---
title: "Bridging the Gap: Advancing Financial Access"
description: Explore cutting-edge strategies and technologies transforming access to banking and payments for underserved retail and SME communities - driving inclusive growth.
---

[SFF 2024 Session Recordings-Payments ](https://39936595.hs-sites.com/sff-2024-session-recordings-payments)

# [Bridging the Gap: Advancing Financial Access](https://39936595.hs-sites.com/sff-2024-session-recordings-payments/sff-2024-videos-payments/bridging-the-gap-advancing-financial-access)

 Written by [GFTN](https://39936595.hs-sites.com/sff-2024-session-recordings-payments/author/gftn) | Nov 19, 2024 5:00:00 AM

 

**Key Highlights**

**1. Importance of MSMEs**

- **Economic Contribution:** MSMEs account for 50% of global GDP, 70% of global employment, and 90% of businesses worldwide.
- **Funding Gap:** An unmet financing need of $5.2 trillion annually affects 65 million MSMEs, primarily in emerging markets.
- **Opportunity Lost:** This gap represents untapped potential in job creation, innovation, and economic growth.

 

**2. Barriers to Financial Inclusion**

- **Creditworthiness Concerns:** 
    - Lack of formal credit history among SMEs and underserved individuals deters traditional banks.
    - Advanced credit assessment models and alternative data usage can help bridge this gap (e.g., ANEXT Bank’s solutions).
- **High Cost to Serve:** 
    - Serving underserved clients, especially in geographically dispersed regions, remains costly for financial institutions.
    - Leveraging technology, such as mobile apps and embedded finance, lowers the cost-to-serve.
- **Digital Literacy and Trust:** 
    - Many MSMEs lack digital savviness, making adoption of digital tools challenging.
    - Transparency, trust, and hyper-personalisation are critical for bringing underserved clients into the financial system.

 

**3. Strategies for Financial Inclusion**

- **Embedded Finance:** 
    - Seamlessly integrating financing solutions at the point of transaction improves MSME outcomes (e.g., Amazon’s embedded installment offerings).
- **Partnerships:** 
    - Collaborating across private and public sectors to align on data sharing, regulatory compliance, and scalable solutions.
    - Initiatives like MAS’s Veritas Consortium promote responsible AI and machine learning practices.
- **Localised Solutions:** 
    - Products must address unique country-specific nuances, such as cultural differences in trust and financial behaviors.

 

**4. Role of Technology and Data**

- **Leveraging Alternative Data:** 
    - Using ecosystem data to evaluate SME creditworthiness, reducing barriers to entry.
- **Cost Optimisation via Digital Solutions:** 
    - Digital banking reduces dependency on physical branches, enabling scalable operations in underserved markets.
- **AI and Machine Learning:** 
    - Innovations like GenAI streamline customer service and improve efficiency in financial operations.

 

**5. Collaboration Between Public and Private Sectors**

- **Data and Cybersecurity:** 
    - Unified frameworks are required for sharing data securely and combating fraud and cyber threats.
    - Initiatives like ASEAN payment connectivity exemplify successful cross-border collaboration.
- **Sustainability and Inclusion:** 
    - Government incentives and regulations, such as ESG reporting, foster sustainable practices among SMEs.

 

**6. Emerging Trends and Innovations**

**Sustainability as a Business Imperative:**

- MSMEs adopting sustainable practices improve resilience, profitability, and compliance with evolving regulations.
- Banks like ANEXT embed ESG data and insights into digital platforms, helping SMEs kickstart their sustainability journeys.

**Digital Currencies and Blockchain:**

- Programmable money and tokenized assets enhance efficiency and liquidity for SME financing.
- Real-world applications, such as collateral tokenization, create lower-cost financing solutions.

**Cross-Border Connectivity:**

- ASEAN payment systems are becoming increasingly integrated, fostering greater economic collaboration and growth.

**Fraud Prevention and Cybersecurity:**

- Combatting deepfake scams and unauthorized fraud remains a top priority for financial institutions, with a focus on staying one step ahead.

 

**Conclusion**

Financial inclusion for SMEs and underserved retail clients requires a combination of innovation, technology, and collaboration. By addressing barriers like creditworthiness and cost-to-serve, financial institutions can unlock immense potential for economic growth. Public-private partnerships, sustainable practices, and emerging technologies will play pivotal roles in building a more inclusive financial ecosystem.

 

Watch Full Session

 

Speakers:

- Ashmita Acharya, Head of Wealth and Personal Banking, Singapore, HSBC
- Henry Choi, Managing Director, Head of Retail TMRW, United Overseas Bank
- Sujit Misra, Director, Amazon Payments APAC, Amazon
- Toh Su Mei, Chief Executive Officer, ANEXT Bank

 

Moderator:

- Fernanda Lima, Partner, LeapFrog Investments

  

  

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