While Singapore’s unbanked population is minuscule, the Covid-19 crisis has shown that certain categories of foreign workers have limited access to low-cost financial services.
Since 2018, one of the themes of the Singapore FinTech Festival is financial inclusion in Asean. The Asian Development Bank points out that the effect of leveraging digital technology to bank the unbanked could boost GDP by 2% to 3% in markets like Indonesia and the Philippines, and 6% in Cambodia.
In a report last year, Bain & Company estimated that banking penetration in Southeast Asia is only 50% on average, compared with the 95% banking penetration rate in the US and the UK. “More than seven out of 10 adults in Southeast Asia are either “underbanked” — they have no access to credit cards or have no long-term savings product, for example — or are “unbanked”, without access to a basic bank account. In addition, millions of Southeast Asia’s SMEs face large funding gaps,” Bain says.
