Fintech is keeping growing unemployment rates in the US on manageable levels

Humanity is facing an unprecedented global crisis caused by the novel coronavirus pandemic. The infection that first started in China’s Hubei province has now covered the absolute majority of earth, infecting almost 4 million people while the death toll nears grim 300 thousand. Wuhan, the city known for being the first urban area to go on strict lockdown is now gradually going back to normal but under certain conditions. Face masks and surgical gloves are becoming the harsh reality of the pandemic we are trying to coexist with. However, other places around the world are just entering the peak phase of this deadly infection. 

Europe for a long time was the global epicenter of the virus. Italy and its northern Lombardy region recorded an alarming number of new coronavirus cases. Amid the country’s aging population and high mobility, Italy became the first country to impose a nationwide lockdown. It to date remains one of the most severely affected countries as tens of thousands have died from the virus. 

Other countries in Europe soon followed the exact same pattern with Spain quickly overtaking Italy in terms of total infections while the United Kingdom now has the highest death rate in Europe and only lags behind the United States globally. The country’s prime minister Boris Johnson initially made a number of optimistic predictions about the coronavirus pandemic within the United Kingdom. However, after testing positive for it and even spending a few nights in intensive care, his approach to the matter has completely changed back to Number 10. 

The United States and the approach it chose 

No other country in the world is as powerful as the United States of America. Whether it is in terms of the Gross Domestic Product or the military arsenal, the nation is leading the way in almost all sectors. It is a global powerhouse, generating incomes for not only Americans but a large immigrant population and those living abroad. 

The American economy is strong because it never stops working and is open to individuals and businesses from all around the world. Therefore, the COVID-19 pandemic could have been absolutely detrimental to its well being and dynamics. Fearing that the economy would not be able to handle being isolated, the current resident of White House along with a number of high profile officials initially decided to keep the country open.

Despite Trump’s and the entire government’s best efforts to avoid quarantine and even the ‘stay at home’ advice, the country still entered a large scale community transmission phase. With a population of 328 million, the United States quickly overtook all other countries in all aspects. Over a million people have contracted the virus and the number is growing fast. At this point, the government order is to stay at home unless your work is essential. However, a number of states are protesting against lockdown. When we talk about protests, we really mean physical protesting as thousands of people have gathered outside government buildings and on central avenues all across the country. 

Unemployment hits the highest rate in decades

Prior to the coronavirus pandemic, the United States unemployment rate was at a 50-year low of around 4.4%. However, COVID-19 has changed reality as more than 33 million people have now applied for unemployment benefits. Many states are openly stating that not much is left in welfare funds with California officials saying that the state will soon run out of money. 

Forex indicates how the US is struggling with the pandemic 

As the country’s economy has come to a standstill, thousands of people in the most powerful nation on earth fear that US dollars might be in danger. Fintech innovation and universally accessible platforms let anyone trade with currencies on the web. And the biggest issue is that most Americans don’t even have the resources or the access to platforms that would allow them to somehow participate in the activity of their own native currency. According to FX brokers reviewed here, which is quite a large list, only a select few Forex brokers have the legal right to provide speculative services to the local population. This further manifests into institutional traders as well that tend to be much larger players in the markets. Very few people in the local markets that have first hand experience and information with the currency are simply absent from the markets, making the USD much more volatile in the days to come. But that hasn’t stopped many from trying as active use of VPN technology or some sort of personal data masking is allowing a handful of traders to participate in the markets at least a couple times a month.

Fintech is delivering many more tangible benefits than big corporations

Thanks to technological advancements, the majority of people are able to work from home. However, many businesses, especially in the tourism and hospitality sectors are gradually moving towards signing their own bankruptcies. Under this immense economic turmoil, companies are more and more likely to fire their employees or send them on unpaid leave. Such decisions are often supported by Force Majeure clauses in employment contracts, allowing businesses to avoid payments under unexpected crisis situations. 

Thankfully, there are many businesses trying their best to pay their employees while we glide through this pandemic together. For many small and medium-sized enterprises, paying salaries means taking up loans. With the vast majority of the traditional banking industry closed or limited to essential services, many businesses would struggle to find solutions without the presence of digital banking. 

Fintech is once again proving its value to humanity as a range of neo banks and digital banking services grant loans to businesses in less than a day. This convenience is what we really need to maintain workplaces to as many people as possible. 

Governments are utilizing fintech’s benefits through relief measures 

The United States will be using fintech through its comprehensive and complex coronavirus economic relief plan. Fintech services will be used to grant loans and make financial transactions to people all across the country. Therefore, in the process of restarting the economy and keeping workplaces alive, fintech will play a crucial role in the team of the government as well. 

Fintech serves more people than traditional banking is able to

Based on the worldwide web, fintech services are available to more people than traditional banking services are able to service. Now, as millions of people are back home for self-isolation, the US rural population is higher than just a couple of months ago. Mobile banking user numbers are up 35-85%, showing how massive fintech’s role in this process is. 

For those who are working from home, fintech is the only way to deal with finance and daily transactions. For many businesses, regular relations with financial institutions is crucial and this is where fintech once again provides reliable, efficient, and convenient service. 

Fintech is saving jobs and we should acknowledge its role

With so many different examples, fintech companies are helping businesses, individuals, and even the government more than any other niche of the financial industry. Whether it is the provision of loans or accessible financial platforms for businesses, the already skyrocketing unemployment rates across the US are kept still at a lower level thanks to fintech.