By Zama Ndlovu, Group Head of Corporate Communications and Marketing at Onafriq
As global instability continues, initiatives such as creating financially responsible products can fall down the list of priorities in banking. But now more than ever fintechs must deliver what the next generation of wealth holders want from their financial services – environmentally sustainable products and services.
It will be down to fintechs and local businesses to offer socially responsible ways for people to buy and sell goods, not governments.
Fintechs are uniquely positioned to solve social issues because they have existing global networks, can provide access to services in rural places, improved user experience and education.
Why do fintechs hold the keys to being socially responsible?
Positive social impact is often associated with governments and NGOs, organisations that do good without the motivation of profit or brand perception. However, fintechs are uniquely positioned to solve social issues through providing access to services, improved user experience and education.
In the UK, the government is bolstering its ESG efforts by bringing in regulation, reporting standards and opening up a consultation on the UK Green Taxonomy. But all this will take time to have a positive impact on the end user, local citizens.
That’s why the fintech industry has an opportunity to step up this year. Financial inclusion transforms more than just the way people transact. Ultimately, it has the potential to positively impact other areas of people’s lives too.
The rapid growth of digital payment forms has changed the way individuals and businesses of all sizes transact across regions. This has spearheaded the drive towards financial inclusion internationally – ultimately addressing socio-economic challenges.
Let’s look at how fintechs can achieve this in three steps:
- Embed social responsibility into your business strategy
Fintechs have the power to do good, but for a company to label itself socially responsible it must be a key business priority.
For many companies, social responsibility seems like a ‘tick-box’ exercise to improve public perception. However, in a truly socially responsible fintech, the drive to improve lives and solve real-world problems is at the core of its business model, playing a role in every aspect of decision-making.
From planning and product design, to branding and strategy, every part of a socially responsible fintech’s strategy should be driven by its overall mission to solve a meaningful problem for individuals and businesses.
- Create socially responsible products
Creating socially responsible products means offering affordable, green and user-friendly financial products. It can be challenging internally, as different stakeholders often have their own priorities and prejudices which shape their personal goals.
When it comes to dealing with investors and board members, fintech leaders must balance their social impact ambitions with profitability, useability and affordability, to essentially ensure that their products can survive in a competitive market.
Fintech leaders who are determined to do good must consistently focus on bringing the right people along on their journey. They can do this by highlighting the long-term benefits of creating ethical products with social impact, fostering financial inclusion and sustained awareness. And when everyone is truly aligned to the common mission, decision-making is easier.
- Enable access for the local community
Transparent information is key for consumers making financial decisions. Using various fintech products, consumers can gain a full understanding of their financial situation and make better financial decisions as a result. Products like savings pots, investment platforms and as well access to loans can all lead to financial freedom for those without it.
If a company wants to reach individuals in unserved rural communities, it must offer affordable and user-friendly products to facilitate financial inclusion. Although this may initially impact profits as the products are cheaper, in the long run, the company will have better social impact and will be suitable for a greater number of consumers.
Although not all companies will prioritise people over profit, in 2025, the winners of the world’s leading fintech companies will reap big rewards from solving key societal issues and increasing global financial inclusion.
