BLOG

CORPORATE NEWS

Channel VAS at Webit Virtual: “We are building bridges to financial inclusion.”

5 September 2022

“Fintechs in the emerging markets are not disruptors of the financial industry. They are building bridges to financial inclusion, to the unbanked and underserved population, due to the lack of infrastructure and credit history of those people in these areas”. This was the first comment of our founder and CEO, Bassim Haidar, during the Fintech Thought Leadership Summit of Webit Virtual, where he shared his rich experience and some very valuable insights of the fintech industry, in a valuable session together with Richard Davies, CEO of Revolut.

Bassim Haidar discussed the way fintech companies use mobile technology to overcome the limitations of the traditional banking system, offering financial services to people in remote areas and with low income. “Traditional banks do not want to bank people with little income” he argued, adding that fintechs are using telco data to create history and scores and being able to reach these customers.  “We are still in the journey; we are nowhere near the top. There is still great potential for fintechs, as there is still 1,7 billion of unbanked population in the world”, he concluded.

However, the restrictions are not limited to the way banks operate, but they also apply to the lack of understanding from regulators. “Current laws belong to the old era” Mr. Haidar said and mentioned that they have to change and adjust in today’s needs. “Regulators need to allow us to use more of those data to provide financial inclusion”.

When Mr. Haidar was asked about the consequences of COVID-19 in the fintech industry, he replied that the pandemic has become a big test for the survival of fintechs. He predicted that some of the players will consolidate and unfortunately some of the smaller players will collapse, as they don’t have the necessary resources. “There is going to be a cleanup in the next three to four months, assuming there is no second wave of the pandemic”.

On the other hand, he added, “big financial institutions are starting to work with fintechs, as they realize that they are the only way to deliver solutions to the masses”. Bassim Haidar believes that in the near future big banks will try to acquire fintech companies. “There is a nice saying” he said, “when you go deeper the sharks become bigger. As there is more money in fintech the big banks are not going to sit and just watch those sharks pass by and not try to take them over”.

That doesn’t mean that this the end of banking as we know it, though. For Bassim Haidar, banks are still the pillars of the financial industry. “The business model will probably change, as they will be more focused on digital services. Banking will remain, the definition of banking will change” he concluded.

If you want to see the full Fintech Thought Leadership Summit session just click and watch the following video.