As the financial industry becomes more inclusive, we keep discovering different methods for managing money that people are using around the world. Technology certainly plays a factor, and in some parts of the world, customers can bank without ever stepping into a physical branch. Here are some of the most interesting ways people are managing money around the world:
Mobile money accounts
In Sub-Saharan Africa, 12 percent of account holders manage their finances through a mobile money account, compared to 1 percent of the global population. Of that percentage, 45 percent bank solely through their mobile money account. Mobile money accounts are helping underserved communities participate in the banking system, and are an asset in rural, less developed regions of the world.
Women’s banking preferences have only recently been considered, and in some cultures it is still taboo for a woman to make household finance decisions. However, when a woman is left to tend to the home while her husband is away, financial emergencies can arise, and exceptions must be made. The ability to have an emergency loan when a family member suddenly falls ill or to pay for a child’s education, allows family planners to focus on daily tasks without stressing too much about being ill-prepared in case of an emergency.
As banking becomes more accessible, it’s interesting to note that many consumers continue using semi-formal methods to manage money in addition to formal savings accounts. One common form of informal saving is a rotating savings and credit association (ROSCA), which generally operates by pooling the weekly deposits of their members and distributing the entire amount to a different member each week. Semi-informal saving methods are most common in Sub-Saharan Africa, Indonesia, Jamaica, and Jordan, and advantages include convenience and community building.
These are just a few of the inventive ways people are taking control of their finances around the world. As our options for financial management continue to expand, we look forward to learning more new and unorthodox ways to manage our money.