NEOBANKS ROLE IN SUPPORTING FINANCIAL INCLUSION
Keywords:
Neobank, financial inclusion, traditional banks, financial services, financial literacy
Abstract
Financial inclusion has a significant impact on economic growth and development and improves the living standards of individuals in emerging economies. However, today, there are still individuals and businesses in developing and low-income economies that are unbanked or underserved with limited access to basic banking services. It must be noted that during the last two decades, many instruments, tools, and programs have been developed to support financial inclusion, which yielded positive results. However, the challenges and barriers remain to be further addressed and resolved to increase financial inclusion. The challenges originate on the supply side as well as the demand for financial services.
Neobanks, as technologically advanced financial institutions, are valuable instruments in overcoming key barriers to financial inclusion. The manner in which neobanks’ operations are structured enables them to easily adapt their products and serve even the smallest groups or segments with similar needs. Affordable financial services are also provided by neobanks as a result of their higher operational efficiency compared to traditional banks.
References
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Cámara, N. & Tuesta, D. (2015). Factors that matter for financial inclusion: evidence from Peru. AESTIMATIO, The IEB International Journal of Finance, 10: 10-31. DOI: 10.5605/IEB.10.1
Dharmesh, K.M., Sushant, M., Asmita, C., Dipen, P., & Subham Sushobhan, D. (2021). Factors Contributing to Financial Literacy and Financial Inclusion among Women in Indian SHGs. Universal Journal of Accounting and Finance, 9(4), 810 - 819. DOI: 10.13189/ujaf.2021.090427.
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Ganapathy, A. (2022). Credit Scoring Algorithms as Tools for Financial Inclusion: A Development Perspective. Intelligent Infrastructure, Series IT for Change.
Josyula, H.P. (2021). The role of fintech in shaping the future of banking services. The International Journal of Interdisciplinary Organizational Studies, Volume 16, Issue 1, pp. 187-201. ISSN: 2324-7649 (Print), ISSN: 2324-7657 (Online).
Kabakova, O. & Plaksenkov, E. (2018). Analysis of factors affecting financial inclusion: Ecosystem view. Journal of Business Research, Elsevier, vol. 89(C), pages 198-205.
Kaligis, N.V.B., Tewal, B., Maramis, J.B., & Mangantar, M. (2018). Financial Inclusion Profile: Determinant and Barriers. International Journal of Economics and Financial Issues, 8(5), 351-358. ISSN: 2146-4138
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Sarigul, H. (2020). The determining factors of financial inclusion in Turkey. Journal of Economics, Finance and Accounting (JEFA), V.7(3), p.223-235. DOI: http://doi.org/10.17261/Pressacademia.2020.1290
Shankar, S. (2013). Financial Inclusion in India: Do Microfinance Institutions Address Access Barriers? ACRN Journal of Entrepreneurship Perspectives, Vol. 2, Issue 1, p. 60-74. ISSN 2224-9729
Shanmugam, S. (2022). Digital transformation through fintech: an analytical study. Shodhsamhita: Journal of Fundamental & Comparative Research, Vol. VIII, No. 1(XX). ISSN: 2277-7067
Simatele, M. & Loyiso, M. (2022). Financial Inclusion in Rural South Africa: A Qualitative Approach. Journal of Risk and Financial Management 15: 376. DOI: https://doi.org/10.3390/jrfm15090376
Varghese, G. & Viswanathan, L. (2018) Financial Inclusion: Opportunities, Issues and Challenges. Theoretical Economics Letters, 8, 1935-1942. https://doi.org/10.4236/tel.2018.811126
Wijaya, T. (2023). The Rise of Innovative Credit Scoring System in Indonesia: Assessing Risks and Policy Challenges. Center for Indonesian Policy Studies (CIPS), Policy Paper No. 57.
World Bank. (2019). Financial Inclusion. Europe and Central Asia Economic Update (Spring), Washington, DC: World Bank. Doi: 10.1596/978-1-4648-1409-9
Agpaytech (2023). Neobanking Services: The Driving Force Behind Digital Payments in Nigeria. Agpaytech’s Research.
Amon, A., Jagrič, T., & Oplotnik, Ž.J. (2024). The Neobank Revolution: An Assessment of Their Contribution to the Global Sustainability. Preprints 2024, 2024041567. DOI: https://doi.org/10.20944/preprints202404.1567.v1
Atkinson, A. & Messy, F. (2013). Promoting Financial Inclusion through Financial Education: OECD/INFE Evidence, Policies and Practice. OECD Working Papers on Finance, Insurance and Private Pensions, No. 34, OECD Publishing. http://dx.doi.org/10.1787/5k3xz6m88smp-en
Bekele, W. D. (2023) Determinants of Financial Inclusion: A Comparative Study of Kenya and Ethiopia, Journal of African Business, 24:2, 301-319, DOI: 10.1080/15228916.2022.2078938
BK, M. B., & Bhandari, M.P. (2021). Microfinance Institutions: Instrumental for Promoting Financial Inclusion. Financial Markets, Institutions and Risks, 5(2), 72-85. DOI: https://doi.org/10.21272/fmir.5(2).72-85.2021
Cámara, N. & Tuesta, D. (2015). Factors that matter for financial inclusion: evidence from Peru. AESTIMATIO, The IEB International Journal of Finance, 10: 10-31. DOI: 10.5605/IEB.10.1
Dharmesh, K.M., Sushant, M., Asmita, C., Dipen, P., & Subham Sushobhan, D. (2021). Factors Contributing to Financial Literacy and Financial Inclusion among Women in Indian SHGs. Universal Journal of Accounting and Finance, 9(4), 810 - 819. DOI: 10.13189/ujaf.2021.090427.
