An estimated two billion people do not have a bank account. This estimate is actually down from 2.5 billion, thanks to the profileration of smartphones and internet access.
While this is an improvement, having a bank account does not mean access to capital to start a business. If we believe that financial inclusion is key to reducing poverty, then it must also consider an entire suite of services and not just a digital store of money.
This may sound like an expensive endeavour, and it is something that ITMF has pinned several years down in the roadmap. So why is it important to talk about it now?
The Battle For India Between Facebook and Google
Part one of the answer lies between the ongoing fight for marketshare between the fierce battle between Facebook and Google to digitally "colonize" India. The two internet giants look towards India for further growth of their advertising business. In 2014, only 279 million people in India had access to the internet. As of 2018, there are more than 500 million internet users.
This exponential growth means gaining the marketshare to new users who are logging in for the first time is crucially important for Facebook and Google that they would try to give free internet just to get a headstart.
Facebook and Google recognizes the power of ubiquity. By being first in the game, it makes it harder for competitors as they would be more familar to the first-mover.
Ubiquity is the keyword
Cryptocurrency has a problem of familiarity. Functionally it works the same as any other fiat currency, you use it to send, receive and pay. But we are still using fiat currency because we are used to the banking procedures that use fiat currency. We know how traditional banking works and we trust it (to varying degrees).
Cryptocurrency will continue to face an uphill battle with adoption because of this tradition with the way we manage our finance. But for the estimateed 2 billion unbanked and underbanked people of the world, it isn't tradition for them. Cryptocurrency could be their first or most effective way to manage finance digitally.
Even banks are able to reach them, they are more likely to offer limited banking activities and may or may not allow or approve loans that may go towards building small operations like a convenience store or a delivery business. This is where ITMF's social lending platform would be able to provide a large diverse group of investors who may be more willing to provide the loan required as opposed to a bank.
We understand the power of ubiquity and if we are able to tap in this otherwise untapped demographic and improve their lives considerably. It also helps that with the strides that Facebook and Google are making and will continue to make over the next half decade, ITMF must seek to leverage this first-mover advantage as India is logging in for the first time and instead of learn what is internet banking, learn crypto banking instead.