Financial inclusion is a hot topic among payment facilitators and providers right now. This concept includes all the efforts from organizations in the finance field aimed at making their financial products available, accessible, and affordable for all people.
There are millions of people in the United States today who are struggling financially. A pandemic combined with rising inflation, housing, and gas prices has many of us feeling the strain. In fact, there are now reports that even individuals who make more than $100,000 per year are living paycheck to paycheck.
And more than half of US adults have credit scores below 680. This score is considered “sub-prime.”
In order to help our most financially vulnerable populations (people with low income, bad credit, and limited access to financial resources), we have to enact initiatives with the end goal being financial inclusion for all.
What role do payment systems play in supporting financial inclusion? Let’s talk about it.
Why We Need Financial Inclusion
An estimated 1.7 billion adults around the world do not have access to a basic bank account, according to Investopedia. The FDIC estimates that just over 7 million of those people reside in the United States.
Financial inclusion initiatives are striving to change these statistics. The World Bank illustrates financial inclusion like this: “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.”
Nearly all the areas mentioned above are directly related to a person or business’s ability to give and receive payments. So, naturally, payment systems have a large part to play in the success of financial inclusion initiatives.
The Role of Payment Systems in Financial Inclusion
Financial inclusion is often closely connected to omnichannel payment systems.
Payment facilitators are a lot like smartphones – they can create tons of solutions all from one platform. Just like you can call, text, listen to podcasts, take notes and photos, and even carry out financial and bank transactions on that magical square in your pocket now, so too can you create a multi-layered approach to payments with a quality payment platform like ReliaFund.
Many payment systems, like ReliaFund, are customizable and easily tailored to specific audiences and industries. Because of this, these systems are perfect tools in the fight to expand financial inclusion to even the most remote and disconnected areas of the country.
The rise of smartphones has changed how we experience the world, and mobile payments are no different. There are even many underbanked and unbanked individuals who use mobile payments to carry out their professional and personal transactions.
While newer, more expensive phones hit the market every year, there are still many pre-paid and disposable options available to those who, for whatever reasons, choose not to pick up the latest iPhone or Samsung product.
The accelerated adoption of real-time payments has also done wonders to bridge gaps between financially connected communities and those that are most in need of financial inclusion initiatives.
Instant payments are helping those individuals and businesses that may not have cash reserves to cover all the expenses incurred while they are waiting the several days it takes for many other bank-helmed payments to clear.
For example, if a small business puts in extra time and resources to fill a larger-than-normal customer order, they may be pinched for cash as they prepare the order and wait for the debit to appear on the buyer’s bank account and then the credit to be transferred into the seller’s business bank account.
During that time, other expenses or bills may be due. If you think a few days isn’t that long to wait, just try paying your employees 2 business days late and see how they feel about it.
The goal of payment systems in the financial inclusion plan is to give that necessary breathing room to those who otherwise may be struggling to live, run their businesses, and raise their families.
Payments Integration & Financial Inclusion with ReliaFund
Consolidating your payments into one platform is a great way to foster financial inclusion for the individuals and businesses you serve. ReliaFund has been committed to streamlining the payments pipeline for over twenty years.
Check out ReliaFund’s plethora of payment solutions today:
- ACH Processing: process checks and payments using just the bank routing and checking number.
- Payment Processing: Our Electronic Payment Services payment processing platform can help every organization, from small businesses to large enterprises, by streamlining payments across online and mobile using an end-to-end platform solution.
- Reports and Reconciliation: These are easy tools for reporting and reconciling ACH, credit card, and all electronic payments.
- Online Payments: Collect payments 24/7 with ReliaFund’s online payment integration.
- Payment Processing Software Integration: This allows you to integrate a payment gateway API into your website to accept all kinds of online payments. It’s even customizable.
- Virtual Terminal: This is a must-have in your business’s payment arsenal if you are a merchant that manually enters credit card sales, telephone orders, and electronic check details.