Financial Inclusion (2022). Financial inclusion. World Bank. Available at> https://www.worldbank.org/en/topic/financialinclusion/overview#1
Ganapathy, A. (2022). Credit Scoring Algorithms as Tools for Financial Inclusion: A Development Perspective. Intelligent Infrastructure, Series IT for Change.
Josyula, H.P. (2021). The role of fintech in shaping the future of banking services. The International Journal of Interdisciplinary Organizational Studies, Volume 16, Issue 1, pp. 187-201. ISSN: 2324-7649 (Print), ISSN: 2324-7657 (Online).
Kabakova, O. & Plaksenkov, E. (2018). Analysis of factors affecting financial inclusion: Ecosystem view. Journal of Business Research, Elsevier, vol. 89(C), pages 198-205.
Kaligis, N.V.B., Tewal, B., Maramis, J.B., & Mangantar, M. (2018). Financial Inclusion Profile: Determinant and Barriers. International Journal of Economics and Financial Issues, 8(5), 351-358. ISSN: 2146-4138
Kempson, E., Atkinson, A., & Pilley, O. (2004). Policy level response to financial exclusion in developed economies: Lessons for developing countries, Report of Personal Finance Research Centre, University of Bristol. НАЈДАМ
Khan, F., Siddiqui, M. A., & Imtiaz, S. (2022). Role of financial literacy in achieving financial inclusion: A review, synthesis and research agenda. Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2034236
Monis, E., & Pai, R. (2023). Neo Banks: A Paradigm Shift in Banking. International Journal of Case Studies in Business, IT, and Education (IJCSBE), 7(2),318-332. DOI: https://doi.org/10.5281/zenodo.8011125
Nicolăescu, V.G., & Toderașcu, C. (2023). Financial education as a tool for financial development. Journal of Public Administration, Finance and Law, Issue 27. DOI: https://doi.org/10.47743/jopafl-2023-27-24
Nopper, T. K. (2020). Alternative data and the future of credit scoring. Data for Progress.
Postelnicu, L., Hermes, N., & Szafarz, A. (2014). Defining Social Collateral in Microfinance Group Lending. In Mersland, R. and Strøm, R.Ø. (eds.) Financial and Social Performance of Microfinance Institutions. Palgrave Macmillan, Hampshire, UK, 187-207.
Ravichandran, R., Muralidhar, S., & & Naresh, N.R. (2022). Neo banks, fintech, and banking -the changing landscape – a perspective – on dangers, growth, opportunities – a critical study. International Journal of Multidisciplinary Educational Research. Vol. 11, Issue 4. ISSN:2277-7881.
Sarigul, H. (2020). The determining factors of financial inclusion in Turkey. Journal of Economics, Finance and Accounting (JEFA), V.7(3), p.223-235. DOI: http://doi.org/10.17261/Pressacademia.2020.1290
Shankar, S. (2013). Financial Inclusion in India: Do Microfinance Institutions Address Access Barriers? ACRN Journal of Entrepreneurship Perspectives, Vol. 2, Issue 1, p. 60-74. ISSN 2224-9729
Shanmugam, S. (2022). Digital transformation through fintech: an analytical study. Shodhsamhita: Journal of Fundamental & Comparative Research, Vol. VIII, No. 1(XX). ISSN: 2277-7067
Simatele, M. & Loyiso, M. (2022). Financial Inclusion in Rural South Africa: A Qualitative Approach. Journal of Risk and Financial Management 15: 376. DOI: https://doi.org/10.3390/jrfm15090376
Varghese, G. & Viswanathan, L. (2018) Financial Inclusion: Opportunities, Issues and Challenges. Theoretical Economics Letters, 8, 1935-1942. https://doi.org/10.4236/tel.2018.811126
Wijaya, T. (2023). The Rise of Innovative Credit Scoring System in Indonesia: Assessing Risks and Policy Challenges. Center for Indonesian Policy Studies (CIPS), Policy Paper No. 57.
World Bank. (2019). Financial Inclusion. Europe and Central Asia Economic Update (Spring), Washington, DC: World Bank. Doi: 10.1596/978-1-4648-1409-9
Published
2024-06-25
Section
Articles
