So what is financial exclusion in the era of Open Finance?
Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: ESG, Financial Inclusion, Sustainable Finance
So what is financial exclusion in the era of Open Finance?
Fintech Galaxy | Lisa Gutu | Jan 19, 2022
So what is financial exclusion in the era of Open Finance?
Despite the impact of the phenomenon, little is known about which categories are excluded from the financial market. These are usually classified as follows:
Unbanked – individuals or organisations who don’t have any access to a bank’s or financial institution’s services.
Underbanked – individuals or organisations who have limited access to financial services and still rely on using cash in most operations, thus depriving themselves of important banking services, like using credit cards or getting loans.
See: Minister Freeland releases final report with 34 recommendations on Open Banking from the Advisory committee
Underserved – this is a term used to describe the two aforementioned categories: the unbanked and the underbanked. Underserved communities are most often from:
- People with low incomes from low and middle-income countries;
- People with low incomes or who are marginalised in high-income countries;
Women and expats in several parts of the world; - Micro businesses – although MSMEs constitute a high percentage of the total number of businesses in the world, financial exclusion is the main constraint keeping them from developing.
Financial exclusion doesn’t affect only the developing countries. It involves the difficulty in accessing and using all those financial services necessary for the complete development of the daily life of individuals and to their full involvement in society.
Unbanked and underbanked individuals are located across the world in both wealthy countries and undeveloped countries. According to data from the World Bank, as of 2017 — the most recent year for which figures are available — 1.7 billion people were unbanked globally.
See: Banking barriers: How the Canadian financial sector excludes Black entrepreneurs, stifling innovation
Younger people are also more likely not to have bank accounts or to be underserved by banks than older people. Around 30% of unbanked people were between the ages of 15 and 24 in 2017.
Underserved communities are most often from:
- People with low incomes from low and middle-income countries;
- People with low incomes or who are marginalised in high-income countries;
Women and expats in several parts of the world; - Micro businesses – although MSMEs constitute a high percentage of the total number of businesses in the world, financial exclusion is the main constraint keeping them from developing.
Open banking is meant to generate new benefits and opportunities for economies and societies by:
Providing access to responsible credit. Properly designed open banking products, through the use of alternative financial data, can expand access to financial insights that help increase consumers’ chances to get approved for loans and accurately assess what they can afford. Such data can include mobile bill payments, rent payments, utility bill payments, and so on.
See: Open Finance data adoption varies by country (but one thing is certain)
Enabling participation in the global economy. Open banking is spurring economic growth and driving financial inclusion by helping millions upgrade from cash-based transactions to digital financial transactions in a secure environment.
Supporting MSEs. Micro and small enterprises get access to affordable financial tools that address their needs including accounting and cash management. These processes become automated under open banking and easier to achieve from a technical point of view.
Supporting the contingent workforces. Freelancers have been underbanked for a long time, and with all the open banking-based opportunities, this is changing. They get access to affordable financial products and benefit from nano-loans and micro-insurance, which is exactly what they’ve lacked up until now.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Canadian securities regulators publish guidance on ESG-related investment fund disclosure
CSA Release | Jan 19, 2022
Toronto – The Canadian Securities Administrators (CSA) today published guidance for investment funds on their disclosure practices that relate to environmental, social and governance (ESG) considerations, particularly funds whose investment objectives reference ESG factors and other funds that use ESG strategies (ESG-Related Funds).
The guidance is based on existing regulatory requirements and addresses areas of disclosure, including investment objectives, fund names, investment strategies, risk disclosure, continuous disclosure and sales communications.
See: New SEC task force will scrutinize ESG and climate disclosures and marketing
As the investment fund industry creates new funds and incorporates ESG considerations into existing funds to meet demand, there is an increased potential for “greenwashing” – where a fund’s disclosure or marketing intentionally or inadvertently misleads investors about the ESG-related aspects of the fund.
“Interest in ESG investing is on the rise and this enhanced and practical guidance will play an important role in helping investors make informed decisions about ESG products, as well as preventing potential greenwashing,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers.
This guidance is intended to help investment funds and their fund managers enhance the ESG-related aspects of the funds’ regulatory disclosure documents and ensure that sales communications of ESG-Related Funds are not untrue or misleading and are consistent with the funds’ regulatory offering documents.
The guidance follows the CSA Roundtable on ESG-Related Regulatory Issues in Asset Management, which was held on September 27, 2021.
See:
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Regulators target “greenwashed” products susceptible to marketing hype
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Alternative forms of capital will be key to develop sustainable economic systems
As part of its ongoing continuous disclosure review program, the CSA will continue to monitor the ESG-related disclosure of funds.
