Can technology bridge the gap between rural development and financial inclusions?

ABSTRACT

Poverty reduction and income inequality have remained major challenges in all economies especially in developing countries. It is evident that digital financial service, as a platform, enhances great opportunities to access finances in various areas. Unfortunately, the markets in developing economies are fragmented and the use of digital financial services has not yet gained popularity. The often-cited barriers to mobile money adoption in these economies include but not limited to illiteracy, limited knowledge about mobile money and very low levels of trusts and above all poor infrastructures. The high-level disparity between the rural and urban dwellers is another very big issue based on their inability to benefit from the services. And these financially excluded are those who do not use any financial services or products to manage their finances. It is on record that technology interventions assist financial institutions to reduce costs and affords them increased customer reachability; however, most of the rural dwellers are not on their radar. This paper sets out to determine the extent to which the visible and ever increasing gap of financial exclusions can be bridged with the application of technology. Findings however revealed that most financially excluded individuals and businesses find solace in the informal sectors due to the traditional human touch involved. And the informal sector offers them the benefits of deeper customer relationships as opposed to endless forms that need to be filled in the formal financial institutions. The paper recommends a rethink on the part of the financial institution managers and the inclusion of some aspects of the activities of the informal sector in order to woo the unbanked and the under-banked.

KEYWORDS:

• Technology
• financial inclusion
• rural areas
• under-banked and unbanked

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes on contributor

Edwin Agwu is presently an Associate Professor of Strategic Management at Lagos Business School, Pan-Atlantic University, Lagos State, Nigeria. He is an astute banker, active/versatile researcher, a seasoned professional lecturer, management/training consultant and accomplished education/business manager; with 12 years banking and finance experience and more than 15 years of lecturing experiences in various academic institutions in the United Kingdom and Nigeria. Dr Agwu attended the Federal College of Education, Okene, where he bagged the Nigerian Certificate in Education (NCE) specialising in Science/Education. He attended the University of Lagos for his BSc (Hons) also in Science/Education. He also attended Adekunle Ajasin University, Ondo State, where he bagged MBA in General Management. He proceeded to the United Kingdom where he attended Staffordshire University, West Midlands and bagged MSc in International Strategic Management and PhD in Strategic Management from University of Wales, Cardiff, also in the United Kingdom. Dr Agwu is an effective communicator with excellent planning, organisational and negotiation skills as well as the ability to lead, reach consensus, establish goals and attain results. Academically qualified and professionally/commercially experienced, with several years of lecturing experience cutting across all ages/levels – postgraduates, undergraduates, diplomas and certificate levels in Universities and Colleges in the United Kingdom and Nigeria. And a cross-border experience in a broad range of business and management training, curriculum development, school management and administration and proven skills in marketing and management of change; with the ability to adapt to multicultural settings with strong interpersonal skills and ability to handle students and clients from different nationalities. He was formerly the Director of Quality Assurance and Academic Standards at Covenant University, Ota, Ogun State. He is an active researcher with more than 60 publications and numerous citations in several International Journals and conference proceedings. Dr Agwu has also published extensively on very diverse research topics related to the domains of business strategy, sustainability, marketing, HR, management, SMEs as social agents in the society and adoption of technologies in financial services industries.