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How New Tech Is Transforming Finance In Emerging Markets | OilPrice.com

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How New Tech Is Transforming Finance In Emerging Markets | OilPrice.com

Whilst the worldwide economic system grapples with inflation, provide chain constraints and excessive commodity costs, new cost options are serving to billions in rising markets entry and deploy much-needed capital.

Pushed by a decline in money funds in the course of the Covid-19 pandemic, digital funds skyrocketed according to the expansion in e-commerce, because the monetary know-how (fintech) sector expanded to supply customers with a greater diversity of cost choices.

The expansion of digital funds has been strongest in rising markets, the place noncash retail funds elevated by a compound annual progress fee (CAGR) of 25% between 2018 and 2021, in comparison with 13% globally for a similar interval. A younger, tech-savvy inhabitants and demand entry to monetary companies are driving progress.

Digital funds are anticipated to proceed to develop globally, with a projected CAGR of 15% for 2022-26.

Fintech in rising markets has additionally drawn vital funding. Fintech operators accounted for 37% of the file $4.85bn in funding that African start-ups obtained in 2022 – the most important share of any sector.

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This progress, evident within the uptake of cryptocurrency and microcredit fashions equivalent to “purchase now, pay later” (BNPL), serves to develop monetary inclusion whereas reshaping the way in which customers faucet into capital inflows.

Boosting monetary inclusion

Based on the World Financial institution, some 1.4bn adults remained unbanked as of July 2022. Banking penetration has elevated considerably in recent times, nonetheless, with 76% of adults gaining access to a checking account globally, in comparison with 51% a decade in the past.

The digitalisation of monetary companies has been integral to increasing monetary inclusion, in addition to diversifying the sector. The recognition of digital cost strategies has benefitted non-traditional monetary actors as properly, with nonbanks proudly owning the dominant front-end cost utility in international locations like India, Kenya, the Philippines and Vietnam.

One such mobile-enabled system, India’s Unified Funds Interface (UPI), has helped digital funds within the nation rise by 50% over every of the previous 5 years. In March the Reserve Financial institution of India debuted a UPI for characteristic telephones, a growth that might doubtlessly carry monetary companies to an estimated 400m individuals in rural areas.

One other well-liked cellular cash system, M-Pesa, permits customers to make funds and retailer and obtain funds through their cell phones, granting entry to monetary companies in areas the place banks shouldn’t have a presence. The service is utilized by 51m individuals throughout seven African international locations and is ready to develop into Ethiopia following a licence approval in October 2022.

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Revolutionary cost strategies are even serving to to supply extra accessible and reasonably priced well being care to customers in rising markets. Nigeria’s Soso Care, for instance, accepts recyclable waste equivalent to scrap metallic, plastic or automobile batteries in change for well being protection, in search of to bridge the care hole and deal with waste disposal in a rustic the place 23% of the inhabitants has medical insurance.

Digital forex developments

Blockchain-powered fintech, particularly cryptocurrency and non-fungible tokens (NFTs), provide decentralised exchanges that allow transaction flows regardless of macroeconomic pressures equivalent to rising US rates of interest and inflation on fiat currencies world wide.

Because of these benefits, rising markets are main the uptake of cryptocurrency regardless of the worldwide bear market: 10 of the top-20 international locations on the 2022 World Crypto Adoption Index revealed by blockchain information platform Chainanalysis have been categorised as lower-middle-income international locations, whereas eight have been higher center earnings.

Vietnam ranked first on the index, due partly to the recognition of cryptocurrency-based gaming platforms that use play-to-earn fashions. The Philippines, Ukraine and India held the second, third and fourth spots, respectively.

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NFT marketplaces equivalent to FanCraze, a platform that sells cricket NFTs and has monetary backing from US enterprise capital agency Sequoia Capital, are credited with India’s rise on the index.

Regardless of sharp declines in worth, Bitcoin was adopted as authorized tender by the Central African Republic in April 2022. Egypt, Kenya, Nigeria and South Africa, Africa’s four-largest economies, additionally boast the most important variety of cryptocurrency holders on the continent.