The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.
Download the 27 page PDF guidance report --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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US government to address the ramifications of cryptocurrencies on Jan 20th -> Tune in here
FinBold | | Jan 16, 2022
The Bitcoin mining sector has piqued the interest of several countries over the last year, and it appears that the United States government is starting to become interested in this market.
As a result, a hearing has been scheduled in the US to explore the ramifications of the energy consumption incurred by cryptocurrency mining operations. Indeed the Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will conduct a public hearing on the subject next Thursday, January 20, according to the House Committee.
“The Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will hold a hybrid hearing that includes both in-person and remote attendance on Thursday, January 20, 2022, at 10:30 a.m.”
See: Landmark Jury Verdict Finds Digital-Asset Products Linked to Cryptocurrency Mining Are Not Securities
The investigation is titled “Clearing Cryptocurrency: The Energy Implications of Blockchains,” and in particular, the Subcommittee is interested in learning about the energy consumption of blockchains, with the premise that they may create environmental concerns in the future. On the scheduled day, the hybrid hearing will also live stream on YouTube.
Congress’ energy subcommittee to discuss cryptocurrency
Bitcoin has gone through a lot of ups and downs in its short existence of just 13 years; however, one of the most recent efforts to discredit this technology is predicated on the fact that it is energy-intensive.
Proponents of Bitcoin argue those who oppose digital currency have not considered the costs of technology compared to the conventional banking system or the energy required to transport paper money across the globe.
US crypto mining growth
In response to the rapid expansion of US mining businesses after China’s mining prohibition, the local mining industry organized the formation of a Mining Council in 2021, which is overseen by the likes of Michael Saylor and Elon Musk.
See: Arcane Research: Summary of Crypto 2021
Watch the live stream on January 20th: Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Alternative forms of capital will be key to develop sustainable economic systems
Fintech Confidential Issue 4 | Éliane Ubalijoro, PhD | Jan 13, 2022
A year and a half into the COVID-19 pandemic, the global economy is looking cautiously at recovery. According to the World Bank, growth will be very uneven given surges of virus variants, patchy vaccination rates, and withdrawal of government support measures, so global GDP in 2021 is still expected to be 3.2% below pre-pandemic projections. To support a more equitable and sustainable recovery, it is imperative that our economic systems recognize how they need to be underpinned by "flourishing communities, strong and resilient social institutions, thriving natural ecosystems and a stable climate” as the Capitals Coalition articulates. As a member of their supervisory board, I truly believe that we must empower organizations to understand that their success and the success of the global economy more broadly is fundamentally dependent on natural, social, and human capital, in addition to produced capital.
We must work to curb greenhouse gas emissions in all the ways we produce goods and services, whether it is how we impact, air quality, energy management, water quality, how we reduce waste streams and maximize circular economies to minimize our ecological footprint. We must ask ourselves how are we valuing the rights of all people and nature, how are balancing our need for privacy and need for security, how are we making sustainable goods and services accessible, affordable and producible by all, not just some. It is time to consider product passports that standardize the ability to assess carbon footprint through a products lifecycle to help customers make buying choices that support planetary health. It is also important to ensure labor practices that favor employee health, safety, inclusion, diversity and equity.
It is time to enable that our businesses, financial institutions and governments include the value of all forms of capital in their decision-making, especially as countries face their commitments to the Paris Climate Agreement and United Nations 2030 Sustainable Development Goals.
And this is where there is huge potential to leverage digital technologies and increasingly, financial technology (fintech) to support a capitals accounting approach and to develop stronger ESG (environmental, social, governance) metrics in support of more sustainable investments.
For example, AgriLedger’s work in Haiti is very inspiring. This agricultural-focused blockchain systems provider is piloting a project to use blockchain technology for traceability and payment that will allow the farmer to maintain ownership until the sale at final destination, while all the packing and logistics services will be provided by AgriLedger. This mechanism scaled globally would give more power and improved livelihoods to farmers while minimizing waste streams as produce lifecycle management ensures maximum contribution to value chains as well as composting waste to increase soil health. CarbonX, a Canadian fintech-designed environmental software, enables users to calculate the carbon impact of their products and services and to offset this through investments in carbon mitigation projects carefully evaluated not only for their environmental impact but also for their social and economic impacts. Open Climate is a collaborative project led by the Open Earth Foundation, an non-profit organization operating globally and based in the United States. The project explores the potential application of a range of digital technologies to developing a transparent, global, integrated climate accounting system and aims to co-develop a decentralized ‘ledger of ledgers’ to collect and share climate data from around the world, balancing transparency and privacy.
