By Akinpelu Babatola Guest Writer, The Xpress Train
What is Financial Inclusion and how does it affect today’s Gig Economy?
Before we go about learning what Financial Inclusion has to do with the Gig Economy, we must first understand what Financial Inclusion means. Financial Inclusion as defined by Investopedia refers to “efforts to make financial products and services accessible to all individuals and businesses regardless of their personal net worth or company size.” It is essentially an effort to level the financial playing for everyone whether it is an individual, Startups, or international business or corporation.
The World Bank’s Global Index purports that over a billion adults on the planet do not have access to financial products and services of any sort. This means that this massive number of people, which is a sizable portion of the earth’s global population do not have a bank account. Knowing this, it is easy to see that financial inclusion is a necessity as not only will it help individuals earn, save and invest, but it will also help them build their assets while reducing their vulnerability to sudden economic changes.
The word Gig Economy finally made its way into the Merriam Webster Dictionary in 2019. It is defined as “economic activity that involves the use of temporary or freelance workers to perform jobs typically in the service sector.” Going by this definition, it is easy to conclude that freelance workers, Uber drivers, and other sorts of jobs on a temporary basis make up the gig economy.
The Gig economies have been around for a long while. Think in terms of consultants, temp staff and you will see what I mean. It is thanks to further technological advancement that it has now become the widespread phenomenon that it is today. The trillion-dollar industry currently has millions of “workers” and it is still hiring more.
So what does financial Inclusion have to do with the Gig Economy?
Financial Inclusion and the Gig Economy.
- If Financial Inclusion is able to achieve its aim of bringing the unbanked into the market, then it would only create access to even more customer data. This data will help with further economic analysis and will make projections and predictions more precise. For the Gig Economy that is slowly growing in size all over the world, understanding human financial traits is very important.
- Gig jobs started out as side hustles or ways to get extra cash. This could be interpreted as a poverty alleviation process. With financial inclusion at the forefront of world governments’ minds, it would seem that gigs are the way for a lot of people to break into the financial world and escape from poverty which will in turn create economic equality or at least a semblance of it.
- Financial inclusion is a means to level the playing field. It is much more imperative that policies are put in place to protect the gig economy and allow gig workers to achieve stability. In doing this, a world without hunger will no longer be a pipe dream.