BANKS are overlooking a major source of savings which could help them meet growing demand for credit – women, Nigerian Finance Minister Ngozi Okonjo-Iweala has said.
Okonjo-Iweala who was in Nairobi yesterday for the Women’s World Banking Africa Advisory Council meeting said financial institutions, largely banks have not been effective in marshaling savings, hence losing out to other saving informal institutions.
“When you talk of financial services, people just think of credit financing. These institutions have not been good at mobilising savings,” said Okonjo-Iweala.
“Women are great savers…65 per cent of people in Nigeria save money but they do so in informal institutions. We need to approach women with a savings product and change the existing mindset.”
She added: “Serving the low income women’s market is by no means a charitable endeavour, but a significant market opportunity for banks.”
According to the Central Bank industry report for the third quarter ending September 30, gross loans and advances grew at a faster rate than deposits at 7.3 per cent compared to the previous quarter; while deposits only rose by 4.6 per cent.
Although deposits still had a higher total value of Sh2.25 trillion compared to loans at Sh1.91 trillion, majority of it was not long term deposits that can be classified as savings.
The deposit base increase was supported by branch expansion, remittances and receipts from exports, said CBK in the report.
Women’s World Banking co-chair and Kenya Women Holdings CEO Jeniffer Riria said: “Women in Africa are an ignored force yet that is where the greatest potential for economic growth lies.”
According to President and CEO of Women’s World Banking, Mary Ellen Iskenderian, only 20 per cent of women in Africa have a bank account.
Iskenderian said it was urgent that more women are enabled to access services of main stream banks and into the formal economy.
Women’s World Banking is a global non-profit organisation with an aim to ensure more low-income women access financial services and resources.