Breaking down the barriers to digital equity and financial inclusion

By Vijay Guntur, President, ERS at HCL Technologies

The world is moving in a clear trajectory towards a digital future. Organisations are prioritising digital transformation, and governments are embracing digital technologies to create smart, sustainable cities. Early iterations of the metaverse – an immersive and universal virtual world – also point to a scenario where many physical interactions and transactions could take place in a digital environment. It is therefore essential that digital equity is built into the foundation of this digital era. 

 

What is digital equity? 

The concept of digital equity ensures everyone has the same access to digital technologies and the opportunities that they can create. Yet, when it comes to putting this into practice, digital equity is hard to define and action. However, it can be measured in three broad areas: age group, gender and income level. Understanding these areas can help public and private sector organisations improve access to digital. 

For example, older demographics don’t generally have access to digital technology, while younger age groups are widely enabled. From a gender perspective, access to digital technologies differs between men and women.  When it comes to income levels, this remains the biggest barrier to digital equity. Those from the lowest income households often have the least access to digital technology, whereas higher income households have more opportunities through access to platforms, such as Uber or Airbnb.

Income levels will continue play a big role in how digital equity will become available. To change the current landscape, the public and private sectors need to do a lot more to break down income level barriers 

Facilitating digital equity in the public and private sectors 

One of the main barriers to digital equity is digital infrastructure (i.e. the foundational service of a country or organisation’s digital technology capabilities). This includes the smartphone penetration ecosystem, access to broadband and availability of hardware, such as laptops and tablet devices. 

For example, if you look at cities in India, the level of digital access is approximately 45%, but in rural areas this falls to 15%. To combat the issue of broadband access, the Indian government has set up the MyBharatNet initiative, connecting rural villages with broadband access. There are numerous initiatives in other countries, aimed at making broadband access more readily available in rural areas. Private enterprise can also help here, providing mobile devices at lower price points, meaning that more people can get access to them, and gain mobile internet access. 

The second barrier is digital education and this is an area where private enterprises can have a significant impact.  At HCL, our TechBee programme helps people in India – both men and women – who have just finished their school education by providing them with a digital skills base, in order to continue their learning. This type of initiative is growing in popularity and demonstrates how through supporting digital education, organisations can improve digital literacy and equity

Digital equity in action

It’s clear that the pace of digital change shows no sign of slowing down, so we must act now. For instance, the Covid-19 pandemic accelerated eLearning and telehealth around the world. This transition to virtual environments in the education and healthcare sectors now means that those without access to digital are at risk of being neglected by these essential services. 

A digitally equal society will create greater access to education and healthcare, which are now increasingly in a digital setting. This will contribute to an increase in income levels for generations, which in turn, will create a cycle of accessibility and equitability.

We are moving in the right direction when it comes to digital equity and there are numerous examples of it in action, particularly when it comes to financial inclusion: 

In India, the Aadhaar initiative provides people with a 12-digit identification number so they can create a digital identity and have access to banking services.  While the Unified Payments Interface supports frictionless payments, by bringing multiple bank accounts, seamless fund routing and merchant payments into a single mobile application (of any participating bank).  Access to microfinancing options brings down the cost of capital significantly for people at the bottom of the pyramid which in turn can accelerate their income generation.

This, along with ecommerce platforms, like Amazon and FlipKart, is creating a level playing field and providing market access to artisans, handicraft, self-help groups and others. While aggregator platforms, like Urban Company, are improving the regularity and consistency of jobs for blue-collar workers. 

Ultimately, driving financial inclusion through initiatives and platforms like these creates opportunities for all citizens, and will be a big part of creating a digitally equitable society both now and in the future.

 

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