How can fintechs help improve financial well-being? With Mastercard, Coinweb, DailyPay and more

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this august in The times of financial technology, we seek to highlight some of the amazing things that fintechs are doing around the world. We always hear about the “latest groundbreaking innovation that benefits the community,” but do these innovations benefit those already in a privileged position, or help make the financial world more accessible?

There are many different facets to the concept of ‘fintech for good’, one of the main benefits being greater financial well-being for consumers. We spoke to several companies in the industry to find out more.

financial equity

Opening our conversation Jeannie Waldendirector of innovation and marketing DailyPayexplains how financial equity is achieved through the applied use of fintech within the workforce.

“Diversity, equity and inclusion are at the forefront of many business leaders’ minds as they strive to create work environments where everyone feels welcome. However, financial fairness is an aspect that is often overlooked. Financial equity and inclusion mean ensuring that people have equal access to career opportunities, financial systems, products and services, and ultimately wealth. At DailyPay, we help… businesses improve the financial equity of their workforce by offering on-demand payments to their employees.

“With pay-on-demand, employers are providing a much-needed lifeline and cash flow to their employees who are often unbanked or underbanked. DailyPay’s technology platform allows employees to transfer their earned pay to any bank account, debit card or payment card with the push of a button.

“Using DailyPay can help employees save an average of $1,205 per year in reduced loan fees, overdraft fees, and late fees. Research made by him Aite-Novarica Group shows that 95 percent of those who previously relied on payday loans in some way stopped using payday loans or reduced usage after using DailyPay. Additionally, 97 percent of those who said they had overdrawn their bank account before using DailyPay now rarely or never incur overdraft fees after using DailyPay.

“This helps users improve their credit, build savings and feel more capable and financially independent by reducing the need to rely on payday loans, payday loans or personal loans from family and friends. The mission-driven innovation that created DailyPay is an integral part of how we improve people’s lives every day.”

financial understanding
Jean-Louis Warnholz

“Fintech can help improve people’s financial well-being in many ways, for example by increasing people’s understanding of the financial world,” he says. Jean-Louis WarnholzCEO and co-founder of Future.

He said: “Only 57 percent of adults in the United States are financially educated, according to a survey by the Milken Institute. Fintech has a role to play in creating greater awareness of the impact our daily choices have, not only on our current life, but also on our future and the future of generations to come.

“At Future, we focus on the intersection of financial and environmental sustainability, providing our members with options that are good for the planet and good for your wallet. More effective and less carbon often go hand in hand.”

Information on money management

colby thameschief technology officer certaintypoints out the relationship between the information provided by fintech tools and the financial health of the underserved.

“Fintechs can provide access to consumer data and analytics in new and innovative ways that can help us understand consumer motivations and trends. They are also helping to open financial and money management channels for the unbanked and underbanked, helping to move more consumers into more secure financial management positions,” explains Thames.

It continues: “The tools that fintech can provide, such as personal budgeting, automated savings, spending analysis, and an aggregated view of finances, give consumers more information and choice than ever before, allowing them to manage and optimize better your financial health.

“Many fintechs provide a broader set of payment options for consumers compared to their traditional banks, allowing them flexibility in how they pay for things. Additionally, many fintechs also offer more security and fraud protection, giving consumers more peace of mind.”

open banking
David Jones, Head of Fintech, UK & Ireland, at Mastercard
david jones

david joneshead of fintech at MasterCard United Kingdom and Ireland, sees the application of open banking as an enabler of financial well-being.

“Financial well-being is fundamentally important to society,” shares Jones. “To drive prosperity, people must be financially engaged and confident. But financial well-being cannot be possible without financial inclusion: the availability and equality of opportunity to access financial services.

“Sadly, however, around 7.1 million people in the UK, or 14 per cent of the adult population, currently fall under the definition of ‘financial exclusion’, meaning they might find it difficult to access affordable and fair financial services. With people excluded from the financial system in this way, there is no hope of achieving financial well-being. And in the current cost of living crisis, this is critical for millions of people across the country.

