Bringing the 1.4 billion people globally without access to banking into the financial system is a key focus for governments worldwide. This initiative not only promotes economic growth at a national level but also fosters the economic empowerment of marginalised communities by creating stable conditions for them to prosper.
Countries in the Gulf Cooperation Council (GCC)—Saudi Arabia, Qatar, the UAE, Bahrain, Oman, and Kuwait—are now prioritising financial inclusion as a central element of their economic strategies, the World Economic Forum reports.
Microfinance, a crucial tool in this effort, provides individuals and small businesses who lack access to traditional banking with opportunities to engage with comprehensive financial services. This applies to a diverse group, including young entrepreneurs, students, and low-income communities.
By reducing barriers to entry, these financial services—such as loans, credit, savings accounts, financial education, and remittance options—empower people to enhance their financial stability and improve their overall economic prospects.
Adopting new technologies is essential
However, for this microfinance push to be successful, countries need stronger infrastructure to support their nascent fintech companies and promote digitalisation in the financial sector, the WEF said.
Providers themselves will also need to embrace emerging technologies like Artificial Intelligence (AI), blockchain and data analytics to improve their customer experience, attract more users and ultimately drive widespread adoption, the group said.
Micropayments can be applied in the public sector to implement pay-per-use models in several key ways. However, not every payment system is capable of micropayments and almost none are capable of offering micropayments at a government or enterprise level.
The BSV blockchain, with fees as low as $0.0001, offers a cost-effective and efficient solution for processing micropayments, unlocking new opportunities for businesses.
It serves as a real-time financial and data commodity ledger, allowing service providers to focus on their customers and removing the need for payment gateways, shopping carts, and slow transaction processing. This technology enables entirely different models, such as open application access with paid advanced features.
The BSV blockchain – the future of microfinance
The BSV Blockchain, the Switzerland-based global non-profit industry organisation supporting the use of the BSV blockchain (BSV), is dedicated to enabling the processing of micropayments, facilitating these transactions and supporting humanitarian efforts and cause-driven initiatives. By leveraging micropayments, entities can contribute to improving global equity and making a positive impact.
Ultimately, the successful implementation of micropayments as a catalyst for growth in developing economies requires addressing several challenges, including infrastructure limitations, regulatory frameworks, digital literacy, and ensuring security and privacy in financial transactions.
Collaborative efforts between governments, financial institutions, technology providers, and other stakeholders are necessary to overcome these challenges and harness the full potential of micropayments for economic growth.
