How FinTech can benefit underserved groups achieve economic inclusion

By Puja Sharma

The Electronic Transactions Association (ETA), the trade association for the payments technology industry, released its annual white paper outlining a variety of financial technology products and services that have broadened access to the payments and financial services ecosystems. The report, Advancing Economic Inclusion—Empowering Underserved Communities with Fintech, highlights the innovative products and services revolutionizing the way commerce is conducted through safe, secure, convenient, and rewarding solutions.

“As detailed in our white paper, ETA members are delivering financial services to where consumers are headed,” said Jodie Kelley, CEO of ETA. “This results in a suite of products and services being available to serve all consumers, especially the underserved.”

Digital payments is one of the most innovative and progressive industries, offering a sophisticated and interconnected infrastructure that delivers financial products and services that benefit consumers, businesses, and the American economy.

These offerings are safe, and secure, and promote financial inclusion for consumers, including those who have traditionally lacked full access to the financial system to conduct everyday financial transactions.

In recent years, financial institutions (FIs) and FinTech companies have transformed the financial landscape, introducing cutting-edge technologies that broaden consumer access to new financial solutions at reduced costs. The COVID-19 pandemic has spurred further technological breakthroughs in the past two years, enabling traditionally underserved consumers to enhance their financial management, transactions, and stability.

This report by the Electronic Transactions Association (ETA) showcases how its members are creating new opportunities for underserved populations and addressing their changing financial needs. Building on its 2016 publication, the report highlights recent product and service introductions, including COVID-19 Pandemic Economic Relief was powered by the payments industry. The electronic payments industry facilitated billions of dollars in benefits across multiple technology platforms quickly and securely, allowing individuals and small businesses to receive much-needed assistance.

The paper highlights advancements in payments technology that are making services more available, accessible, and, affordable than ever before,

Open Finance

Open finance an extension of Open Banking, enbles consumers and businesses to securely share their financial data with accredited third parties, allowing for improved access to financial services.

Prepaid products

Prepaid products provide cost-effective, convenient, and innovative payment options for millions of consumers, including those with limited or no access to traditional financial accounts.

Non traditional payments

Nontraditional payments options are becoming increasingly popular as they allow consumers to cash checks conveniently, move funds between individuals easily, and pay for goods and services affordably, without needing an account with a traditional financial institution.

Mobile Banking services & Innovation in ADA compliance
Mobile banking services & innovations in ADA Compliance services provide financial independence and security to demographic groups that lack easy access to brick-and-mortar branches, such as consumers in rural areas, the elderly, and individuals with disabilities.

Mobile payment
Mobile payments are a convenient and secure alternative to cash and checks, allowing consumers to pay for goods and services securely and cost-effectively, while also facilitating greater financial literacy by enabling consumers to manage their accounts from their mobile devices.

Expanded internet excess
Expanded internet access provides affordable internet to underserved communities by improving infrastructure and reducing costs.

Online Small Business
Online lenders are expanding access to credit and providing small businesses with affordable loans using innovative technologies and sophisticated, data-driven underwriting to evaluate potential borrowers, reaching funding decisions swiftly and providing capital expeditiously.

P2P payment, and Cross-border payments
Peer-2-peer payments technology is altering the way individuals exchange money by enabling the secure, instantaneous transfer of funds through mobile applications. Cross border payments are transforming the global financial landscape by making international payments and remittances cheaper, quicker, and more accessible for consumers.

Interactive, automatic teller
Financial institutions are deploying a new generation of technology to transform traditional branches and make them more economically sustainable in underserved communities with branches that have smaller physical footprints but offer a broader range of services at more convenient hours.

Financial literacy
To educate and empower adults and school-age students about today’s modern financial products and services landscape, ETA members offer programs on how to manage finances and invest for the future.

“The speed, security, and, most of all, reliability are hallmarks of the payments industry that consumers and businesses have come to rely on when it comes to receiving, spending, sending, and holding money,” Kelley noted. “As the leading trade association for the digital transactions industry, ETA encourages policymakers to create a positive policy environment to support continued innovation and the use of technology to improve financial outcomes for all members of society.”