PAYMENTS BUSINESS
Banking the Unbanked Markets O
By Michael Penner
10
TOTAL FINANCE
ver the last decade the global payments industry has seen tremendous growth, providing increased convenience and opportunity to both businesses and consumers, but advancement does not always happen quickly or uniformly. In Canada, the total payments market grew to 22 billion transactions worth $9.9 trillion in 2019. More recently the COVID-19 pandemic has accelerated the global digital shift across all industries resulting in a global digital transformation, and the payments industry has not been spared. In Canada, 2020 saw a 62 percent reduction in the usage of cash and 42 percent of consumers refusing to shop at businesses that did not offer contactless payments.
While the shift to digital payments in Canada has been rapid and relatively seamless, not all countries had such an advanced payment landscape to facilitate this transformation. Globally, 1.6 billion adults do not have an account with a financial institution or mobile money provider, most of these consumers reside in Southeast Asia. Individuals without a bank account tend to be located outside of major metropolitan centers and have lower income and limited education. This situation has led to a significant challenge in adapting to this shifting landscape for regions with high unbanked and underbanked populations. At a fundamental level, consumers without a bank account are severely limited in what they can
WINTER 2021