Even with all these excellent examples, it is critical that the tools and technology are not developed in a black box. In order to have mechanisms such as stronger ESG metrics that can potentially transform investments and truly increase accountability, it is critical to first build trust. Trust in the metrics and trust in the technologies underlying the development of those metrics. By creating more inclusive, collaborative approaches to probe the assumptions underlying the algorithms used to develop ESG metrics, trust and common standards can be agreed upon.
Another barrier to overcome is the complexity of the systems at play
There is a dichotomy between technological literacy and education to build technological capacity on the one hand, and over-complexification of digital systems on the other hand. More of an effort must be made in order to de-complexify technology to some extent. This will avoid the development of what colleagues have referred to as “technological expertocracy” – or the continued development of a group of elites who have access to and understanding of the incredibly complex systems underlying the digital infrastructure that increasingly dictates our lives and is shaping fintech. A lack of trust in digital technologies or in the experts who develop and control them can create huge barriers to implementation, scaling, enabling policy frameworks and impact in terms of addressing systemic challenges such as climate change.
Related to this, there is a strong need to develop more human-centric technologies – including fintech. Engaging citizens more directly could be a positive way forward here, both to build trust and also to ensure that technologies are addressing biases, reflecting shared values, allowing more equity in access and incentivizing collaboration as opposed to increasing division.
And efforts are being made. For example, our initiative, Sustainability in the Digital Age, convenes leaders in business, government, science, and civil society to explore how to consciously steer the societal transformations unfolding from the development and deployment of new digital technologies, towards equitable and sustainable paths. Similarly, the Global Commons Alliance has been inviting all stakeholders interested in accounting and standard setting that considers ESG, to come together and work at shaping a co-creative space to align everyone. The international Coalition for Digital Environmental Sustainability (CODES) is an open multi-stakeholder community of change makers and practitioners that seek to collaborate in accelerating a digital planet for sustainability.
So the momentum is here, and collaboration is critical to unleashing the transformative power of digital technologies in an inclusive approach that values not just profit making but also our collective contributions to natural, social and human capital for planetary health.
Authored by:
By Éliane Ubalijoro, PhD (LinkedIn)
Sustainability in the Digital Age, Executive Director
Future Earth, Global Hub Director (Canada)
This article is featured in NCFA's digital magazine, Fintech Confidential (Issue 4). Click to read the latest thought leadership, insights and trends about Fintech in Canada:
Checkout NCFA's digital magazine, Fintech Confidential (Issue 4) --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Gensler’s Updated Regulatory Agenda Critized by SEC Commissioners Peirce and Roisman (Exempt Securities)
Crowdfund Insider | | Dec 13, 2021
SEC Commissioners Hester Peirce and Elad Roisman have once again voiced their concern regarding SEC Chairman Gary Gensler’s regulator agenda – a list that was recently updated.
Last summer, Gensler published his regulatory agenda and now an update is available. When Gensler posted his initial goals, Commissioners Peirce and Roisman issued a statement criticizing the list of rules and regulations the Gensler Commission was seeking to address. Today, the two Commissioners are once again expressing their disappointment in Gensler’s agenda.
The two Commissioners have posted a statement labeled “Falling Further Back” calling Gensler’s agenda “ambitious in scope” but failing “to include any items intended to facilitate capital formation.”
“Instead, the agenda is brimming with plans to redo recently completed rules, add new regulatory obligations, and constrain investor choice,” chastised the two Commissioners.
At the very top of Gensler’s list (once again) are exempt securities offerings as well as a change to the definition of an accredited investor – a move that would most certainly aspire to limit access further to private securities.
See:
More regulation coming: SEC Chairman signals stablecoins and other tokens could fall under its rules on security-based swaps
Hester Peirce on personal liberty, crypto regs and retail investor particiation
Hester Peirce: Lawless in Austin
To quote the statement but the Commissioners:
“One example is the proposal to alter the thresholds at which an issuer is required to register a class of securities with the Commission. In 2012, Congress enacted the bipartisan Jumpstart Our Business Startups (a.k.a., the JOBS Act), which, among other provisions aimed at improving capital access for newer companies, specifically raised these thresholds in order to allow companies greater flexibility in deciding whether and when to go public. This provision has been especially important for pre-IPO companies that use equity as part of their employee compensation arrangements and for startups in industries with high initial capital requirements. Lowering these thresholds may both contradict the express will of Congress and potentially undermine our mission to facilitate capital formation. A likely unintended consequence of lowering thresholds will be to limit the opportunity of employees, smaller investors, and other non-institutional investors to invest in promising businesses.”
