How open banking can enable financial inclusion
Financial inclusion is a concept that ensures that all households, Banking, and businesses, regardless of their income level, have access to the right financial services they need, and use them effectively to improve their livelihoods. The Open Banking initiative, on the other hand, guarantees customers a secure, flexible and rich customer experience. Both initiatives should benefit “THE CUSTOMER” so that they do not allow to work together and have access to many benefits.
Problems faced by individuals/businesses in rural/remote areas
1. Access to banks and banks is difficult and expensive
2. Although individuals have a bank account, they are not active or inactive because managing the bank account is like traveling to a distant city.
3.lack of financial training
4. High-interest rates for companies that need loans
5. Lack of transparency leads brokers/traders to mislead individuals and businesses
6. Lack of good banking services limits your ability to work with urban clients.
Can public banks help solve problems?
Let’s choose each case and see if Open Banking can solve these problems.
• Access banks and avoid SLEEP status
Fintech, banking technology, and government initiatives help people to open a bank account using technology. Now that banks are equipped with digital channels, bank agents or bank agents can open a bank account. These people are confirmed by the respective banks as intermediaries between the bank and the customer. With the digitization and availability of the smartphone, banking applications are installed on the phone and all services used by the customer have a record that makes the process transparent. Open Banking helps users access bank accounts by authorizing third-party applications, paying bills, transferring funds, and retaining the COMPUTER.
• Access to financial training
Thanks to innovative fintech models and an open API that lets you download an app to your phone, connect it to your bank account and learn more about different terminologies. What is a savings account? How important are interest rates? How are interest rates calculated? etc. Everything was accessible in their native language, again thanks to the open API and open data.
• Interest rates are offered according to the regulatory orders
If an individual applies for a personal bank loan with a single scan, the interest rates are offered as approved by the country’s regulatory body. In cases where multiple banks are served, can they use a third-party application that uses the open API model to compare which banking/fintech businesses offer the lowest interest rates?
• Access to growth and opportunities
Jonathan’s example would be the best here, because, with the implementation of the Open API module and the Open Banking concept applied, Jonathan could now reach more urban customers without leaving his hometown.
Teknospire allows financial inclusion in Open Banking
The growth of Teknospire has been structured and each module has been developed according to plan and digitized one by one. With an open API design, the payment automation platform designed for Zimbabwean civil servants can seamlessly integrate with government payroll and corporate ERPs. The next step was to provide a platform that could help the customer pay bills, download, and transfer funds, and the micropayment platform for invoicing was born.
The next module was to assist individual entrepreneurs or banking intermediaries, and we launched an agency and payment module for individuals to access the digital platform and assist in the final phase of the banking sector.
With a stable ecosystem, a rich customer base, and a proven platform, the small cooperating banks have seen an advantage in expanding their reach. With a thin layer of banking or banking agent solutions as a new addition to our offering. Banks trust us as technology providers and start our work where they find solutions such as commercial banking, agent banking, automated reconciliation, and micropayments.
The splendor of all these modules is the independent operation made possible by the Open API architecture. Banks, NBFCs, or microfinance companies can apply for all modules, from a package or module of their choice. With its open API, it helps companies integrate seamlessly with their systems.