Wallet As A Service and Financial Inclusion

September 6th, 2022 by Felix Cheruiyot


Little banking activities like withdrawing money from ATMs, paying bills from the comfort of your home, and sending money without having to go to the bank physically are all things an average person should have access to. Still, sadly, that hasn’t been the case. For years, people have had to endure long lines, waiting for their turn to be helped by a teller. This process usually took up a lot of time that could be used for other, more productive activities. Thankfully, all of that has changed with the rise of digital banking. Nowadays, banks and fintech companies are constantly trying to make the process of banking as easy and convenient as possible for their customers.

It’s a sad reality that many people do not have access to even the most basic banking services. According to the World Bank, 1.7 billion adults worldwide do not have access to a formal bank account. The number of people without access to banking services is especially high in developing countries. A survey conducted by FDIC earlier this year showed that 7% of American households are unbanked, which amounts to a total of 9 million households. These numbers are huge even for a country as developed as the United States.

Thankfully, new technologies and trends are emerging that improve not only financial access for everyone but also have the potential to make the whole banking system work better. One of these trends is known as “Open Banking.” Open Banking is a movement that uses application programming interfaces (APIs) to allow third-party developers to build applications and services around a financial institution’s data. This has made banking a lot easier, so people who would normally not have access to traditional banking could now enjoy banking as they like.

We have no idea how much wallet as a service is contributing to the growth of the global economy. We know that they’re efficient, fast, and safe and give us access to bank-esque services so we can enjoy banking like never before. In this article, we’ll explore how mobile wallets are revolutionizing financial inclusion and what we can expect to see in the future. However, before we do that, let’s take a quick look at some of the reasons why some people are still unbanked in several parts of the world.

Why Are You Some People Still Unbanked?

While mainstream banking remains a popular and seemingly the best option for many people, many still cannot access it for different reasons. Whatever the case may be, the number of unbanked people worldwide is alarming, which has caused us to explore some of the reasons why most of these folks may still be unbanked.

Lack of trust in mainstream banking

You may not have heard or seen it before, but some folks have vowed not ever to have anything to do with mainstream banking again. They’re called the “unbanked” or “underbanked,” which is a fancy way of saying they don’t have a bank account or only have a limited relationship with a financial institution. And according to the latest numbers from the Federal Deposit Insurance Corporation (FDIC), 7.1 percent of U.S. households - that’s 9 million homes - are unbanked. Another 20.1 percent of U.S. households are considered “underbanked,” meaning they have a bank account but also obtain financial products and services outside the banking system.

They don't like banks because they're seen as being too centralized and not very transparent. They don't like the fees that banks charge. They also don't like banks investing their money in things like fossil fuels and other things they may not agree with. So they've decided they will take their money out of banks and put it into something entirely different, anything but the mainstream banking system.


Unemployment is another factor that contributes hugely to the high number of unbanked people across the globe. Though unemployment is only one of many factors contributing to the high number of unbanked people, it is important. It is estimated that unemployment is a factor in 25-30% of all cases of unbanking, and it is one of the top reasons people turn to alternative financial services.

In most cases, these people lack access to traditional financial institutions like banks and credit unions. This makes it difficult for them to obtain the necessary loans and services that would help them improve their lives. Additionally, unemployment can lead to decreased income, making it even harder to overcome financial difficulties.

Lack of steady income

A person that doesn’t have a steady income is more likely to be unbanked than someone who does; it’s a no-brainer. You need money to put in the bank to access banking services. Unstable income contributes hugely to the high number of unbanked people across the globe. An unstable income makes it difficult to maintain a minimum balance in a checking or savings account, leading to fees. For people living paycheck to paycheck, every dollar counts. They can’t afford to have money sitting in a bank account when they need it to pay their bills.

Most people think it’s necessary to have a steady income to bank with any level of security. This is partly true, but having an unstable income can be just as damaging to your bank account. If you can’t always count on your income, you’ll likely miss a payment or two and incur fees. This can quickly lead to a negative balance in your account and a feeling of insecurity regarding your finances.

Unstable incomes are one of the main reasons so many are unbanked. When incomes are unpredictable, building up a savings buffer becomes difficult. This can lead to costly fees if you try to open a checking or savings account, making it difficult to pay your bills on time.

Convenience and access

You may not need to look for complex reasons to know why a person may be unbanked. The reason may be as simple as convenience and access. A person may be unbanked for convenience and access reasons. Convenience may be that the person does not need to go through the hassle of setting up a bank account or has no need for one. Access may be that the person lives in a rural area or does not have access to a bank. In a rural area, a person may not have access to a bank because there is no one nearby to do business with. There are also some cases where people are unbanked because they live in an area where it is difficult to get a bank account.


As simple as it may sound, bankruptcy contributes hugely to the growing number of unbanked people across several countries in the world. It is no wonder that many bankrupt people often shy away from getting loans and other financial products. The bankruptcy process is not easy, and people often take a long time to get their lives back on track.

In the United States, for example, bankruptcy records are accessible to the public, which discourages people with bankruptcy records from applying for checking accounts. Check-issuing institutions can deny applications for checking accounts based on bankruptcy records. Additionally, check-issuing institutions often charge higher fees for people with bankruptcy records. As a result, people with bankruptcy records are less likely to have checking accounts than people without bankruptcy records.

