The Asian Development Bank has declared emerging digital technologies as the greatest opportunity to bring about financial inclusion across the developing world.
The comments came at the 3rd Asia Finance Forum from ADB’s Vice President of Knowledge Management and Sustainable Development, Bambang Susantono – who listed distributed ledger technology, regulatory sandboxes and digital ID as pivotal tools in the quest to bank the unbanked.
The 3rd Asia Finance Forum: The Future of Inclusive Finance in Manila has explored how the 1.7 billion people living outside the formal banking and financial system, can be empowered through technologies, such as artificial intelligence, big data, blockchain, mobile payments and digital banking.
Bambang Susantono, a former Indonesian Deputy Minister for Infrastructure and Regional Development, has been an ongoing advocate for digital technologies’ potential to empower the financially disenfranchised.
“Mobile apps have vastly improved people’s daily lives and are transforming entire economies,” he has stated.
“The application of digital and online technologies can be massive and has the potential to help emerging economies leapfrog development.
“Developing countries in Asia stand to benefit immensely from this new era.”
The ADB says despite the Asia and the Pacific’s recent advancements, the region remains home to a large share of the world’s poor – 330 million living on less than $1.90 a day and 1.24 billion on less than $3.20 a day.
New initiatives
ADB’s Regional Director, Lotte Schou-Zibell, says the forum enables key players across the development and private sectors to explore innovative projects to tackle the access-to-finance gap.
“Remittances play a large role in the economies of many developing countries, but costs of transferring these funds are high, reducing their benefit,” she has stated.
Schou-Zibell highlighted UnionBank of the Philippines’, i2i platform as one key project aiming to address the issue.
The initiative has received clearance and support from the nation’s central bank to operate as the country’s first private Ethereum blockchain-based payment network for domestic remittances.
“Project i2i’s network has expanded from six financial institutions in 2018 to 31 and it has facilitated over 575 transactions amounting to nearly 80 million Philippine pesos,” she has stated.
“The savings achieved on a single domestic remittance has been the equivalent to a week’s worth of food for some unbanked families.”