With world markets growing and technology and travel pulling us all closer together in an economic patchwork, too many people are sitting on the sidelines, idle. Most often, those on the sidelines are young people, women and families in extreme poverty.
They are the financially excluded.
Entrepreneurship – making your own job or starting a small business – is a real path forward for many. That’s why the Network for Teaching Entrepreneurship (NFTE) works to create and ignite an entrepreneurial mindset in disadvantaged young people around the world.
Understanding the power of ownership - of recognizing opportunity, planning and owning their future is powerful stuff. We know when the entrepreneurial fire is lit, they need access to the financial tools to capitalize on those opportunities and turn business ideas into businesses.
One of those tools is access to the most basic financial resources.
In many cases, the financially excluded don’t just lack access to seed capital and business loans, they don’t even have a way of issuing a paycheck, saving or safely paying an invoice.
According to the World Bank, only 37% of young people worldwide are accessing basic financial institutions. That number dips below 20% for young people from “low income” families. In 2011, just half of the world’s adult population had an account at a banking institution.
That means that more than 2.5 billion people are on the sidelines of the marketplace because they aren’t able to economically engage in a critical way. They are not financially included in the growing global marketplace or positioned to take full advantage of entrepreneurial ambition.
For those of us in the business of teaching young people to be entrepreneurs, this type of financial exclusion is a problem because of the close connection between entrepreneurship and financial inclusion.
It’s difficult to imagine a young entrepreneur anywhere in the world growing a successful business without the ability to safely buy and sell or save and invest. Teaching entrepreneurship and business skills to young people who lack access to financial institutions would be akin to teaching someone to farm – providing seeds and land but no tools to bring in the harvest.
At the same time, a young entrepreneur with a good idea and strong plan will inevitably seek out safer, faster and easier ways to run her business – wherever she is. Doing so brings her, her business, her employees and their families into a connected economy.
While teaching and inspiring more entrepreneurs around the world nudges them into secure financial and banking structures, banking tools must meet these emerging pioneers where they are.
This is a solvable problem and we have great partners doing exactly that.
Pushing to teach and inspire more entrepreneurs and pulling open the doors of accessible banking is important because no one knows where the
But it is clear that creating more entrepreneurs and expanding access to safe financial systems will bring more people into the global market. Which is good for everyone.
