Report can be downloaded at the end of this article.
When women have access to savings accounts, loans, and digital financial services, they gain greater control over their finances, make informed decisions, and have a safety net during emergencies.
Yet, there exists a substantial global opportunity – $700 billion dollars’ worth (USD) if women were served at the same rate as men. But women continue to be among the most underserved customer groups in the financial services industry. The industry is moving in the right direction but gender gaps still exist.
Women’s World Banking used participatory research methods to assess how financial inclusion might lead to women’s economic empowerment (WEE) from the vantage point of low-income women in Indonesia. Our Empowering Indonesia’s Artisans report explores the importance of financial inclusion, its impact on women’s economic empowerment, and the steps needed to foster an inclusive financial ecosystem.
The creative industry is one of the key sectors of the Indonesian economy contributing about 8% to the country’s GDP. In 2021, the creative industry contained 21.9 million workers or 17% of Indonesia’s total labor force. This number makes the creative industry the third-largest sector after agriculture and retail. Women are the dominant segment in the creative industry with 58% of the creative industry’s 21.9 million workers.
We’re pleased to highlight five insights from the report, unveiling key connections between women’s financial inclusion and women’s economic empowerment:
1. There is a strong, positive, and statistically significant relationship between financial inclusion and women’s ability to enact her preferences and bargaining power.
“It is essential for women to possess bank savings accounts. Such accounts enable them to manage their finances independently, eliminating the need to depend on their spouses or anyone else.”-35-year-old female fashion entrepreneur in Lombok
2. Financial inclusion coupled with income is more powerful, statistically speaking, than income alone or financial inclusion alone. We call this an “interaction effect.” It means that inclusion coupled with income is a much stronger predictor of women’s economic empowerment than these two factors independently.
3. The most economically empowered women in the creative industry are the ones who have financial services access and who have overcome social norms. By challenging norms and promoting financial literacy, women can become agents of change in their communities.
4. The findings indicate that when women use financial services like savings account or loans, there is an increase in their economic empowerment, which is directly related to a positive impact on women’s financial independence and well-being.
5. Financial inclusion increases income for women artisans. One woman said, “I receive online orders. My customers pay by bank transfer or QR. Once I have been paid, I just send the orders. It is easier.” Women’s access to credit also helps them grow their businesses.
Read the Full Report
Economically empowering women means addressing the diverse challenges they encounter, including regulatory barriers, social and cultural norms, and the absence of customized financial solutions. Informed by the full findings, this report offers concrete recommendations that policymakers, financial services providers, and grassroots support organizations can implement to enhance women’s economic empowerment.