BROWSE

Underbanked

Definition

The underbanked is a characteristic describing people or organizations who do not have sufficient access to mainstream financial services and products typically offered by retail banks and thus often deprived of banking services such as credit cards or loans. The underbanked are characterized by a strong reliance on non-traditional forms of finance and micro-finance often associated with disadvantaged and the poor, such as cheque cashers, loan sharks and pawnbrokers.

What is 'Underbanked'

A situation where an underwriter of a new securities issue has been unsuccessful in getting other firms to become members of the underwriting group or syndicate. As a result, the security will not be sold to as many clients as had been desired.

Explaining 'Underbanked'

An investment banker is underbanked when he or she is facing challenges in acquiring additional members for the underwriting group or syndicate for a new securities issue. If the originating investment banker is unable to find enough firms, he or she may not be able to underwrite the issue - and therefore would be unable to offer the security for sale.


Further Reading


Exploring the factors affecting the adoption of mobile financial services among the rural under-banked
aisel.aisnet.org [PDF]
… This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of … Journal of Financial Economics, 85, 234-266 … Mobile financial services and the underbanked: opportunities and challenges for mbanking and mpayments …

Technology enabled financial inclusion and evidence-based policy for the underbanked: A study of remote Indigenous AustraliaTechnology enabled financial inclusion and evidence-based policy for the underbanked: A study of remote Indigenous Australia
papers.ssrn.com [PDF]
… This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of … Journal of Financial Economics, 85, 234-266 … Mobile financial services and the underbanked: opportunities and challenges for mbanking and mpayments …

Exploring the factors affecting the adoption of mobile financial services among the rural under-banked and its implications for Micro-finance InstitutionsExploring the factors affecting the adoption of mobile financial services among the rural under-banked and its implications for Micro-finance Institutions
aisel.aisnet.org [PDF]
… This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of … Journal of Financial Economics, 85, 234-266 … Mobile financial services and the underbanked: opportunities and challenges for mbanking and mpayments …

Banking participation in the United States: an analysis of unbanked and underbanked householdsBanking participation in the United States: an analysis of unbanked and underbanked households
digitalcommons.unl.edu [PDF]
… This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of … Journal of Financial Economics, 85, 234-266 … Mobile financial services and the underbanked: opportunities and challenges for mbanking and mpayments …

Banking the Unbanked and Underbanked: RegTech as an Enabler for Financial InclusionBanking the Unbanked and Underbanked: RegTech as an Enabler for Financial Inclusion
onlinelibrary.wiley.com [PDF]
… This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of … Journal of Financial Economics, 85, 234-266 … Mobile financial services and the underbanked: opportunities and challenges for mbanking and mpayments …



Q&A About Underbanked


How can you avoid being "underbanked"?

The best way to avoid being "underbanked" is by building relationships with potential investors and making sure that they are aware of your services before you need them. This way, if you ever do need their help on a project, they will already know who you are and what your capabilities are.

How many people were estimated in 218 not to have a bank account?

About 1.7 billion adults lacked a bank account in 218.

What does it mean when an investment banker is underbanked?

When an investment banker is underbanked, he or she is facing challenges in acquiring additional members for the underwriting group or syndicate for a new securities issue. If the originating investment banker is unable to find enough firms, he or she may not be able to underwrite the issue - and therefore would be unable to offer the security for sale.

What is Underbanked?

A situation where an underwriter of a new securities issue has been unsuccessful in getting other firms to become members of the underwriting group or syndicate. As a result, the security will not be sold to as many clients as had been desired.

How does one define banked individuals who are excluded from financial services?

Banked individuals can be excluded from financial services.

What two things do those who are unbanked face discrimination for, according to the passage?

People who lack bank accounts often face discrimination because they belong to certain groups such as women or poor people in rural areas.

What does having more inclusive financial systems have been linked to stronger and more sustainable economic growth?

Having more inclusive financial systems has been linked to stronger and more sustainable economic growth.

What is financial inclusion?

Financial inclusion is defined as the availability and equality of opportunities to access financial services.

Why should I build relationships with potential investors?

Building relationships with potential investors will allow you access to more deals than if you were just randomly calling people out of the phone book trying to get them interested in investing in your company's stock offering. By building these relationships beforehand, when it comes time for your company's IPO (Initial Public Offering), they'll already know who you are and what kind of business experience that you have - which means that they're much more likely to invest in your company's stock offering because they trust that you'll make good decisions about how their money gets spent once it's invested into your company's operations.

Who are typically targeted by efforts to achieve financial inclusion?

Those who are unbanked and underbanked.

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