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Digital transformation is no longer an option, says the World Economic Forum. The paper “ Race without Borders: A Global Agenda for Inclusive Growth in the Digital Age” sees technology as a powerful engine to drive inclusive growth in all countries, though it also acknowledges that digital transformation is not sufficient in itself to deliver inclusive development.

If community financial institutions make just a few adjustments and efforts specific to the needs of these consumers, they could find themselves with a whole new group of customers.

The CDC reports, 61 million Americans(1 in 4 U.S. adults) have a disability that impacts major life activities. 13.7 percent of people with a disability have a mobility impairment with serious difficulty walking or climbing stairs while 10.8 percent have a cognition impairment with serious difficulty concentrating, remembering, or making decisions. Studies also show that disability is more common among more vulnerable groups in society: women, Native Americans, and lower-income adults.

According to Federal Reserve data, over one in five Americans do not have a bank account and rely on alternatives like check-cashing services, payday lenders and pawn shops.

A major influence contributing to this situation is culture. Minority and immigrant populations are more likely to avoid large banks and may assume local financial institutions are the same. Additionally, these groups are being targeted by newer fintech apps offering the ability to easily send and receive international payments, an in-demand need.

Community banks are financial institutes with a limited number of branches that primarily serve local businesses and the community. Often, these institutes are owned by private individuals or are family owned. Therefore, community banks are more likely to personally know and interact with the businesses and the community that they serve.

If community financial institutions make just a few adjustments and efforts specific to the needs of these consumers, they could find themselves with a whole new group of customers.

The roadmap towards inclusive banking

The inclusive bank of the future will provide its customers with an outstanding digital experience, encouraging them to use multiple channels to access their accounts. It will deliver a seamless customer journey by leveraging artificial intelligence, machine learning and natural language processing, powered by the latest in distributed ledger technology.

Activating ‘Digital First’

Digital is ubiquitous, inexpensive and more efficient. Many underbanked communities are targeted by fintechs due to the widespread use of smartphones. These digital banking methods can be more appealing to minority groups because it is a more seamless way to do banking. Such users do not have to live near to or travel to the institution. Community institutions need to be able to match such offerings, possibly through partnering or by accelerating their digital innovation roadmap.

Inclusive digital touch points

With the future of retail banking looking more like a digital shopping mall than a traditional bank, customer touch points are growing in complexity. While customers digitally interact with banks across multiple channels, they expect to be able to quickly and easily do so using their preferred device.

For financial institutions, providing an “omnichannel” experience has become essential.

Inclusive Financial Literacy and high-level awareness of products and services

Education is power. Some of the gaps in financial inclusions are due to a lack of awareness or misinformation. Providing financial literacy through a digital banking solution could help to gain trust and confidence of the community. A digital framework that operates through the bank could provide customers with information such as credit scoring and spending habits.

Open APIs – A bridge to an inclusive economy

The recent growth in FinTech has produced an explosion of new services. According to recent data, at least 50% of people are already using more than one service.

The world of finance is changing, and that change is being driven by the Open API. The new generation of financial products is being built on top of APIs, as it enables a range of opportunities to enhance customer experience and improve operational efficiency, while at the same time reducing costs. Open APIs are influencing how investors can expand their micro investment portfolios.

Expand Micro investment portfolios through Open APIs

Implementation of wealth management platforms through Open API innovation could help to create new innovative products and services such as cryptocurrency trading – leading to the growth and expansion of digital banking roadmaps.

Microcredit is the provision of small loans to low-income entrepreneurs and small businesses. It has been proven to be an effective tool in combating poverty. A study by the World Bank found that for every $1 spent on micro-credit, $2.50 was returned to society.

Widespread adoption of fintech

The recent growth in FinTech has produced an explosion of new services. According to recent data, at least 50% of people are already using more than one service. The most common combination is between mobile payments and personal finance management. That means there are plenty of opportunities for businesses who can offer both services under one roof.

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Tech Venturas Global is a boutique technology consultancy & services firm that focuses on Inclusive Solutions that drives Inclusive Digital Economies. We are a bunch who are thought leaders in the Inclusive Financial space for over 25 years and we follow an empathetic user experience design approach to all our development initiatives. As a digital transformation company, our engineers are fluent in developing digital transformation frameworks, Microservices, Open API Architecture and a host of other technologies to help the financial industry accelerate towards unlocking the full potential of Digital & inclusive Economies.

Talk to us to learn how we can help your bank activate its digital transformation roadmap.

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