Americans Must Be Able to Access Fintech

Approximately two-thirds of the U.S. population currently is being urged to stay home in the face of the COVID-19 pandemic. With their mobility restricted, housebound families have turned to apps to get them through this unprecedented period. These technology-based tools facilitate the delivery of groceries, meals and basic household items, help children learn and allow parents to hold kitchen table conference calls. This is the new normal for the foreseeable future.

Beyond the disruption to our everyday way of life, unimaginable economic hardship has befallen many individuals and small businesses across the country. In mid-March, about a quarter of a million Americans filed for unemployment benefits for the first time. A week later that number was almost 3.3 million.

Exacerbating that suffering is the fact that, with large portions of the country living under self-isolation or quarantine, access to physical financial services providers is increasingly limited or impossible for many Americans. Workers who still are getting paychecks might even be worried about going to an ATM or to a bank branch (most of which have been deemed as essential services during the crisis) for fear of contracting the coronavirus.

Here, too, technology can help. Many Americans now live their entire financial lives using just a laptop or smartphone. Technology-powered tools have served during this time of hardship as the primary form of access to the financial services system for millions of individuals, families, and small businesses. 

These tools are most important for the most financially vulnerable. An-oft cited but stark statistic from the Federal Reserve’s annual national economic study found that nearly half of Americans could not cover the cost of a $400 emergency expense.

Access to financial services products and services has never been more vital for consumers and small businesses than it is right now. As Federal Reserve Bank of Boston official Jay Lindsay explained in late 2018, “A lot of it begins with mobile devices, which are increasingly common across income levels and a lot easier to access than the bank branch across town. A mobile device can help a person sign up for a service that tucks away a few dollars a week into an emergency account. Or it could connect someone to a broader pool of lenders who use additional types of data to help underwrite and extend credit with better terms and interest rates than were traditionally available.” He concluded, “Fintech makes services more efficient and scalable for both a company to deliver and a customer to receive, so the pool of available customers and profitable services widens.”

Demand for fintech products and services will only grow over the coming weeks and months. The entire financial ecosystem, and the government, must work together to ensure these tools actually will work for consumers, and remain secure and safe in the face of a global crisis. Allowing consumers and small businesses to have the full opportunity to use and access fintech tools might not eliminate all of their current anxiety (that’s impossible right now), but it will give them a much-needed sense of control — and access to vital financial products and services — during this unprecedented time.   

The fintech industry stands ready to work with banks and government officials. News stories abound about how education technology companies have stepped in to help the growing number of students who are learning from home. Less known is how the fintech community has responded. Fintechs are providing American consumers and small businesses with critical access to much-needed capital. They also are offering flexibility and relief with respect to existing financial obligations, valuable investment guidance to consumers during a time of significant market volatility, and a holistic view of their finances.

Today approximately 100 million Americans rely on at least one fintech tool. As consumers and businesses struggle to maintain their financial wellbeing amid economic disruption, these tools have never been more indispensable. Fintech already plays a role in millions of Americans’ financial lives, and it is time to formally recognize it as part of this critical infrastructure.


Steve Boms is executive director of the North American arm of the Financial Data and Technology Association, a trade association coordinating the campaign for the delivery of Open Banking across the globe.

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