5-star driver = First time loan: The financial inclusion potential of transport platforms

Passenger and cargo transport services based on digital platforms are transforming the transport sector and the financial inclusion landscape for drivers. This is particularly relevant in Latin America and the Caribbean, where nearly one third of people aged 15 or older do not have a bank account at a formal financial institution (World Bank, 2021). Moreover, high rates of informality – characteristic of the transport sector – are associated with low financial inclusion.

Beyond the efficiencies that ride-hailing services and transport platforms for cargo bring to the markets where they operate, these digital transport platforms the potential to foster financial inclusion among drivers.

The digital payment services embedded in transport platforms can increase the access to basic financial services. By joining these platforms, drivers are incentivized to access and use basic financial services and e-transactions, as digital payments generally require a bank account.  In this respect, a study on ride hailing in LAC found that 15% of Uber drivers with a bank account opened it to receive payments (Azuara et al., 2019). Platforms are also partnering with banks to offer basic services. In Mexico, Uber partnered with Mastercard and BBVA bank to offer debit accounts to drivers.

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How to reduce the housing deficit in Latin America and the Caribbean with inclusive and resilient solutions?

n Latin America and the Caribbean (LAC), the housing demand is greater than the supply of decent housing. This is what is known as housing deficit. This deficit can be both quantitative and qualitative. The former measures the need of households for new housing. The qualitative deficit, on the other hand, is made up of housing units in poor condition and/or those that need access to basic services such as drinking water, sewage, etc.

It is estimated that the housing deficit affects almost half of the households in LAC. However, this data is prior to the COVID-19 pandemic, which impoverished the economies of the most vulnerable populations, so it is possible that the housing gap has increased even more.

The IDB Group, integrated by the Inter-American Development Bank (IDB), IDB Invest, and IDB Lab, has spent decades leading the provision of solutions that make it possible to reduce the housing deficit in the region. In the current context of economic recovery, our role is more necessary than ever to achieve this goal. For this reason, the IDB Group held the 2022 Housing Forum on September 29th and 30th, 2022, which addressed the main solutions for reducing the housing deficit, considering the objectives of resilience, adaptation to climate change and inclusion.

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AI adoption continues to grow, but is anyone testing?

There’s a lot of talk about the accelerated processes of digital transformation and the adoption of emerging technologies as a result of the pandemic. However, there’s comparatively attention on the evaluation and results of these innovative solutions, such as artificial intelligence (AI). What sort of good practices can we implement in these processes?

Let's look at some figures and trends from recent years. In 2021, 52% of companies accelerated their AI adoption plans due to the COVID-19 crisis and 86% said that AI became a “mainstream technology” in their business. The average adoption rate in all regions of the world increased by 6% compared to 2020, remaining at 56% – and in Latin America from 41% to 47%.

In 2021, global AI funding increased by 108% ($66.8 billion) compared to 2020. This increase was led by the health sector, which accounted for almost a fifth of total funding (18%).

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