A number of scholars released the first report on global rural financial innovation: Global finance is deepening at an accelerating rate and China is leading the way
addtime:2021.09.26 | 分享至:

On September 15, China Grandview Institution joint Faculty of Economics and Business Universitas Airlangga of Indonesia and released Promoting Inclusive Finance through Fintech to Address Global Poverty as the first report of finance in agriculture and rural areas globally, with support from Nanyang Technological University of Singapore, National University of Singapore, the Institute of South Asian Studies and Vietnam Academy of Social Sciences, launching the “2021 Global Rural Financial Technology Innovation List”. It was remarkable that the satellite loan of MYbank was included in the list, which is the only rural financial innovation technology in China.


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The report pointed out that there is an unleashing potential in deepening financial inclusion beyond digital era when the Internet and mobile phone are becoming popular. And digital fintech (financial technology) should be placed a high value on rural poverty alleviation and economy development.

6 innovative applications on the list have several common features. All of them are from developing countries, and they were born in the past five or six years, even they have adopted the “mixing type innovations”, which means by using mature technology to apply to the farmers’ credit and precious experience for rural development and global poverty alleviation.


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In Kenya, M-KOPA has used solar energy to address farmers’ lack of personal credit. With M-KOPA, farmers can obtain the ownership of the entire solar system by paying US$0.5 per day for a year. The daily repayment also allows farmers to purchase TVs, refrigerators and smartphones or apply microcredit loans through their credit records on M-KOPA platform.


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In Mali, MyAgro has provided scratch cards to solve the problem of many people not having a bank account for lifetime.  Farmers can charge their change into scratch cards at any time and withdraw it when they need it. The “piggy bank” has so far helped nearly 100,000 Malian farmers to get rid of poverty trap of spending more without money.


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In India, Samunnati’s “QR code bank” allows users to apply for unsecured loans that are earmarked to purchase seeds and agricultural materials from selected merchants.


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MYbank satellite loan became the only innovative technology in China to make the list

The report singled out financial inclusion in China as one of the most striking examples of a developing country in the past 20 years. Under the Plan for Advancing the Development of Financial Inclusion, the banking system has been deeply involved and become the main body of China's rural finance.

Postal Savings Bank of China, for instance, had set up almost 40,000 branches at and below the county level by the end of 2020, making it the “bank with the best deepening degree”. Moreover, China Construction Bank (CCB), known as the “village bank”, has basically achieved full coverage of rural townships through cooperation with supply and marketing cooperatives.

In addition, a growing number of digital finance companies are also engaging in the wave of deepening finance. The list of MYbank was the first to use satellite remote sensing technology to farmers credit and loans, solving the bank to accurately obtain farmers’ assets. With the help of satellite images, farmers can clearly confirm the area of land, crop varieties, and growth span and yield on their mobile phones, while bank can decide whether and how much to loan to the farmer. It is reported that this technology bank initiated by Ant Group has served more than 20 million agriculture-related users so far.


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According to the report, China leads the world in terms of the number of agricultural-related users, participating financial institutions, technological innovation and loan scale.

Digital fintech is becoming increasingly important means of financing farmers globally. Therefore, further cross-border collaboration is needed to help more farmers in developing countries access financial services and reduce risk, the report added.


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