Global fintech sme financepromise: opportunities & challenges

Financial technology, in short fintech, has revolutionise global financial markets considerably attracting the attention of financial institutions, Governments, multilateral financial institutions such as the World Bank, International Monetary Fund (IMF), Alliance for Financial Inclusion (AFI), among others. First developed in Kenya, East Africa now replicated across the world expanding the financial access frontier to majority of the underserved and unserved segments of the population in a sustainable, safe and affordable manner through access to payment systems, insurance, savings, remittances, credit and other services. Fintech has positively impacted on poverty, jobs, livelihoods and overall boost economic growth and development. However, fintech could be disruptive and may have huge consequences in terms of losses and socio-economic impact as witnessed by the long history of financial crises – Asian and Global financial crises of 1997 and 2008 respectively. In many circumstances, financial innovation triggers widespread instability if not checked. The study examines the significant role of fintech in financial inclusion drive however, its consequences may be greater with resultant costs in terms of increase in suicides, huge indebtedness, with resultant aggressive loan recovery methods, increase poverty, loss of dignity and more serious case of financial distress, financial instability and considerable resolution costs.