Millions of underbanked people around the world are finally
getting access to financial products such as savings accounts, investing and
loans.
They have technology to thank.
“There’s this new type of excitement about putting your
money to work for you,” Flori Marquez, the founder and senior vice president of
BlockFi, a cryptocurrency trading platform, told CNBC’s Kate Rooney during
Thursday’s Equity and Opportunity Forum. “And we’re seeing demographics who
historically haven’t been active investors enter this space for the first time
by purchasing assets like crypto.
Cryptocurrency bulls have long pointed to the accessibility
of the asset class, and some even say that investing in the digital coins could
help close the racial wealth gap in the U.S.
“For the first time in history we have a plan B option to
the current financial system which has seen years of redlining, racial
discrimination and other egregious acts by retail banks to the Black
community,” Isaiah Jackson, co-host of
‘The Gentlemen of Crypto’ podcast and bitcoin expert, and author of ‘Bitcoin
and Black America,’ said in a January interview with CNBC’s ‘Squawk
Alley.’
Marquez said cryptocurrency has been a boon to people
affected by the war in Ukraine, as the coins can easily travel and be accessed
anywhere.
“You can take your financial assets with you wherever you
are,” she said, adding that BlockFi is also making U.S. financial products
available to people overseas. “I think it makes a huge difference for Ukrainian
clients today.”
Access to loans
Beyond investing in cryptocurrency, technology is helping
people save and qualify for loans just by having a phone.
“There are 2.5 billion individuals around the world
currently lacking access to traditional financial products,” said Shivani
Siroya, the CEO and founder of Tala, a financial technology company with a
focus on emerging markets.
That includes “the ability to save their money securely, to
be able to earn yield on that, to be able to make simple payments that are
essential to their daily lives, and to be able to grow their financial
stability over time.”
Financial institutions are starting to use non-traditional
data to give consumers credit ratings, which can help them qualify for loans
even if they don’t have a formal relationship with a bank or have established
credit.
“We are able to use alternative data to understand where
they are in their lives and then be able to provide them with access to the
liquidity they need to move towards opportunity,” Siroya said.
This is also a trend seen in the U.S. as some companies now
allow consumers to use payments for housing, subscription services and more to
improve their credit scores, boosting access to loans.
Click here for the
original article.