How FinTech Will Solve Income Inequality
We know income inequality is not good. It damages people’s lives and hurts the economy. History is full of rebellion against it, whether by attempting to overthrow the monarchy or throwing tea overboard. Sadly this evil has yet to be defeated. In fact, it has only grown. It’s also been self-perpetuating, as the money has stayed in the same classes and the lower social rungs have had a near impossible battle to improve their situation. They can try, but big banking is rigged to favor the upper classes.
The good news? A revolution is here and FinTech is set to wage war on income inequality. Tune in this week as we explore the three ways FinTech will defeat income inequality.
The first way to defeat income inequality is to bring financial services to the sizeable portion of the world that was and is overlooked by big banking. Prior to FinTech billions of people around the world were seen as not viable customers by the monoliths and had to cobble out financial services from secondary and questionable providers that have exploited their poverty and need…if they could get anything. Thanks to mobile banking services offered by FinTech, these underserved people finally have a secure place to store their money, letting them properly manage it and accumulate interest.
Establishing a successful business is a great way to ensure economic stability and when seeking to start a business FinTech can be a lifesaver. Take Kabbage for example. This company aims to make accessing funding for small businesses a much easier process, offering an app for quick funding. Then, once the loan has been received, Kabbage’s system offers easy repayment plans like autopay and consolidated payments, reducing the amount of stress and worry entrepreneurs need to shoulder. By remaking the loan process, FinTech is opening up the business world to people previously shut out of it.
FinTech offers options for those who choose to use savings to fund a startup. The FinTech system allows users to slowly and automatically moving small amounts of money over, letting aspiring entrepreneurs build a nest egg in manageable increments and set up deposit systems. By providing a better way for entrepreneurs to save for their businesses (and lowering the need for credit), FinTech is feeding a healthier economy. Now imagine what this will mean when basic income is introduced. Social justice entrepreneurs—regardless of their financial background—will more easily be able to build a nest egg to fund their startups, helping to remake the financial marketplace and further reduce income inequality.
A lack of financial access is a major issue that can see people trapped in a financial hole, unable to fulfill their entrepreneurial dreams. When combined with a financial system rigged to benefit the elite, it can be an epic battle with little hope for those wanting a way out. The good news is that FinTech and innovative entrepreneurs are ready to attack the problem at its source and help people get access to the funding they need to become active contributors to the economy. By evening out the playing field, FinTech has the amazing and unique opportunity to repair or reduce income inequality, a reality we should all want to see come to life.