Going the Distance to Achieve Financial Inclusion
There are many barriers to financial inclusion that differ from one country to another. Reasons range from environmental factors to internal ones based on social standing or salary. However, one of the most common barriers is geographical distance — especially for countries that have more rural areas than urban areas due to a lack of infrastructure.
A person living in rural areas have a much lower chance of accessing certain goods and services. For them to access these, they sometimes have to travel long distances, which is an added cost to their household. One of the basic services that can be hard to access for people living in rural areas is financial services. This is because some banks prefer to operate within a physical branch, disabling those who live away from these branches. Because of this, the majority of the unbanked and underbanked population live in rural areas. It is a must, then, to reduce the barriers to distance so more people become financially included.
One of the solutions that financial institutions should adopt is branchless banking.
Branchless banking is the delivery of financial services outside the usual brick-and-mortar bank set up using communication and information technologies. By digitizing banking processes, banks and clients need not rely on physical branches for transactions.
Another solution that falls under the branchless banking category is agency banking. Agency banking is the delivery of financial services through banking agents that use Point-of-Sale terminals or mobile phones. These agents are deployed by banks all over the country to ensure that clients have multiple touchpoints. These agents can also go to the customers themselves, instead of simply setting up shop in an area.
For microfinance institutions that want an all-in-one solution, BanqIn (A Product of Bank-Genie) is a financial inclusion platform that is cost-efficient, accessible, and comprehensive. It is an all-in-one digital banking platform that enables self-service and agency banking, even with just a 2G connection — ensuring those living in rural areas can be financially included.