Why Am I Not Gonna Be Able to Enter a Bank?

by: Francisco Meré

Twitter: @Paco_Mere

“It is a long way and I waste so much time and money to be able to cash my paycheck. Once I arrive to a bank branch, an employee asks me what I need; I believe he is a bit hesitant to let me enter because of my clothes and indigenous appearance. I wait in line for 80 minutes to cash my check. I tuck the money in my clothes in case someone robs me. Because of the rain, it takes me much more time to return home. When I arrive, I light up a small fire to get warm and spread the bills to dry.” Juan, Mexican, 38 year-old man.

53% of the adult population in the world does not have access to formal savings or credit services. However, 50% of the global population has access to mobile phones; thus, it is the best choice to use this widespread and standardized technology for financial transactions. Mobile banking is cheaper than to invest in ATMs, bank branches, and postal services. Due to regulation and banking penetration, it is beneficial to rely on correspondents, simplified bank accounts, and “niche banks” to offer financial services to the underserved and unbanked.

Already, there are different options worldwide which have taken advantage of technology and the improvement of regulation to offer financial services with no need of visiting a bank branch or presenting any documentation to open a bank account.

In emerging markets, such as Mexico, there have been some advances in regulation and financial culture, for which there is one bank in Mexico that aims to change the paradigm of banking in the country by being the first fully digital bank. Mobile banking empowers people and shortens the gap between socioeconomic statuses. Mobile banking avoids discrimination by allowing every person to become part of the formal financial system.

Editors Notes: This entry has been submitted to the FINTECH Book, the world’s 1st globally crowd-sourced book on FINTECH. Readers that enjoyed this initial abstract are invited to share and like it so that it may be featured in a longer version.

The FINTECH Book is due to be released in April 2016 and is available for Pre-Order on Amazon.