Uptake of central financial institution digital currencies (CBDC) has additionally grown as governments try and navigate the burgeoning digital forex panorama. As a digital type of money issued and controlled by central banks, CBDCs are seen as much less unstable than cryptocurrency belongings. Greater than 100 CBDCs have been in growth levels world wide as of mid-2022, with Nigeria’s eNaira debuting in October 2021 and the Bahamas’ sand greenback launched the yr earlier than.

Hoping to develop their fiscal attain and make up for funding shortfalls, various African nations have levied taxes on digital transactions.

In Could 2022 Ghana rolled out a 1.5% tax on the switch quantity of digital transactions. Regardless of client criticism and a resurgence in cash-based transactions, the measure could also be encouraging formalisation by driving companies to register with the Ghana Income Authority, thereby broadening the nation’s tax base.

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Funding resilience

Various cost options play a key function in constructing monetary resilience in rising markets, the place battle, inflation and pure disasters can have an outsized financial affect.

Lengthy seen as an impediment to progress and a drain on public funds, the casual economic system could play an necessary function in financial resilience.

The Worldwide Labour Organisation estimates that some 2bn staff over the age of 15 spend a minimum of a part of their working lives within the casual sector.

Casual companies, often micro-, small and medium-sized enterprises (MSMEs), contribute to the formal economic system via quite a lot of methods, equivalent to value-added taxes on purchases or the incidental prices of working a enterprise.

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The casual economic system represents a extremely dynamic type of employment, offering jobs, expertise and earnings to massive swathes of the inhabitants in lots of rising markets, the place it accounts for roughly one-third of financial exercise.

For a lot of MSMEs, restricted entry to credit score stays a significant impediment to progress and formalisation.

Based on the Worldwide Finance Company, some 65m companies – roughly 40% of all MSMEs – face an annual funding hole of $5.2bn, indicating a sizeable alternative for fintech operators.

One current fintech innovation, BNPL, is already unlocking e-commerce potential in rising markets and has the potential to slender the credit score hole for MSMEs.

BNPL companies provide point-of-sale loans that may be repaid in instalments, usually with little to no curiosity. The system helps retailers entry markets with restricted entry to financing, and might improve the buying energy of customers and MSMEs alike.

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A number of markets within the Asia-Pacific area are prefer to see a BNPL increase, with a 2021 Google report projecting digital-lending balances within the area to succeed in $116bn by 2025.

In mid-2022 GoTo, Indonesia’s greatest start-up, introduced plans so as to add a BNPL service to its wide-ranging portfolio, which incorporates e-commerce and ride-hailing.

Fairbanc, one other Indonesian agency, affords business-to-business BNPL companies to MSMEs, permitting them to purchase stock utilizing BNPL credit score, and decreasing the technological and monetary boundaries to collaborating within the digital ecosystem.

Remittances are one other key supply of earnings for a lot of in rising markets, with volumes on the rise in recent times. Based on the UN’s Worldwide Fund for Agricultural Improvement, an estimated 800bn individuals globally profit from remittances, which assist increase monetary resilience within the face of inflation and pure disasters, equivalent to this yr’s flooding in Pakistan and West Africa.

World remittances to low- and middle-income international locations grew by 5% to $626bn in 2022, decrease than the ten.2% improve seen in 2021 however nonetheless vital contemplating world macroeconomic pressures.

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By Oxford Enterprise Group

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City of Lawton Finance Director resigns, search underway to fill role

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City of Lawton Finance Director resigns, search underway to fill role

LAWTON, Okla. (KSWO) – The City of Lawton has announced the resignation of Finance Director Joe Don Dunham.

In a statement sent to 7News, city officials say that Dunham tenured his resignation back on March 28.

The city also stated that a search to fill the vacancy is currently underway with Kristin Huntley serving as the Interim Finance Director.

We will bring you updates as we learn more.

