Financial technology companies (Fintechs) operating in Uganda have been urged to harness the power of emerging technologies such as Artificial Intelligence (AI) and blockchain to enhance financial inclusion.
The Deputy Director of the Department of National Payment Systems at Bank of Uganda (BoU), Mr James Ivan Ssentimba, said while Fintechs have already demonstrated their capacity to promote financial inclusion by enabling micro, small, and medium enterprises (MSMEs) access to several services, more needs to be done.
According to the FinScope Uganda survey of 2023, financial inclusion stood at 81 percent compared to 77 percent in 2018. So we see increasingly people accessing financial services. But this increase in financial inclusion was largely driven by the uptake of mobile money services, he said.
Enhancing Financial Inclusion through Fintech
Fintech’s Role in Promoting Financial Inclusion
By leveraging these technologies, MSMEs can improve access to credit, enhance operational efficiencies, and ultimately contribute more significantly to Uganda’s economic growth and development. So as Fintechs, you have a very, very big role to play, given the huge credit gap that exists between what MSMEs need as financial services and what they do receive from traditional banking services, he added.
Fintech and Blockchain Technology
The benefits include enhanced efficiency and productivity. FinTech solutions enable SMEs to automate repetitive tasks, streamline costs, and complex processes, and make data-driven decisions to optimise their financial strategies, freeing up valuable time and resources for you to focus on your core business activities, Ms Lukandwa said.
Conclusion
Financial inclusion is crucial for the growth and development of any economy. Fintechs have a vital role to play in enhancing financial inclusion by leveraging emerging technologies such as AI and blockchain. By adopting these technologies, MSMEs can improve access to credit, enhance operational efficiencies, and ultimately contribute more significantly to Uganda’s economic growth and development.
FAQs
Q: What is financial inclusion?
A: Financial inclusion refers to the access and use of a range of financial services and products by all individuals and businesses, including the poor and vulnerable.
Q: What role do Fintechs play in promoting financial inclusion?
A: Fintechs have the potential to promote financial inclusion by providing accessible and affordable financial services to underserved populations, including MSMEs.
Q: What are some of the benefits of using Fintech solutions?
A: Fintech solutions can automate repetitive tasks, streamline costs, and complex processes, and make data-driven decisions to optimise financial strategies, freeing up valuable time and resources for core business activities.
Q: How can Fintechs and MSMEs collaborate to promote financial inclusion?
A: Fintechs and MSMEs can collaborate to develop cutting-edge solutions that address the specific needs of MSMEs, enabling them to access credit, enhance operational efficiencies, and contribute more significantly to the economy.
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