The Banking Association of South Africa defines Financial Inclusion as the access and usage of a broad range of affordable, quality financial services and products, in a manner convenient to the financially excluded, unbanked and under-banked.
In simpler terms, Financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit, and insurance – delivered in a responsible and sustainable way.
World Bank research shows that an estimated 2 billion working-age adults globally—more than half of the total adult population—have no access to the types of formal financial services delivered by regulated financial institutions that wealthier people rely on. This means that, despite the growth of the financial sector, access to formal financial services still remains relatively limited; particularly, in rural areas where a significant proportion of services are delivered by informal providers, with limited linkages to the formal financial sector.
In these areas, people resort to less formal avenues such as liquid assets to save income and using moneylenders to borrow money – avenues which many times turn out costly and risky.
The technological advancement of mobile phones and the evolution of the services provided by telecom providers gave birth to mobile money – a solution to financial exclusion.
Powered by dfcu: How a Bank Overdraft, Grit, and Vision Lifted Dr. Richard Wemesa onto Uganda’s Best Farmers ListResearch done and published by finclusion.org in 2015 showed that 35% of Ugandans had a registered mobile money account and that mobile money was the predominant financial service in Uganda.
Currently over 8million Ugandans transact on the different mobile money platforms, a number expected to grow predominantly in the next few years.
In a chat with the Airtel managing director, V.G Somasekhar, he noted that “At Airtel, we believe mobile commerce is the next big thing and as such we have positioned Airtel money as the one stop shop for all our customer needs to ensure a boost in financial inclusion.
