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A Look into Financial Inclusion in Myanmar and How Financial Technology Can Help it Further

A country that has undergone dramatic democratic and economic changes in the past 10 years, Myanmar is still in the midst of transition. Great turning points in the past decade for the country previously known as Burma included the wave of reforms aimed to grow the economy — one of which targeted the financial sector to further financial inclusion among the population.

As recent as 2017, less than 22% of adults in Myanmar had access to financial products and services. The use of mobile money was much lower, with about 1% of them owning a mobile money account despite the much higher awareness rate of these services. However, even if awareness of digital financial services is at 29%, there are gender, locality, and income gaps that favor males, people living in urban areas, and people who are above the poverty level.

How then can Myanmar extend financial inclusion to the underprivileged?

A financial inclusion road map is set in place to ensure that 40% of the adult population are financially included by the end of 2020. It also aims to increase the percentage of people using one financial product to 15%. The government of Myanmar recognizes that certain demographics were trailing behind so the roadmap is prioritizing three segments: agriculture, MSMEs, and low-income households.

Aside from government-led initiatives, the private sector is also helping to expand financial services across the country. Thanks to DaNa Facility, UNCDF, and the Asian Development Bank, an initiative called the Fintech Challenge Myanmar exists to further financial inclusion with the help of innovations in financial technology. Fintech companies collaborate and pitch solutions to fill the gap that rural people, micro-enterprises, and low-income households suffer from.

While awareness of digital financial services is at 29% in Myanmar, there is a high level of smartphone ownership in the country — making Myanmar’s adult population ready for widespread adoption of digital financial services. This readiness should be utilized by fintech companies to penetrate Myanmar’s financial market. Both financial institutions and fintech companies should utilize solutions to expand not only financial inclusion but also education since only 31% of the adult population are financially literate. Banking agents, for example, can be deployed in rural areas as they can also be a source of information to the people living there.

BanqIn’s Presence in Myanmar

BanqIn (A Product of Bank-Genie) has already been deployed in Myanmar via the Aung Naing Toe Microfinance Co-operative Society. Because of BanqIn’s instant all-in-one financial inclusion platform, the microfinance cooperative continues to operate despite the stops that the COVID-19 pandemic has brought. BanqIn transformed Aung Naing Toe’s paperless processes to digital, which will enable them to grow and expand.

Aside from the Aung Naing Toe Microfinance Co-operative Society’s, BanqIn recently partnered with the Credit Union Foundation Australia (Cufa) to bring digital financial solutions to credit unions in Myanmar. BanqIn is being implemented in 23 credit unions under Cufa — spanning 3,000-4,000 customers that will eventually grow due to the digital banking modules supported by BanqIn.

Through the implementation of BanqIn among microfinance institutions and credit unions, more low-income people will benefit because the digital transformation easily enables institutions to expand and serve more. For banking to thrive in Myanmar’s unbanked and underserved population and areas, only the best communication and digital technologies should be used.

Bank-Genie’s BanqIn can provide the innovation needed to offer microfinance institutions, credit unions, and rural and thrift banks the solution to expand. Through expansion, financial inclusion can further thrive among those who need it most.

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