Filling the gaps in financial inclusion for immigrant and refugee communities: startups

Entrepreneurs are stepping up to the plate to help tackle some of the world’s most difficult issues and bridge the access gap for some of the most vulnerable groups to financial services.

There are more than 59 million internally displaced people and 281 million estimated foreign migrants worldwide.

The fact that many countries’ current financial services do not satisfy migrants’ demands is one of the many difficulties they encounter. Numerous migrants are still unbanked, remittance costs are still exorbitant, and inadequate regulation prevents millions of migrants from getting the financial support they require.

Fintech start-ups focusing on providing improved financial services for migrants and other neglected customers have emerged in recent years, which is a blessing. We take a moment to highlight companies that are trying to enhance migrant and refugee access to finance as we commemorate World Refugee Day.

• Earth’s gravity: Gravity, a company with offices in France and Kenya, makes use of blockchain technology to provide everyone the ability to build a self-sovereign, data-based digital ID and have access to financial services that were previously inaccessible. Users of Gravity can securely exchange their personal information to gain access to government, financial, employment, and humanitarian services. Verifiable data can also be easily gathered by organisations to enhance impact, interoperability, and service delivery. The goal of the startup is to provide human-centered digital ID solutions that will make data sharing simple, transparent, and secure for everyone, no matter where they are in the globe. They started the DIGID Project in 2021 to assist the Kenya Red Cross Society in distributing aid to disadvantaged Kenyans who lack identification cards across the nation. Even beneficiaries with limited to no access to or knowledge of technology can develop digital identities to receive aid programmes according to the project, which aimed to close the technology gap between beneficiaries and users.

Fintech startup Kodo raises $8.75M from Brex, Y-Combinator…

Leaf Global Fintech’s predecessor, Boss Money: Boss Money is a virtual banking service that offers a dependable and practical way for migrants and refugees to manage their remittances while travelling and to have friends and family members contribute to the Leaf accounts. With the help of Leaf’s banking services, customers may keep money in many currencies, access it from anywhere in the world, and use both smart and non-smart phones to send money abroad at a reasonable rate, buy goods and services, and convert currencies. The startup uses low-cost blockchain technology to safeguard consumers’ savings. The start-up was bought out by IDT Corporation in 2022. Over the years, it has also received awards from the UNICEF Innovation Fund, IBM HyperProtect Accelerator, and Fast Company as the winner of the developing world technology category in the 2021 World Changing Ideas Awards. 

• Monak e-Services is a migrant fintech startup based in the United Arab Emirates that uses affiliated networks to offer financial inclusion and life services to migrants and underprivileged areas. The start-up, which recently joined Village Capital’s Financial Inclusion for Migrants programme, has an all-inclusive mobile application that offers a wide range of services, including convenient banking services like opening a local bank account, getting a debit card in home and work countries for workers and their families, money remittances, and foreign exchange transactions. Additionally, it enables access to critical services like groceries and food delivery, taxi booking, and bill payments, as well as healthcare and insurance services (medical visa, health packages, online pharmacy, and life, medical, motor, etc. insurance). 

• Pipit Global: Located in Ireland, Pipit Global is a platform for digital and physical currency transactions created to serve migrants in Europe who are sending money to developing nations. Pipit, a for-profit social impact firm, is dedicated to making it simple for migrants to conduct business locally and internationally without the use of a credit card or bank account. When compared to traditional international payment providers, migrants who live and work abroad can pay their bills and send money abroad for a small fraction of the cost and time. In order to power low-cost remittances across Africa in 2021, Pipit teamed up with Cellulant. As a result, Africans living abroad may now top up their eWallets, transfer funds to a bank account, pay their bills, and even make online purchases for family and friends back home.

More than just refugees and migrants benefit from financial inclusion. Through greater tax collection and trade, it promotes economic growth.

The Positive Economic Contributions of Refugees in Türkiye report, published in 2022 by Building Markets, demonstrated that small businesses run by refugees had a significant and positive impact on job creation and improved living conditions, not only for themselves but also for their Turkish neighbours.

3.6 million (90%) of Turkey’s four million refugees and asylum applicants are Syrian. Syrians have incorporated themselves more fully into economic life over the past ten years as customers, job seekers, workers, and business owners. According to the report, Syrians are expected to have spent more than $500 million in the country by 2020 via the establishment of economic ventures. 

Entrepreneurs are stepping up to the plate to help tackle some of the world’s most difficult issues and bridge the access gap for some of the most vulnerable groups to financial services. Similar to this, the impact ecosystem has to pay attention and focus its investment on this underserved market.

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