Financial inclusion in a digital world

There has been significant growth in financial inclusion driven by a booming fintech industry that has acted as a disruptor to traditional banking and transformed access to financial services


The fintech revolution is promoting financial inclusion and democratising access to global markets by providing users with cutting-edge trading tools. According to the World Bank, digital payments saw significant growth in 2020, particularly in emerging markets and developing economies, where the volume of transactions is growing at an impressive rate. Sub-Saharan Africa emerged as a leader in mobile money transactions, fuelled by non-bank entities like fintechs, brokers and more.

As users transition from basic phones to smartphones, app-based financial companies are replacing older interfaces, offering enhanced functionality, speed and convenience. This rapid expansion of digital finance is making global financial markets more accessible to individuals from diverse backgrounds, fostering financial inclusion and democratising opportunities for wealth creation.

However, this financial inclusion also brings with it certain risks and challenges, both for the financial system as a whole and for individual users. While easier and faster access as well as lower costs all benefit users, it is essential to address potential issues such as security, privacy and financial literacy. In this article, we will explore the advantages and challenges associated with the growth of financial inclusion driven by digital finance and examine ways of harnessing its potential while mitigating the risks involved.

Financial inclusion for a global economy
Traditionally, participating in global financial markets has been the exclusive privilege of institutional investors and high-net-worth individuals. However, advancements in technology have made it possible for the average person to access these markets, increasing financial inclusion and levelling the playing field.

The rise of digital currencies and blockchain technology has opened new doors for financial inclusion

In this new environment, the democratisation of financial services and education is crucial in fostering financial literacy and responsible investment practices. An OECD survey from 2020 reveals significant variations in financial competencies across economies and groups. Low levels of financial literacy and high financial stress highlight the importance of integrating educational elements into fintech services.

By developing comprehensive educational resources such as webinars, articles and video tutorials, fintech companies can help users build a strong foundation of financial knowledge, empowering them to make informed decisions and take control of their financial future. By making these resources accessible to a broader audience, fintech firms are helping to create a more financially inclusive and equitable global economy, allowing individuals from all backgrounds to seize the opportunities presented by global markets.

At Olymp Trade, we’re creating a platform that caters to both experienced traders and newcomers. Our research on users in South-East Asia and Latin America showed that a majority of them want to achieve additional income through trading. Even though most of these people estimate their income as average, trading expenses account for a significant portion of their budget.

A failure in trading can have dire consequences for such households, so they must be aware of the risks associated with being active in the financial markets. That’s why we believe it’s essential to maintain a robust educational resource centre while promoting risk management and mindful trading.

Even though there’s already a wealth of information online about common trading mistakes and position sizing, traders still suffer from reckless decision-making and overconfidence. That’s why trading platforms should engage users in financial education. We are constantly working on new innovations, such as trade analysers and in-app tips, so our users can more easily gain the knowledge required for trading safely. As a result, we ensure that as barriers to entering the financial market break down, people get guidance that helps them explore and use this new world to their advantage.

Harnessing the power of AI
The evolution of trading analysis has come a long way since the days when individuals relied on printed or hand-drawn charts to interpret market trends. As technology has advanced over the years, computer-based indicators have revolutionised the way traders analyse data, by streamlining the process and providing more accurate insights. Now, we have entered the era of artificial intelligence (AI), which is transforming the trading landscape once again. Harnessing the power of AI has the potential to optimise trading strategies, enhance decision-making and improve the overall efficiency of financial markets.

In today’s fast-paced financial landscape, access to real-time data and analysis is crucial for making informed trading decisions. Innovative platforms are already taking advantage of AI and machine learning to provide users with advanced analytical tools and insights that can help them stay ahead of market trends. For instance, AI-driven sentiment analysis evaluates news articles, social media posts and other data sources to gauge market sentiment and predict price movements.

Beyond delivering real-time market insights, AI is also revolutionising the way investors manage their portfolios. By leveraging AI-driven algorithms, fintech companies are offering users access to robo-advisory services and automated trading solutions.

These tools can evaluate large datasets, identify patterns, and develop tailored investment strategies based on an individual’s financial goals and risk tolerance. This level of personalisation and automation not only saves time and effort for users but also helps minimise the impact of emotional biases on trading decisions. As a result, investors can enjoy a more efficient and objective approach to navigating the complex and ever-changing financial markets.

By incorporating AI-powered features, companies like Olymp Trade ensure that users receive timely and relevant market analyses that can enhance the performance of their trading strategies. Additionally, these platforms offer customisable risk management tools, enabling traders to minimise potential losses while maximising their potential gains.

As AI technology advances, the boundaries of autonomy may widen, allowing for more sophisticated trading strategies. Along with these successes, however, come potential issues. For example, AI trading machines are trained on past data and may lack a broader perspective.

In addition, the algorithms may evolve so much that human developers can only partially understand them. Finally, regulatory challenges will undoubtedly arise as lawmakers step into uncharted territory. As a result, it is essential to recognise and respect the limitations of AI, ensuring that human oversight and understanding remain integral parts of the trading process.

Embracing digital currencies
Digital currencies and blockchain technology are benefiting individuals from all socioeconomic backgrounds, including those with limited financial resources, by providing access to essential financial services and opportunities. Faster, more affordable and accessible remittance services enabled by digital currencies are particularly important for low-income individuals relying on remittances from abroad.

Blockchain technology allows for the creation of decentralised finance platforms that remove intermediaries like banks and lower costs and barriers to entry. This democratisation of access enables people with limited resources to participate in saving, lending and borrowing programmes, which were previously restricted to those with traditional banking access. Digital currencies also offer financial privacy and autonomy, empowering individuals to manage their finances without third-party involvement, and providing an alternative store of value and means of exchange for those in countries with unstable financial systems or high inflation rates.

The rise of digital currencies and blockchain technology has opened new doors for financial inclusion, allowing people from all walks of life to participate in the global economy. Fintech companies are increasingly embracing these innovations, offering traders and investors access to a wide range of digital assets and decentralised financial services with lower financial barriers for entry.

We have entered the era of AI, which is transforming the trading landscape

They are staying ahead of the curve by continuously expanding their offerings to include popular digital currencies and incorporating blockchain technology into their infrastructure. As a result, users can diversify their portfolios and tap into the growing potential of this emerging market. With Olymp Trade, for example, it’s possible to make deposits and withdrawals in cryptocurrency as well as trade some of the most popular crypto assets.

Overall, it is essential to acknowledge the challenges that blockchain technology faces, such as scalability, energy consumption, security, complexity and interoperability. Addressing these problems is vital to ensuring that blockchain can fulfil its potential as a game-changing technology. By understanding and working towards resolving these issues, fintech companies can contribute to creating a more sustainable and efficient financial landscape for all users.

The future of financial inclusion
As fintech continues to revolutionise the financial industry, more and more people will have the opportunity to access and participate in global financial markets. Companies like Olymp Trade are setting the stage for a more inclusive and democratised financial ecosystem, paving the way for a brighter and more financially empowered future for individuals across the globe.

By embracing the latest innovations and focusing on user-centric services, fintech companies are transforming the world of finance, breaking down barriers, and giving more people the tools they need to create wealth and achieve financial freedom. It is important to note that there is still a significant way to go, as a considerable portion of the global population — 35.6 percent as of January 2023 — still lacks access to the Internet.

Addressing this digital divide is essential to ensuring that the benefits of fintech innovations can reach all individuals, regardless of their location or socioeconomic status. By working towards bridging this gap, fintech companies can play a crucial role in fostering financial inclusion and democratising opportunities for wealth creation worldwide.