“Every person, regardless of their origin, has the right to accessible, high-quality, reliable and safe financial services and products. Fintech and others New and emerging technologies have an important role to play in tailoring products and services to meet the needs of underserved groups.

“In the case of open banking Fintechs can create personalized services for specific groups of underserved people, increasing rates of financial well-being in the general population. Open banking data can provide fintechs with insights into people’s financial data, including spending information. This means that these organizations can create personalized financial products that best suit an individual.

“Lenders, for example, are increasingly recognizing the value of open banking in addition to traditional credit data when assessing a person’s affordability. In fact, 70 percent of lenders are expected to adopt open banking technology by 2023. It is these personalized services, enabled by open banking, that can help people manage their money and not spiral into debt. , which ultimately drives financial well-being, particularly during cost-of-living crises.”

Active participation
Sarah Biller, Co-Founder of the FinTech Sandbox and Leader of the Mass Fintech Hub
sarah biller

sarah billerco-founder of Fintech sandbox and leader in massive fintech hub, describes how the broader adoption of fintech has enabled more people than ever to engage with financial services; which has finally improved their way of life.

“Fintech has brought innovation to financial systems since cuneiform tablets and biblical times,” says Biller. “Its power is to expand financial access to more people through new technologies that can make trading and accounting more efficient. We see financial technology as critical to providing financial availability and access so that people can find agency and ultimately take control of their financial lives.

“Fintech provides access to ensure that anyone can actively participate in the financial system, by creating affordable and accessible financial products and services that engage all communities. It also offers more inclusion by providing creative solutions that mitigate unequal access, increase affordability and improve quality. The result of inclusion is that communities become safer, more resilient and more sustainable, which is the foundation of a sound financial system.

“People need to be able to access technology. It must be available affordably, at scale, and to all the communities and people who can benefit from it. Financial access is also irrelevant if there is no sustainable land to live on and ESG reporting is the function that compels companies to finally act and take responsibility.

“Fintech also requires access to data and collaboration across the ecosystem to provide access and agency. Innovation hubs provide opportunities to build ecosystems and foster innovation among emerging fintech companies that benefit the financial system and communities.”

A wave of innovation
Toby Gilbert, CEO and co-founder of Coinweb
toby gilbert

At the end of our conversation, toby gilbertCEO and co-founder of Coinwebprovides an overview of how decades of fintech evolution and innovation are driving the realization of a better connected world.

“Fintech has actually been around for more than 20 years. One could argue that PayPal It was and is fintech, but in the late 1990s, the industry was called ‘payments’. Regardless of the glossary, the goal is to use technology to advance the existing financial system, which is archaic at best. But as much of a dinosaur as he is, he is a powerful one with considerable personal interests at stake, intertwined with politics in what could be considered an unhealthy relationship. Therefore, any move to disrupt these cozy relationships is met with stiff resistance, as PayPal did in 2000.”

Gilbert continues: “But as payment platforms transformed the way digital wallet payments were made, micropayments that took advantage of telecommunications networks in Africa allowed companies like M-Pesa to make instant miniature transfers between retail users, literally changing the landscape overnight. Leaving aside the fact that this acted as a catalyst allowing small businesses to start operations that were previously logistically impossible, it also solved problems in many important areas such as hunger and education by introducing liquidity into the market.

“The second bounce of the ball today is payments powered by blockchain technology, which promises to automate processes that are unnecessarily slow, such as the Swift network. In today’s age, to think that an international transfer could or should involve some sort of manual process is insane and the fact that it could take up to two or three days to process is insane. That is unless you have some type of vested interest to preserve the principal for a little while longer!

“For this to happen, the institution’s backsliding on the blockchain needs to be overcome when we expect them to adopt the technology, at which point the world will experience the next wave of fintech that will benefit it.”

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