Decentralized Finance (DeFi) is changing the financial system globally by making financial services widely available, open to all, and inexpensive. Because traditional banks often charge high fees for joining, DeFi platforms open the door to anyone who wants to enter finance, such as the 1.4 billion unbanked people.
Cost advantage over traditional banking
The cost of verifying documents and setting up accounts for regular bank customers runs between $100 and $300. It costs online banks between $20 and $30 for each user. Expensive financial services usually prevent many low-income people from participating in formal finance.
On the other hand, DeFi only needs a smartphone and internet—no banking offices or complicated checks. Because the cost is so low, it is now easier for people in developing regions to become involved in the digital economy.
Empowering the unbanked
Even now, over 1.4 billion people cannot access banking because costs are too high and services are unavailable. Unlike traditional financial systems, DeFi allows users to use savings, borrow, and make payments without official IDs or forms.
In reality, DeFi helps users transfer value between each other. A person in a rural area could exchange livestock for USDT through blockchain and immediately join the global marketplace. It demonstrates DeFi’s power to connect financial opportunities for all people.
Access to global liquidity
DeFi platforms bring liquidity from different decentralized exchanges, forming large, accessible financial pools. Using blockchain, users can manage their finances and trade, lend, or borrow straight from the market. Because of it, money can be easily transferred between countries. The use of blockchain provides communities in remote or neglected places access to global commerce.
With DeFi, users can access strong alternatives to traditional finance without paying for costly onboarding and building infrastructure. It offers new ways for 1.4 billion people without banks to join foreign trade and build wealth. As more people embrace technology, DeFi is on track to help make the financial sector fairer and closer-knit.
