How FINCA is Leveraging Fintech Innovation for Financial Inclusion

Facebook’s motto “move fast and break things” is now the guiding light for much of the finance industry. Fintech innovation is smashing many of the traditional barriers to financial inclusion—such as geographical distance and the high cost of physical infrastructure.

The staggering success of digital finance featured heavily in the World Bank’s Global Findex 2017 report, which found that 515 million adults have become financially included since 2014. Mobile and internet banking have been crucial drivers of that growth, especially in Sub-Saharan Africa. Reads the report:

“The power of financial technology to expand access to and use of accounts is demonstrated most persuasively in Sub-Saharan Africa, where 21 percent of adults now have a mobile money account—nearly twice the share in 2014 and easily the highest of any region in the world.”

However, in the responsible finance sector, innovation doesn’t always translate into financial inclusion. For every opportunity made possible by innovative financial products and services, a new challenge pops up—especially in areas like data privacy, financial education, responsible lending, intellectual property protection and regulation.

Intentional action is needed to ensure clients are always protected and innovation is harnessed to put real financial power in the hands of low-income entrepreneurs and communities.

Navigating this new territory isn’t easy, but FINCA Impact Finance is devoted to delivering innovative financial products and services that protect clients and ensure value for investors and partners.

Digital Field Automation, Agent Banking and Mobile Money

This March, FINCA held its annual Global Management Meeting in Tanzania, home to one of its 20 subsidiaries and ground zero for some of the network’s most ambitious efforts at financial inclusion. FINCA Microfinance Bank Tanzania recently launched HaloYako, a first-of-its-kind mobile savings product.

HaloYako, which is accessible via feature phone, allows FINCA clients to manage their savings accounts on the go. More than 100,000 people used the service in the first six months. By using Fintech innovation to meet clients where they are, HaloYako represents a breakthrough for financial inclusion in Africa.

Also in Tanzania, FINCA is using tablet banking, biometrics and a massive network of banking agents to reach more people with responsible financial services. This “hybrid model”—which emphasizes digital services while maintaining personal relationships with clients—saves people the trouble of traveling to a brick-and-mortar branch. That’s especially important in a country where 68% of the population lives in rural areas. What’s more, these innovations boost FINCA’s productivity by allowing loan officers to reach more clients in shorter time intervals.

FINCA Microfinance Bank Tanzania staff member and banking agent. Photo by Lucy Mui.

FINCA Impact Finance is implementing similar digital field automation efforts across the network: in Kosovo and Nicaragua, it’s using tablets to disburse loans to rural clients.

Last year, FINCA’s subsidiary in Pakistan launched SimSim, the country’s first free mobile wallet. So far, SimSim has attracted more than 117,000 users and enabled $42 million worth of financial transactions.

In Pakistan—a country of 194 million people but 90% of whom are financially excluded—FINCA unlocked a massive market by using Fintech innovation to ease day-to-day activities like transferring money. In the process, it has dramatically expanded financial inclusion.

Navigating the Responsible Digital Finance Landscape

Through Fintech innovation, a customer-centric mindset and an emphasis on collaboration, FINCA Impact Finance is leading the charge to make global financial inclusion a reality.

Biometrics is just one example of how data analytics and technology make banking easier and more efficient. Tablets and mobile wallets are helping the company digitize its processes to reach more clients.

FINCA Microfinance Bank Tanzania client and staff using biometric-enabled tablets. Photo by Lucy Mui.

However, tech innovation alone can’t build a truly responsible and impactful financial ecosystem. To make a meaningful difference, action must be intentional. That’s why FINCA Impact Finance is forming strategic partnerships and collaborating closely with national regulators. FINCA Impact Finance is using Fintech innovation to break down barriers to financial inclusion—at the same time, it’s ensuring those technologies deliver impactful and responsible financial services to empower entrepreneurs and communities across the globe.