In 2020 about 1.5 billion adults are reportedly still unbanked. If you factor in the number of underbanked adults who own a bank account but have no access to core financial services, then the number grows even further.
Some adults are unbanked by choice. Often this happens because the financial industry has lost or failed to earn their trust. However, there are still hundreds of millions of people who are unable to access financial services for reasons they had no say in. Kaizen finance strives to reach the unbanked and the underbanked and provide truly inclusive decentralized financial services.
Understanding the unbanked
There is a surprising amount of misconception surrounding the unbanked population. When mentioned online, the unbanked are often associated with a group of people that do not have any local banking options, cannot get an account with a local bank or distrust the banking industry. While a reasonable argument can be made for each of these, the misconception usually lies in strong-leaning into a single characteristic. After all, throwing roughly 20% of the population in the same mixing pot is unlikely going to help address their issue.
Providing the unbanked and the underbanked population with access to financial services will take a comprehensive approach that will not only address each issue individually but also make up for shortcomings of the traditional system that have ultimately resulted in trust issues in regards to all things where the banking industry is concerned.
The Issues of Local Unavailability
It is no secret that the traditional banking system requires a complex infrastructure to deliver services to its customers. The maintenance of such infrastructure, unsurprisingly, is very costly.
Banks in general usually more than make up for these costs in fees they charge. However, banks also have to factor these costs into the decision making process when considering expansion to new locations. For customers this usually means that if a banking service is not covering their area, then they have done the maths and found the expansion to the area to be unprofitable.
Kaizen finance does not operate on the principles of brick and mortar banking.
Kaizen leverages blockchain technology and advancements of decentralized financial systems. This has enabled Kaizen to break free from the burdens of bloated infrastructure upkeep and third-party involvement to maintain operations.
Essentially, through the power of blockchain, Kaizen is able to bring an ecosystem of decentralized financial services that will enable the unbanked to make the most of their assets and live more convenient and secure financial lives.
For example, Latin American countries are sinking in macroeconomic instability and exchange rate volatility. At the same time, it is estimated that around 70% of people do not have a bank account. Getting access to financial services offered by Kaizen finance would enable people who are looking to preserve their assets to take advantage of stablecoin and cryptocurrency to avoid losses. Additionally, it will provide access to money transfer, borrow and lending services at significantly lower rates.
The Issue of Service Inaccessibility
Another consequence of having a complicated infrastructure that involves a system of third parties to function is the bureaucratic process of document submission required to get started. In many cases, the process of submitting KYC documents required by traditional financial institutions becomes overwhelming, borderline repelling, and still leaves room for censorship.
Banks hold the right to refuse opening an account or deny services based on the documents provided. People who are unable to satisfy the requirements risk being left out of the ecosystem leaving them at the mercy of loan sharks or other exploratively expensive alternatives.
Kaizen finance stands by the principles of DeFi. Interoperability, accessibility, financial inclusion and transparency are at the core of Kaizen finance.
The security and identification provided by blockchain technology allows to discontinue bureaucratic KYC and make decentralized financial services accessible to anyone with access to the internet.
The Issue of Industry Distrust
You know what they say about trust, it is hard to earn and easy to lose. When it comes to trusting the banking industry, everyone has their own experience and expectations. Without getting into specifics, the distrust of traditional systems can usually be traced to centralized authorities calling the shots or one of the many third-parties involved.
Kaizen finance offers a decentralized peer-to-peer alternative to the traditional system. Instead of being put in a position where you have to trust the central bank authority, a decentralized system offered by Kaizen finance enables you to take advantage of services that are not governed by a single entity. The services operate based on smart contracts. Smart contracts are a set of rules and regulations that are executed when the conditions of the contract are met.
In Kaizen finance there is no centralized authority to distrust and no third parties to intervene.
Taking the next step towards the decentralized future, Kaizen finance makes financial services inclusive and accessible. Kaizen produced a major leap in convenience, not only achieving a qualitative breakthrough in user experience, but also making DeFi simple to get into and easy to use.