Continue to the full article --> here
View the statement by the commissioners --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Canada’s Low-Carbon Tech opportunity is now or risk another familiar story
BCG | Jason Green, Vinay Shandal, Wendi Backler, Keith Halliday, and | Dec 7, 2021
First the good news. A global study of private investment by Boston Consulting Group’s Center for Growth and Innovation Analytics found that Canadian ventures are well represented across 13 key low-carbon tech sectors. HTEC, Svante, Amp and Li-Cycle, for example, all attracted major funding over the past 12 months, making 2021 a banner year for private investment in the country’s low-carbon tech industry.
As much as US$21 trillion in new investment in both mature and newer low-carbon technologies will be needed globally over the next ten years.
In addition, Canadian low-carbon tech ventures are attracting a greater mix of investment in carbon capture, hydrogen, biofuels and climate analytics than their peers in Europe, the US or Asia-Pacific. BCG data shows they have claimed 8% or more of private investment worldwide since 2016. This is a hefty multiple of Canada’s roughly 2% share of the global economy. (See Exhibit 1 above.)
See: Decarbonizing Crypto: Getting to the facts of the decarbonisation discussion
However, Canada’s history with past tech shifts suggests that while our venture record is strong, our scale-up record is poor. After a generation of internet innovation, for example, Shopify is the only Canadian company on the list of scale-ups with market capitalizations of more than US$50 billion.
Historically, a major reason has been a lack of sustained attention and investment from Canada’s public and private sectors.
BCG research shows that 80% of Canadian private investment—across the corporate sector, venture capital, private equity and financial institutions—currently goes to ventures located outside Canada.
It will be a regrettable irony if Canada ends up importing key low carbon tech from other places instead of fanning a booming economy in an area where we have already cultivated significant home-grown advantage.
See: Are the new carbon offset ETFs too simplistic of a solution?
To help young businesses achieve scale, Canada’s public and private sector should take three steps.
- The first is for corporate Canada to ramp up venture investments and partnerships.
- The second step is for Canadian companies and government agencies to host more demonstration projects and at-scale deployments domestically.
- The final opportunity is to improve the innovation environment in Canada. To win the low-carbon future, we must get serious about addressing tax issues, low levels of corporate R&D, access to risk capital, and the brain drain of talent to the US.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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RBC Research: Preparing for Hyperdrive – Themes that will define our new future
RBC Wealth Management Research | Dec 7, 2021
Get ready for accelerated disruption. As we think forward to the future, progress will be faster than it has ever been and it will not be linear. Just as we did in our Landmark 2018 Imagine Report, in this thought leadership study we have taken a global, cross-sector approach to determining the themes that will define our new future.
Challenging our global research teams in their respective areas of expertise and coming together to share ideas in recent months, we identified five key themes investors and executives alike across all industries must collectively understand to prepare for the years ahead.
Themes that will define our new future
1. The Quest for Immortality – Biopharma breakthroughs, life science real estate, 5G, autos, consumer wellness, space exploration and more come together to increase life expectancy rates globally.
2. The Individual Revolution – Data monetization, blockchain, gene editing and an evolving gig economy put the individual front and center like never before.
3. Artificial Intelligence Activated – This is no longer a drill. The path is set for the latter stages of AI to be integrated into our global economy. Don’t be left behind.
See: WEF Insight Report: Digital Assets, Distributed Ledger Technology, and the Future of Capital Markets
4. Hybrid Living – Our physical and digital worlds are rapidly combining, suddenly becoming indistinguishable and the implications are radical.
5. The Great Balancing Act – An accelerating rate of change on multiple fronts has the potential to create unprecedented instability. Resources are constrained and as we make tremendous forward progress on global sustainability, we must always keep in mind the other side of the coin. Innovation will thrive and new tensions will arrive.
In conclusion, the five themes highlighted in this thought leadership study provide a glimpse into the future and the opportunities and challenges that lie ahead. Life science, in particular, plays a significant role in the first theme, "The Quest for Immortality," as breakthroughs in biopharma and gene editing are increasing life expectancy rates globally. As we prepare for accelerated disruption, it is essential to collectively understand these themes and continue to learn more about the implications and potential opportunities they bring.
By staying ahead of the curve and embracing change, we can pave the way for a brighter future. This requires us to be open-minded and flexible in our approach to new technologies and ways of working, as well as actively seeking out knowledge and insights from a variety of sources. Only then can we truly harness the power of disruption to drive innovation and progress.
Download the 263 page PDF RBC Research report --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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