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When You’re Laid Off But Still Have to Go to Work

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When You’re Laid Off But Still Have to Go to Work

Photo-Illustration: by The Cut; Photo: Getty Images

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When layoffs happen, they’re often immediate — former employees are shown the door and locked out of their company email within hours. Others are given a few days to tie up loose ends. But in a few cases, the good-byes drag on … and on and on. Sometimes laid-off workers have to stay on for weeks if they want severance and even train their replacements themselves. It’s awkward! Still, you’re getting paid just to keep showing up. Here, three laid-off women share what they did — and didn’t do — with the extra weeks they had to hang around their old jobs.

At the beginning of December, we all woke up to an email that was like, “The company’s closing in three weeks.” I think it went out at 7 a.m. on a Monday. Everyone came into the office and met with their bosses. And then it was basically several weeks of intense senioritis. No one was working hard or doing much of anything. People were openly interviewing for new jobs at their desks. You’d walk by and hear someone being like, “Well, my strengths are …” Everyone was like, “Who are you talking to? Do you know anyone hiring?” There was a sense of solidarity, and no one gave a shit anymore. Even our bosses were getting laid off, so there wasn’t anyone to be mad at — I mean, maybe extreme upper management, but they weren’t in our office.

It was a weirdly fun time to be at work. All the guise of professionalism was gone. We were all in the same boat, using that time to network and stealing company swag. Within a few days, the office supply closet was completely bare. All I managed to get were some mugs and pens.

They also gave us really good severance — six months of full pay. I wound up having a new job lined up before our last day. Frankly, I don’t think anyone was really that surprised that we were closing. It was a start-up and terribly managed, and they just threw money at everything. At the beginning, they were flush with VC cash, and we could do whatever we wanted — I’d pitch a project that would require me to fly across the country, and they’d be like, “Okay!” It was clear that it wasn’t going to last. There was almost this sense of having gotten away with something.

Five weeks ago, a meeting was put on my calendar on a Friday to discuss changes within my organization. I knew that layoffs were coming at some point — our chief marketing officer had told us a few months ago — but I didn’t think I’d be affected. They’d hired a consulting firm to go through and “streamline” certain departments, but if anything, I thought I’d get good news. I’d built a lot of relationships in my role, and I’d heard that the team I managed, which consisted of 20 people, might be expanding. So I got on the meeting — we’re mostly remote — and made some stupid joke and then I saw my manager looking terribly sad. And they said my role had been eliminated and my team would be decentralized. My boss was sending me text messages the whole time like, “I’m so sorry, I had no idea.”

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Come Monday, I found out which members of my team had been laid off too, and was completely shocked. One was a top performer. There were huge cuts across the company, almost at random. But no one knew who was safe and who wasn’t, which created more gossip. I got a call from a colleague who was like, “Oh my gosh, it’s a bloodbath.” He started listing all these people who were being let go. And I was like, “Yeah, and me too.” He couldn’t get off the phone fast enough.

Some people were dismissed immediately; others were given two weeks. They gave me five weeks, which I think was an attempt to be nice. But is it nice? It seems like they picked my final date based on the end of the quarter, so that they wouldn’t have to budget for my salary next quarter. Ultimately, it was just very awkward. I care a lot about my team, and I wanted to try to help with the transition as much as I could. But five weeks is a very long time to be hovering and feeling useless, the object of people’s pity. My end date was conditional — I had to stay for that five weeks if I wanted my severance package — but toward the end, I was just hanging around. During my last week, I got an automated email from the company congratulating me on my two-year work anniversary.

I stopped setting an alarm in the morning. If somebody needed me, they knew how to reach me, but I was only working for about two hours each day. There just wasn’t that much for me to do. I live near Disney World, so I went there a fair amount. I did a lot of reading. I went to 4:30 p.m. pilates classes. I’ve been looking at my LinkedIn. I trained for a 10K. I spent more time with my friends, and my dog got a lot of exercise. With my severance package, I technically don’t have to work for the rest of the year. Hopefully I find something new before then. But I also need some time to mend from this experience. I know I was valuable here, but they didn’t care — I was just a number on a spreadsheet.

