Igniting financial inclusion through innovation

More than 1 billion people in the Asia-Pacific region still lack access to formal financial services, 45 million people in the US have thin or no credit profiles, 45 million people in Brazil are unbanked and 5 million people in the UK have no credit history. 

These staggering facts show the severe extent of financial exclusion around the world. People in this situation are less able to save, borrow, send money or start a business. They do not benefit from the global banking and commercial networks in the same way as those with bank accounts and access to credit.

The mainstream financial system plays a critical role in enabling fair access to affordable credit, access that can open the door to life-changing opportunities from homes and healthcare to education and entrepreneurship. It can drive the social and economic development needed to lift people out of poverty. 

Improving financial health is a key strategic priority for global data firm Experian, a leader in credit information and analytics. From making it easier for consumers to understand and manage their credit profiles to bringing more people into the mainstream financial system, Experian uses its expertise in data and technology to develop solutions to substantial problems across the globe.

“As the largest credit bureau in the world, we play a vital role in collecting and analyzing data to provide lenders with the information they need to decide whether to offer credit, and at what rate,” says Abigail Lovell, Chief Sustainability Officer at Experian. “Ultimately, this is about helping people to put roofs over their heads and food on their tables, as well as supporting families in getting access to a better life.”

But for the millions of people worldwide who are still invisible to the financial system, with severely limited credit profiles, these challenges are all too real. These “credit invisible” consumers find it difficult and often impossible to access affordable, mainstream financial services. Experian has taken up this challenge and is making notable progress. 

For the second consecutive year, Experian has been recognized with the prestigious Fast Company 2023 World Changing Ideas Award—celebrating ideas that have the “potential to drive true change” —for the company’s use of innovative technology to promote financial inclusion. Experian Go is a free program that empowers credit invisibles to establish their financial identity within minutes, which can transform their chances of gaining access to financing.

“Experian Go is a great example of how we’ve addressed a crucial need by providing individuals with no credit history with the tools necessary to participate in the financial system and better manage their credit,” Lovell says. 

“There are other examples,” she adds. “Across Africa, more people have mobile phones than bank accounts in many areas. We’ve created a unique app—called Up—that enables people to easily access financial information. Since launch, we’ve now partnered with a retailer to pre-install the app on new mobile phones and offered a free airtime voucher to encourage more usage. At the same time, we are exploring how people’s use of these apps could, with their consent, be used to validate their identity and inform responsible lending decisions for them in the future.

“Imagine working hard every day but not being able to buy a home, purchase a car or get a loan to open your dream business because you’re excluded from the credit economy due to a limited credit history. Through innovation and our passionate team of innovators, we think we can help turn the tide and empower marginalized communities to change their financial future by closing the wealth gap.”

To find out more about the Experian Exchange series, go to Experian.com/exchange.