Unbanked refers to those that are either unable to access banking services, or choose not to.
What Does Unbanked Mean?
Unbanked refers to individuals who remain unable to access basic banking products and services, most of them coming from marginalized sectors of society, and thus, rejected by traditional financial institutions for various reasons. The unbanked also includes people who have chosen not to use banks or other traditional financial services.
In many cases, most of the unbanked are poor individuals who can not afford nor fulfill the requirements of opening a bank account. Despite governments’ efforts in working on developing new financial products that can help reach out to unbanked populations through microfinancing and other methods, many banks continue to deny low-income customers for not having enough resources.
It is the collective goal of the crypto ecosystem to promote financial inclusion via digital assets, smart contracts, and other forms of blockchain technology. Bitcoin and DeFi projects are by far the most promising solution to the unbanked as they offer innovative new applications that mimic traditional financial products and services that are freely accessible to all.