We’re pleased to see The Economist draw its readers’ focus to the issue at the core of Women’s World Banking’s work: financial inclusion. It was however, disappointing that the subject of the gender gap in financial inclusion was only lightly touched upon:
“In other countries discriminatory laws, such as restrictions on the ability of women to enter into contracts (and hence open bank accounts), contribute to the considerable gender gap in access to banking.” – A phoneful of dollars, Nov 15th 2014
Of course, discriminatory regulations do indeed play a big role in women’s, especially low-income women’s, continued financial exclusion. However, regulations are just one barrier women face around the world. Women face tremendous social and cultural barriers: they face barriers in terms of having an identity card which allows them to open an account; mobility and thus their ability to go to a bank; property and thus their ability to provide collateral for a loan; education and thus their ability to properly know and use any financial tools available to them. And a barrier that is far too common – invisibility: based on our research in Latin America, women, particularly in rural areas, contributed significantly to household income; however, their husband, loan officer and even the women themselves, did not recognize the extent of their financial contribution to the family income… sometimes exceeding even that of her husband.
Our more than 35 years of research into the financial lives of low-income women has found that they are a tremendous market opportunity – women are avid savers and they are better repayers. They also invest their money in their children’s education, healthcare for their families and better housing – all things that can make positive inter-generational change. This is why any conversation about financial inclusion must take into account the specific needs of women.
Women’s World Banking is working with financial institution partners around the world with financial products and services that are designed to mitigate these challenges and meet their unique needs. We worked with Diamond Bank in Nigeria on BETA, a savings product for microenterpreneurs wherein an agent, called a ‘BETA Friend’ comes to the client’s market stall to open an account via mobile phone and visits regularly to collect deposits so she can save safely without leaving her business. We worked with Interfisa Financiera in Paraguay, Fundación delamujer in Colombia and Caja Arequipa in Peru to develop loans tailored to the unique needs of rural women, introducing a new loan assessment methodology that included a more rigorous investigation of household cashflow to uncover women’s true contribution to the household and thus her viability as a loan client. We have also worked with institutions in markets as diverse as India, the Dominican Republic, Mexico and Kenya to devise financial education programs to increase women’s financial literacy and their ability to make full use of their accounts.
These are just some examples of the work we do around the world. The financial inclusion of low-income populations is a problem on the scale of billions, one that sets back the world’s development agenda if not addressed. Let us not forget however that more than half of the unbanked are women, women who face barriers beyond sheer poverty in accessing financial products and services. While we are glad to see this issue in bigger and wider conversations, we must always remember: you can’t forget the women!