The un(der)banked is FinTech’s largest opportunity

Executive summary
Trending now
The un(der)banked: FinTech’s largest opportunity. Mobile money
services have proven to be an effective gateway for financial inclusion
among the un(der)banked, a demographic that could evolve into a US$3
trillion payments volume opportunity. But mobile money services are a
fraction of the opportunity and have converted only a small fraction of
the unbanked population into users of additional services. For example,
we see $360 billion in unmet banking deposit demand, with insurance
facing more than $20 billion in uncaptured premiums in the U.S.
market alone.
Mobile has been the enabling technology, and money services act as the
entry point for the un(der)banked. Access, trust, and tapping into
evolving consumer behavior will drive the sustainable conversion of this
demographic to the formal financial system. With 42% of the global
adult population still absent from the formal financial system, the
financial services and FinTech industry is in a rare position to drive not
only economic and innovation change, but also social change.
Innovators are starting to move beyond money services to address
lending, insurance, and even the savings area. With innovation
occurring in multiple functional banking areas aimed at the
un(der)banked, incumbent financial institutions can now consider
an aggregate financial inclusion strategy based solely around these
emerging FinTechs.
A look ahead
Wealth management has lagged other areas of financial services in
responding to change. With the ensuing $30 trillion that will transfer to
millennials over the next 30 years, these firms will need to consider the
“socialization” of wealth management in order to capture the opportunity.
Strategy&
5