Financial Inclusion in the Supply Chain
This paper discusses the role of companies in providing formal financial access to their workers. It also discusses the cases of companies’ efforts to make financial inclusion possible for individuals across the supply chain and the impacts caused due to the same.
The paper states that companies across all the sectors are well positioned to address barriers to access. With supply chains extending throughout the developing world, companies can access the vast majority of the world’s working poor. Using their existing networks of factories and agricultural suppliers, companies can introduce employees to the formal banking sector by automating payroll or remittances systems such as, direct deposits to individual accounts. The paper discusses the importance of savings as a product and the benefits women gain by including them in the formal financial sector. It makes the following recommendations to companies looking to add financial education and access to their supply chain programs:
- Learn from existing supply chain models aimed at increasing access to financial services for the world’s poor;
- Remember that the developing world is heterogeneous;
- Address both supply and demand constraints;
- Seek partnerships with organizations that have on-the-ground experience and networks;
- Track metrics to measure impact and to encourage ongoing improvement.