The Digital Finance 2.0 report points to the use of artificial intelligence and smartphone apps as a means of increasing access to financial services.

1.7 billion people across the world are excluded from the mainstream banking system. Improving their access to finance will have significant economic and social benefits.

Santander aims to financially empower 10 million people by 2025 through improving access to basic services while supporting low-income families and vulnerable groups, principally in Brazil, Argentina, Mexico, Chile and Uruguay. There are also programmes to improve people’s financial knowledge and decision-making across Europe and the Americas.

It is estimated that innovations in digital banking could unlock at least $49 billion of new loans and other financial services for the 200 million people without access to banks in Latin America. In the first half of the year alone, Santander has helped more than 470,000 people in Latin America through microfinance – tiny loans that can make a big impact.

Sergio Rial, CEO of Santander Brazil and regional head of the Latin America region, said: “Microentrepreneurs are fundamental to resuming Brazil’s development cycle, because they create jobs and move resources where these effects are most noticeable. We have an obligation to look for levels of local business participation in the economy that are comparable to those in more developed countries. We will do this by supporting our millions of microentrepreneurs in realising their dreams.”

For Bernadette, a 67-year-old seamstress in Paraisopolis, Brazil, a microloan allowed her to rent a small shop and buy two sewing machines. After 13 years, her success in the community has allowed her to expand and modernise her studio and the people of Paraisopolis have a local service to help their clothes last longer. 

In the case of Rosa Hernandez from Chalco in Mexico, an initial credit of $5,000 pesos ($255 USD), helped her to increase the regularity of her business, taught her how to manage her finances and provided her with an account where customers could pay her for her services and she can save money. Rosa said “I like to know I have money saved up for an emergency, because if I keep it in my house…I go and spend it.”