Women’s World Banking is a network of 39 financial companies across 28 countries that focus solely on women. Recognising the poor access women have to credit and savings instruments, WWB works to level the playing field. Mary Ellen Iskenderian, president and CEO of WWB, talks to TOI-CREST about why women need to treated differently and what a women’s only public sector bank can achieve.
Why do you women need specialised focus in banking? What has the global experience shown?
Our experience very clearly shows that financial products don’t take into account the unique needs of women. Some of the things we see, we see everywhere, are not unique to any one country. Many women have mobility constraints i. e. in their ability to move around, to go to bank branches. You’ve to bring the bank to the client. We have also seen that when it comes to asset building or savings’ products, women are very keen on confidentiality. They prefer a model where they can retain that. A vast majority of the world saves 10-15 per cent of its income but that vast majority is doing that informally. Often women will come together to a trusted person, pool money and then there is a lottery for that month’s savings that goes to one woman but it doesn’t work all the time.
Also convenience is prized. A study in Malawi has shown that mobile vans that went to villages on a regular schedule are very successful. The study had both men and women clients keep financial diaries, which showed that while the men were willing to spend 7. 90 cents on transport to deposit money to a branch, women said they can wait until the van comes to them. It is a highly prized product attribute.
India has just announced a public sector bank only for women. What do you think should be the main objectives/ concerns for such a bank?
Our experience has shown that you have to pay special attention to them to get their attention. They are very loyal clients, if they are given dignity and consideration. They will repay that service with word of mouth. If you don’t treat them well, however, they will tell everybody that too.
There is a really important set of concerns, when it comes to a public sector bank. Who is depositing the money? Are men depositing too? Will the men want loans too? We need clarity on these plans.
A successful bank in Kenya opened a women’s only branch but that shut down four months later. Women said they didn’t want to be segregated;they just wanted to be treated well.
We are delighted that the government is concerned about this. You have very good institutions – SEWA for instance. The SEWA model of small deposits and allowing women to save towards clear goals such as a down payment for a house children’s education, at their doorsteps, a powerful model. That is something a commercial bank cannot afford. And we don’t know if a public bank can do this either. Specialised licensing of banks or NBFCs (non-banking financial companies that have shown that they are properly capitalised and have a reliable track record of serving women, with a regulatory man date might be a better way.
What kind of investments do women tend to make? How is their behaviour different when it comes to borrowing?
We see that women interact with the financial system along a lifecycle pattern. We often see child rearing in early stages, and then women might borrow for a business for generating income but not invest so much back in the business as a man would at the same stage. Top three things for women are children’s education, family health and housing. We are interested to see what happens as the lifecycle moves.
In the South Asia context, for instance, we see that when the oldest son is married and a daughter-in-law comes into house, the woman entrepreneur starts building business in a different way and it takes off because she is free of obligations though at the expense of another woman.
When women move away from these household duties, and focus more on business, investment patterns change. Often a very explicit division of labour between husband and wife exists, so his business gets more investment while she invests in the family. It isn’t wrong, it is just different.
Have you observed differences in lending practices/behaviour between regions?
They are actually very, very similar. Women look to financial institutions to meet needs at birth, maybe a health insurance product to cover their own or child’s costs, or starting a savings account for a child, saving for education, then for a business. Inmicrofinance, we are starting to see micro-pensions being developed, which is very exciting. If women can cross child bearing years, they live longer than men and they need to start saving for that and towards less dependence on children.
How has technology helped with women’s access to finances?
There is lot of potential in India and a little catch up needs to take place. In Africa we are seeing cell phone tech revolutionise banking. They reach remote populations which never would have been on their radar. Even the cost structure of mobile banking is so much lower than traditional. But it is absolutely critical for women to take advantage of mobile technology to own the phones instead of sharing. The issue of confidentiality rears its head again here.