financial inclusion govtech
Banks North America Regtech

Driving Financial Inclusion Through Compliance: Helping the Underserved

Financial inclusion is a global problem, where over one billion people don’t have access to a bank account. With several start-ups looking to solve problems for the unbanked, there are still a lot of financial hurdles that need to be overcome. 

Amit Sharma is CEO of FinClusive, a hybrid fin-/reg-tech company that provides a full-stack financial crimes compliance platform that facilitates inclusion (access to secure accounts and payments) for the world’s financially underserved and excluded. 

As General Counsel, Candace Kelly leads legal, policy, and government relations at the Stellar Development Foundation, a non-profit organisation that supports the development and growth of Stellar, an open-source network that connects the world’s financial infrastructure. Candace’s role focuses on bridging the gap between the public and private sectors.

Here, they have collaborated to share their thoughts on driving financial inclusion through compliance.

Candace Kelly, General Counsel, Stellar Development Foundation

Globally, more than 1.6 billion individuals are currently excluded from the banking system, constraining financial inclusion and prosperity. When you factor in small businesses, the plight of the financially underserved is even larger, as some estimates indicate as many as 65 million micro and small businesses in the emerging and frontier markets are unable to meet their financing needs each year, and are unable to obtain formal lending or access to credit services. In the United States alone, approximately 24.2 million households — 48.9 million adults — are underbanked. The myriad tech startups working to mitigate this growing issue face burdensome roadblocks to innovation in meeting traditional risk and compliance obligations–often cited as the critical issue challenging access to basic financial services.

Rather than perpetuating the long-standing struggles within the existing system, financial crimes compliance (FCC) measures should serve as a guide to innovative financial technology platforms into the mainstream with a clear framework from which to work. Done right, a modernised application of FCC among growing fintech and crypto companies, and emerging alternative financial ecosystem and networks would facilitate needed inclusion and essential financial system controls in tandem. 

This is the impetus for the recent emergence of “compliant-centric financial inclusion gateways,” which can provide organisations with the tools necessary to ensure compliance is efficient and effective, helping to promote access and foster innovation. Importantly, they also represent a way for regulatory oversight–essential in sensitive sectors like finance and banking–to be more appropriately framed and equally as innovative as the continually evolving financial services ecosystems and participants they are meant to supervise and keep safe.

With embedded compliance tools, these gateways provide a comprehensive framework, or Rulebook, for

Amit Sharma, Founder at FinClusive.

fintech companies addressing the needs of the financially underserved, but oriented to consumer-friendly platforms built to connect people and organisations globally and more seamlessly allow the safekeeping and transfer of value. FCC has traditionally been a piecemeal approach for many traditional financial institutions, and dependent on the nuances of their particular jurisdiction’s regulatory regime.  This can be challenging for institutions to operate efficiently in an already cross-border financial world with differing regulatory requirements–even more so for modern financial technologies and virtual asset service providers (VASPs) whose operational protocols and activities differ from their traditional bank financial institution counterparts.

Organised around the global standards for anti-money laundering and counter-financing of terrorism (AML/CFT) guidance and international payments/value transfer rules, a common set of governing principles better assures adherence to local regulations while managing risk for all parties involved–regardless of what type of entity they may be or what oversight body they may fall under. Regulation is inherently border-bound, but a sector-driven Rulebook helps incentivise a globally-interconnected system to promote secure access and self-governance in tandem.  Fintech and crypto companies bring tremendous opportunities to drive safe and scalable inclusion, and such a Rulebook helps ensure the underlying intents of regulatory compliance are applied effectively and efficiently.  Security and transparency can be achieved while ensuring those outside the financial system are finally given the access they need to build financial health and economic resilience. 

From a technological standpoint, sending money around the world should now be easier than ever, but traditional approaches to meeting a globally diverse set of jurisdiction-based rules in an ever-evolving regulatory landscape often are costly and inefficient.  In certain instances, conflicting jurisdictional requirements have only hampered innovation, such as those in the global remittance market as an example, which has dimmed hopes of providing a valuable service to the un-/under-banked–many of whom depend on such flows for their families’ livelihoods.  For a fintech startup ready to take on a market ripe for innovation, a partnership with a gateway service that embeds compliance offers a cost-effective and efficient approach to facilitating cross-border payments while remaining compliant with local banking regulations from start to finish. 

According to a McKinsey report, if by the year 2025 the 1.6 billion unbanked individuals are brought into the financial mainstream, there would be another $4.2 trillion in new deposits, $2.1 trillion in new credit, 95 million new jobs, and an estimated $3.7 trillion bump in global GDP growth. Further, enabling the millions of small and micro-businesses to access basic financial services including the ability to make payments and access formal credit would support even greater job-growth and strengthen household and community financial health!  Organisations working to establish a more financially equitable future should be encouraged to help lower the barriers to the existing financial systems in a manner that reinforces, rather than dilutes important risk and security measures, and these compliance gateways are helping to pave the way.


  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

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