Banks And Fintechs Use Technology For Economic Development

May 2, 2024  |  Mark Hillary

The team from IBA Group will be at the Dubai FinTech Summit on May 6-7 in Dubai. Fintech is one of the fastest developing industries in the world at present, so this month I decided to take a look at the conference agenda and to theme my blog articles here on the topics being explored at the Dubai Fintech Summit.

Environmental, Social, and corporate Governance (ESG) is a very important topic in banking at present for a number of reasons. First, there is a lot that banks can do to stimulate industry in regions that need more help – such as developing countries.

Second, there is also a strong business focus on ESG because customers, partner companies, employees, and investors are all interested. Your customers want to know your position on ESG — as well as potential employees — and investors are often making it a condition of their investment.

There is a session at the fintech conference in Dubai titled ‘The Role of Global Institutions in Economic Development.’ It’s a fireside chat between Charith Mendis, the head of worldwide banking industry at AWS in the USA and Ian Cramb, COO of UBP from Switzerland.

This should be a very good conversation because AWS is a technology giant that is helping to enable many new fintech services and UBP is a Swiss bank focused on wealth management. This combination of banking and technology experience is extremely valuable — especially in less mature markets.

Banks play a crucial role in the economic development of less developed economies by providing financial services that facilitate investment, savings, and capital formation. The combination of fintech with safe and secure cloud services can accelerate access to many types of financial service and this can create several specific opportunities:

Access to Capital

Banks can provide access to capital through loans and credit lines, enabling businesses to invest in infrastructure, technology, and human capital. This is especially important for small businesses.

Financial Inclusion

Banks can promote financial inclusion by offering banking services to individuals and businesses in underserved areas. This helps in mobilizing savings, promoting entrepreneurship, and reducing poverty.

Infrastructure Financing

Banks can finance infrastructure projects such as roads, bridges, ports, and utilities, which are essential for economic development. Infrastructure investments can attract foreign investment, stimulate economic activity, and improve productivity.

Banks can also promote the adoption of new technologies through their own use — such as services like AWS. Mobile banking, digital payments, and online lending platforms can all stimulate the use of mobile devices and data.

There is an important intersection between the technology that a company uses and how their ESG audit will look. Technology cannot answer every question — many ESG issues are cultural and can only be led by the executive management — however, there are tools that can really make a difference for banks and fintech organizations that are exploring these questions.

The SAP Green Ledger is a good example. Companies that are concerned about their carbon footprint can find it difficult to estimate genuine carbon use and emissions. The idea of the green ledger is to automate the capture of data focused on carbon use — carbon accounting that can be tied to traditional financial accounting.

Banking and fintech can play an important part in helping economic development and technology systems like SAP can help companies to measure their ESG impact. Banking doesn’t often get the appreciation the industry deserves, but this session in Dubai promises to shine a light on some of the opportunities that banking and fintech generates.

For registration and more information on the Dubai FinTech Summit agenda click here.

Follow IBA Group on LinkedIn for regular updates and comment. For more information on technology strategy and how tech connects to real business solutions please click here.

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