By Julie-Ann Guivarra, Ambassador for Gender Equality, DFAT and Mary Ellen Iskenderian, CEO & President, Women’s World Banking
In 2016, Women’s World Banking and the Australian Government, through the Department of Foreign Affairs and Trade (DFAT), teamed up to build a more secure and prosperous future for low-income women in Southeast Asia. Since then, the partnership has seen significant progress across the region, connecting more people with the financial products, services, and resources they need to thrive. While the disruption of COVID-19 has put the financial well-being of women more at risk across the world, Women’s World Banking and DFAT are working to pursue new opportunities to make enduring gains in women’s financial inclusion for a post-COVID world.
According to the World Bank, COVID-19 will push in excess of 88 million more people globally into extreme poverty. UN Women estimates that at least 47 million of them will be women and girls. Unfortunately, Asia has not been as economically protected as it was during the last global financial crisis, and bodies such as the International Monetary Fund predict uneven growth in 2021 across the region. They also warn that social cohesion is likely to be affected by rising inequality due to job losses among low-income groups. While the number of people living in poverty in developing Asia would have declined to 114 million by the end of 2020, COVID-19 reversed this trend. The Asian Development Bank (ADB) estimates the number of poor people is likely to rise to 192 million by the end of 2020.
In many parts of Asia, women bear the brunt of the pandemic’s effects. This is largely because they are more likely to be employed informally, and so not only have less security, but also less savings and access to insurance to weather economic downturns. They are also more likely to work in heavily impacted sectors like tourism, food and hospitality, manufacturing, and domestic work.
There are, however, ways to mitigate the devastating effects of the pandemic. Studies show that when people have access to formal financial services, they stand a greater chance of rebounding from the financial impact of a crisis. Against this backdrop, in 2020 the Australian Government renewed its support for Women’s World Banking’s ongoing work in Southeast Asia for a further four years. The scope of the work seeks to broaden Women’s World Banking’s research, development of financial solutions, and policy advocacy particularly targeting Indonesia, Vietnam, and Cambodia.
Southeast Asia is of particular importance to both of our organizations. For the Australian Government, achieving financial gains for low-income women in Southeast Asia is a crucial part of lifting entire families and communities out of poverty and bolstering the economic well-being of the region. Under the Australian Government’s response to COVID-19 Partnerships for Recovery, we are working to ensure that our response and recovery efforts are gender responsive in order to emerge from COVID-19 with a stable, prosperous, more inclusive and resilient region.
For Women’s World Banking, Southeast Asia represents a huge opportunity to make real gains in women’s financial inclusion. The gender gap is particularly pronounced in Southeast Asia. Of the 1.2 billion women around the world who have no bank account or who do not actively use one, 12% (117 million) live in four countries in Southeast Asia – Indonesia, Vietnam, Cambodia, and the Philippines. Women’s World Banking’s pioneering, gender focused financial inclusion work, bolstered by the partnership with the Australian Government, has enabled us to forge relationships with both public and private sector partners across the region who can help implement impactful programs on the ground. Current and recent projects include Government-to Person payments (G2P) and payroll account activation in Cambodia with Wing, projects on G2P savings account activation in Indonesia and training Indonesian midwives to become banking agents. Our Southeast Asia research includes studies on wage digitization and the financial service needs of social commerce entrepreneurs with recommendations on how to deepen women’s financial inclusion. We have also worked closely with the Indonesian government to strengthen regulatory capacity (including training more women regulators) and ensure low-income women are included in the country’s financial inclusion strategy.
As we renew our collaboration for 2020-2024, we have committed to bring about innovative and lasting changes that will reach one million low-income women in Southeast Asia. We will do this primarily through three strategic objectives that will inform all of the projects we undertake: demonstrating how women are empowered when they can access and use financial services; influencing governments to implement policies that promote women’s financial inclusion and leadership; and supporting financial service providers to invest in women leaders and create financial products and services designed to work for low-income women.
Women’s World Banking will partner with financial services providers to design and implement at least three new financial solutions tied to government social welfare programs for building women’s financial resilience. We are introducing microinsurance products with local financial institutions and building on our findings about women’s usage of digitized payroll and G2P accounts in the region, so that we can ensure women are better positioned to access and use those accounts for savings and remittances, while also developing the skills to access digital financial services.
With a stronger presence on the ground, Women’s World Banking will be able to cooperate more closely with stakeholders in target countries, building on existing expertise and networks.
In renewing our support for Women’s World Banking’s work in Southeast Asia, Australia reiterates our commitment to initiatives that reduce the impact of the pandemic on women and support their meaningful participation in and benefit from economic response and recovery programs. This work will continue efforts to develop financial products such as savings and more affordable microinsurance and remittances – crucial safety nets during times of crisis – and to help low-income women build resilience for themselves and their families. For women entrepreneurs, such access to formal financial services can help them grow their small businesses, invest, and accumulate assets, allowing them to reduce risk, withstand shocks, and recover more quickly. As the entire world seeks to recover from the current economic crisis, ensuring that women are active participants will only shorten recovery times, and ensure our societies are fairer, more inclusive, and ultimately better for all.