Cash and Cryptocurrencies are Especially Important to the Underbanked
If you have a bank account, you might not give a second thought to people who don’t. You just take for granted that money will be there when you need it, and that you can access it in different ways.
But did you know that approximately 30% of the world’s population is unbanked? Meaning they have no access to a bank account? And many more than that are underbanked.
The reasons for this vary, but most often people cite a lack of money, proper documentation or affordable options. Other reasons are distance, inconvenience, and lack of trust.
Nearly half of all unbanked adults live in just 7 places: China, India, Indonesia, Pakistan, Nigeria, Mexico and Bandladesh. And the majority of them are women.
In the U.S., the numbers are a little lower, but still, over 20% of American households are underbanked, according to the Federal Reserve.
So, what are these people supposed to do when they have to purchase something online, or send money to friends or family around the world? Well, there are a few options, but Bitcoin ATMs are one of the most popular. These machines allow anyone to buy (or sell) digital currency with cash, and send it wherever they want — almost instantly!
There are three categories of people who don’t use bank accounts at all, or rarely.
These are adults who do not have a bank account at all, so they have no access to financial services. Sometimes a family member, such as a spouse or parent, might have a bank account — but the unbanked individual doesn’t use it. They might not have a job, or otherwise don’t keep enough money to warrant opening an account, or the financial institutions are not convenient or affordable enough. For these people, owning digital currency could be the only way to spend, or maybe even grow, the money they have.
These are people who have just the bare minimum of financial services, such as maybe a prepaid debit card or payday loan, but nothing else.