What is Financial Inclusion?

Financial inclusion can be difficult to define, but it generally refers to the ability of people and businesses to access meaningful and cheap financial services and products. This can be done through various channels, such as payments, insurance, transactions, credit, and savings. Financial inclusion has various benefits for individuals and businesses, including reducing poverty and increasing prosperity.

Financial inclusion is a complex and multi-faceted issue. It can be broken down into several key areas, such as access to financial products and services, the satisfaction of financial needs, financial literacy, and financial stability. Financial inclusion can play a significant role in reducing poverty and increasing prosperity. It can help people meet their basic needs, such as food and shelter, and help businesses grow and expand.

According to World Bank, 55 countries have made several commitments to financial inclusion since 2010, and more than 60 countries have launched national strategies to aid financial inclusion. Some of these strategies include leveraged government payments where individuals would have no choice but to open their first financial account to be able to receive these payments. Mobile financial services have also been put in motion, and one of the most underdeveloped continents is thriving because, while people may not have access to traditional banks, mobile financial services have been hugely accepted.

How Digital Wallets Are Boosting Financial Inclusion

Digital wallets are considered the perfect tool and a huge booster of financial inclusion. People who normally want nothing to do with the mainstream banking system can be lured back into the system, thanks to mobile wallets, which are seen as the perfect solution. With wallet as a service, people can enjoy bank-like services without having a bank account; that’s the perk! Mobile wallets have a diverse range of purposes, but their role in the growth of financial inclusion is indisputable.

They provide an easy way for people to access financial services, whether they are new to the system or have been excluded from it in the past. This is especially beneficial to those who do not have a bank account or want to keep their banking activities simple and portable.

Mobile wallets have been gaining much popularity lately, as they are seen as the perfect solution for people who don’t want anything to do with the mainstream banking system. With mobile wallets, people can enjoy many of the same features as bank-based services without having a bank account. This is great for those who want to take advantage of the benefits banks offer but don’t want to tie themselves down to a traditional bank.

Digital wallets work like a normal bank, only that it is safer and more convenient. People with digital wallets can store funds, make payments, transfer money to other financial accounts, and some can even write checks. To understand how digital wallets work, it is important to know what they are. A digital wallet is an electronic device that allows an individual to make electronic transactions. This can include purchasing items on the internet using a debit or credit card, or it can also refer to transferring funds between two different accounts. It is important to note that not all digital wallets are the same, and different types offer different features.

The best part about having a digital wallet is that it is much easier to keep track of your spending and budgeting. You can see all your transactions in one place, and you do not have to worry about losing your money if your wallet is stolen. Moreover, if you ever need to cancel a payment, you can do so immediately without going through your bank. This is extremely convenient, especially if you are traveling.

A report published by GSMA’s 2014 State of the Industry showed that there were an estimated 103 million active mobile money accounts by the end of December 2014. The numbers have since grown considerably, with millions of people using mobile wallets and mobile money services across the globe. Earlier this year, M-Pesa celebrated reaching 50 million customers across the globe, cementing its spot as arguably Africa’s largest fintech platform. This is the kind of impact mobile wallets and services have had on the banking sector in the past few years.

According to DigiPay, mobile wallets have reduced customers’ heavy cash dependency, resulting in huge financial security. Thanks to the advanced security measures in mobile money services, risks of theft, loss, and fraud have been greatly reduced over the past few years. The overall transparency in the mainstream banking system has increased, and people are beginning to trust financial institutions with their money again.

Digital wallets have even allowed people to conduct their businesses in the safest and most convenient of ways. People now use mobile wallets to receive and make payments for several goods and services. In Tanzania, 20% of users use mobile wallets for their businesses. This, again, shows how huge mobile wallets are in our world today.

Another way the mobile money sector contributes hugely to the global economy is through huge employment and entrepreneurship opportunities in rural and urban areas of several countries across the globe. Only in Kenya, M-Pesa has more than 40,000 employees.

How Governments Are Contributing To Public Policy in Financial Inclusion

Governments across the world are beginning to recognize the importance of mobile wallet services in aiding financial inclusion in their respective countries, which is why some plans have been put in place to make these services flourish further. Some of these frameworks include;

Bonus: Learn more about Wallets APIs use cases for Fintechs


Financial inclusion is gaining more prominence, and mobile wallets have been at the forefront of its significance today. The number of unbanked people in the world is alarming, and there’s no better way to get them on the good side of the system than convincing them the system will do them a lot of good only if they can trust it. Mobile wallets bridge banking services and unbanked people, providing the long-lost balance between these entities.

The positive impact mobile wallets have had on financial inclusion will likely increase in coming years as we’ll see new innovations and developments that will aid this cause. Mobile wallets provide the convenience and security the traditional banking system lacks, which is why more people are trusting mobile money services over traditional banks these days.

IntaSend enables fintech startups and developers to create secure and scalable digital wallets for financial inclusion and products across Africa. We provide a PCI-Compliant environment, many ways to fund accounts, and disburse. Visit ourdevelopers page and product overview to learn more.

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