Financial Regulation International
Optimising the modern digital economy for effective financial inclusion: Part II
Aiya Al-Jabiri and Sara Alqamish
The modern digital economy has expanded the boundaries of financial engagement, requiring innovation to engage a larger section
of individuals, and particularly the underserved members of the population; this has exposed the need for a more robust framework
by which the benefits of the digital economy can be optimised to ensure extensive financial inclusion. Optimising this digital
economy requires a wide range of measures to curtail the misuse of user information while ensuring that an operational structure
is put in place. Increased digital adoption would consequently result in extensive financial inclusion and the resultant data
collection, particularly amongst a demographic (the unbanked/underbanked) who have little awareness of the potential risks
concerning their data would require a stronger data protection legal and operational framework. It is notable that individuals
who use formal finance mediums for the first time are particularly vulnerable to this data misuse by the data controllers,
and since power imbalances in this context are magnified, the greater responsibility for safeguarding data privacy rests on
data controllers, and by adopting a hybrid data protection model (ie combining consent-notice and data fiduciary approaches)
this can help grant the unbanked/underbanked greater protection. However, such a model has its own challenges, warranting
a deeper analysis.