The fintech industry and its contribution to global sustainability challenges

Technological advances have generated drastic changes in what we knew as financial services. The director of the European Banking Federation's Sustainable Finance working group, Alfonso Ballabriga, gave a speech during the 2019 European Banking Summit in which he explained how digitalization contributes to the Sustainable Development Goals (SDGs).

The aspects of sustainability and projections to avoid risks are increasingly accurate thanks to predictive technology tools, so financial institutions can have a broader and more accurate picture of their investments.

Sustainability and fintech go hand in hand

To explain this correlation, in his speech he highlighted some fundamental pillars; firstly, he referred to financial inclusion through digital identification, the use of Big Data and Artificial Intelligence (AI). According to him, there are 1.7 billion unbanked people in the world and digitalization is an excellent alternative to include individuals and SMEs in the financial sector.

In this way, it is possible to understand that technology has a fundamental role in financial inclusion as a strategy for development, thus contributing to SDG 8: Decent work and economic growth, and that digitalization contributes to accelerating the movement of funds for sustainable investments. 

Finally, he stated that data managed by new technologies will play a key role in achieving better results in managing climate and social risks. 

An example of a fintech that contributes to financial inclusion is Smartcash, created by Nuvu. This tool makes it possible to make payments easily and securely, reducing operating and transaction costs and facilitating access to the financial system.

This contributes to the SDGs, especially number 9: Industry, innovation and infrastructure, because its good use can trigger a breakthrough in the country by increasing the percentage of available jobs by boosting the economy and the handling of electronic transactions.

This type of aid is designed so that users can keep track of their money immediately, making payments quickly without spending as much time as in the usual face-to-face transactions.

In the current climate and with the challenges of the COVID-19 pandemic, the use of digital solutions is growing rapidly, increasing the demand for remote customer service personnel providing support remotely.