accessing that service. This means that you need to be inclusive with your offerings, find ways to reach underserved populations, and build financial services that are available to everyone. There are several ways that you can be more inclusive. One way is to look at your organization’s offerings and ask yourself if anyone who isn’t part of the traditional target audience is likely to be excluded. Why it matters: Financial inclusion is about empowering people through access to financial services. If you’re providing these services only to certain people, then you’re not providing these services to everyone.
Effective financial inclusion strategies build long-term change. They require a long-term focus, a clear vision of where you want to be, and the commitment to make it happen. They also require a long-term investment in people and the environment. These are all needed to build sustainable financial inclusion. The good news is that financial inclusion does not require a large financial outlay or complex changes to your organization’s structure. In many cases, it just requires a shift in mindset among those working in your organization. All of these steps help you think about financial inclusion in a new way. They also help you think about financial inclusion as more than just new services. They help you think about financial inclusion as a way to build a stronger, more sustainable organization.