I’d planned to send out a nice farewell note and put up an out-of-office message on my last day. But then, after I had five weeks to plan it, I got cut off from the system early, before I could do it. After all that, I didn’t even get to say good-bye. Now I just have to mail in my laptop.

When I was laid off and told that my last day would be in a month, I was in such shock that my immediate response was Maybe if I work extra hard before my last day, they won’t actually let me go. It was like a bad breakup where you hope you can change their mind. I had just turned 30 and gone through an actual bad breakup with my college boyfriend, too, so I was grappling with my self-esteem on multiple fronts.

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Not that I even considered it, but if I’d left before my end date, I would just get two weeks of severance. So the choice was either get paid for six more weeks or two more weeks — sort of a no-brainer. I was looking for a new job the whole time, but I was also still working my butt off. I stayed in this denial phase that maybe, if I proved myself, they’d be like, “Oh, we’ll keep you on for one more month, and another month after that.” It was delusional.

Some people have the intuition that they’re getting let go. I did not. I was never really given a reason. It seemed like a weird mismanagement issue, though I never really got to the bottom of it.

After I talked to HR, I went back to my desk. I sort of assumed my boss would say something, but she didn’t. So I waited for maybe an hour and then was like, Fuck this, I’m going home. Then I went out with a friend and got really, really drunk. The next morning I was so hungover, but I went into work anyway. And for the next few weeks, I was just trying to do everything as perfectly as possible. There was actually a lot of work to do. I had to finish up all of my deliverables and create a handover memo for all my responsibilities. I was also trying to be strategic. I figured that everyone I worked with might hopefully be a reference for me someday. So I wanted to be in everyone’s good graces.

I had a lot of access to free products at my job, but I didn’t take anything. I was honestly too nervous. I downloaded my contacts and some of my work off the company server, and I even felt guilty about that, which I know I shouldn’t have. At one point I asked my boss if we could say that I was leaving — not that I had been laid off — and she was like, “No.” She was not interested in being remotely helpful. Looking back, I’m so glad I got out of that job. It was such an awful workplace. And it’s wild to me that I was so desperate to stay for as long as I could.

Email your money conundrums to mytwocents@nymag.com (and read our submission terms here.)

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Japan committed to act appropriately on weak yen: finance minister

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Japan committed to act appropriately on weak yen: finance minister

Finance Minister Shunichi Suzuki said Thursday there is no change “at all” in the Japanese government’s stance that it will act appropriately to address the weakening of the yen after it slipped past 155 to the U.S. dollar

Speaking in parliament, Suzuki said the government is carefully monitoring currency market developments but declined to comment further, amid market vigilance over a possible yen-buying dollar-selling operation to slow the Japanese currency’s fall.

“We are closely watching market developments. There is no change at all in our resolve to respond appropriately based on this,” Suzuki said.

The finance chief has repeatedly issued verbal warnings about the yen’s volatility, threatening to take appropriate action without ruling out any options.

Still, his latest comments did not suggest a change in tone, days after he said conditions were being set for “appropriate” action, without giving further details. Japan previously stepped into the currency market to arrest the yen’s sharp drop in late 2022.

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Japan’s top government spokesman Yoshimasa Hayashi reiterated that currency moves should be stable, reflecting economic fundamentals.

“We are of the view that excessive fluctuations are not desirable. The government will be closely watching market developments and take all necessary steps,” said Hayashi, the chief Cabinet secretary.

The yen’s depreciation reflects a wide interest rate gap between Japan and the United States.

The Bank of Japan, which holds a two-day policy meeting from Thursday, raised interest rates for the first time in 17 years last month but the central bank is not expected to rapidly push rates higher and it has underscored the need to continue accommodative financial conditions.

The U.S. Federal Reserve, meanwhile, is now expected to cut interest rates later than initially thought, boosting the dollar further.

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A weak yen inflates import costs, which contributes to higher inflation in Japan.


Related coverage:

Yen drops to 155 range, new 34-year low against U.S. dollar

BOJ to check effects of rate hike amid weak yen at policy meeting

Nikkei stock index surges over 2% on tech gains

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