With a growing gender gap in financial inclusion in Bangladesh, it is imperative to understand the behavioral barriers women face when engaging with digital financial services. Passive account openings, limited use cases, the role of cash and lack of differentiation are contributors to low usage, preventing women from being financially included and financial service providers from untapping the tremendous market opportunity women have in Bangladesh.
According to the Global Findex, the percentage of mobile money accounts has jumped from three percent in 2014 to 21 percent in in 2017 in Bangladesh. At the same time, the gender gap in account ownership has widened—from nine percent in 2014, to 29 percent in 2017, representing a disturbing trend affecting the progress of women’s financial inclusion in Bangladesh. Furthermore, a vast majority of women who do have accounts are using them less frequently than men.
Women’s World Banking knows that women in Bangladesh can be promising digital financial services (DFS) customers, but the question is: Exactly how will digital financial services work for women in Bangladesh?
The obvious answer is to design solutions based on deep understanding of women clients in Bangladesh. Establishing the right partnerships, conducting qualitative and quantitative research on the ground to better understand the financial needs and barriers that women face are critical to opening up the market opportunity to serve the 41.3 million un- and under-banked Bangladeshi women.
*Photo credit: M. Ataur Rahman
As one of the largest mobile money providers in Bangladesh, Dutch Bangla Bank (DBBL) has enormous potential to drive financial inclusion for women through its mobile money account offering, Rocket. Rocket provides financial services by offering cash-in, cash out, merchant payment, utility payment, salary disbursement, foreign remittance, government allowance disbursement, and ATM withdrawal via mobile devices.
Women’s World Banking has partnered with MetLife and DBBL to better understand the financial behaviors and experiences of DBBL Rocket’s women customers. These findings will inform the design process and ensure that any solutions created to meet the needs of women Rocket customers and further their financial engagement.
Data helps us better understand low usage of DBBL Rocket by women customers
Initial data analysis concluded that although DBBL Rocket has a large customer base, its customers are predominately inactive, with only a 23 percent activity rate as compared to the industry benchmark of 30 percent. It also revealed that DBBL Rocket’s transaction types—cash-in/out, disbursement, P2P, airtime top-up, bill payment, and merchant payment—were all below the industry benchmark.
Women’s World Banking conducted qualitative behavioral customer research to better understand DBBL Rocket’s customers’ behavior and interactions with their mobile money account.
Using Women’s World Banking’s proprietary Women-Centered Design research methodology four key behavioral barriers emerged from Rocket’s women customers when deciding how to use their account:
Rocket is not an active choice
Across all customer segments, customers did not choose to open their accounts. Instead, accounts were opened for them: employers open the accounts for women who use the account for salary disbursement; schools open accounts for women who receive government stipends; and for other accounts that fall into a “general” category, family and friends often open the account for women in order to facilitate a transaction. This passive relationship with the product makes customers less likely to use it.
Usage is driven predominately by cash-out
The customer’s main use of the account is driven by cashing-out. Women do not see the account for any other purposes than receiving and getting their money.
Cash is still king
The way which customers are carrying out their financial transactions is still driven by cash.
Lack of differentiation
If customers use Rocket, they are using it interchangeably alongside its competitor. They don’t see the difference between products.
Women-centered design will deepen engagement in order to drive transactions
Women have the potential to become complex, multi-case users of DBBL Rocket, given the right opportunities and resources.
In order to drive account usage, the team’s work will focus on decreasing the cash-out rate, while simultaneously increasing and creating opportunities for women to use their accounts. By making these opportunities salient to women customers, Rocket can begin to introduce and create new use cases, such as savings.
Women’s World Banking will use an iterative Women-Centered Design process with co-creation techniques to take these insights and transform them into commercially viable and customer-centric designs that work for the women customers and for DBBL. This approach forms a central part of Women’s World Banking’s strategy to address the deepening gender gap in Bangladesh.
Women’s World Banking’s work with DBBL is generously supported by the MetLife Foundation.
Expanding Financial Access for Rural Women in Egypt - SoundCloud (696 secs long)Play in SoundCloud
“It’s not that the barriers are necessarily different for the rural women and the urban women. But the same barriers are greater for rural women.”
In this podcast, Veronica Karpoich, Project Manager at Women’s World Banking discusses Women’s World Banking’s progress in closing the gap of financial access for one of the most challenging segments to reach, rural women.
For the past year, Karpoich has been working with Women’s World Banking network member Lead Foundation to leverage the success of its individual lending program to introduce another methodology, one that is tailored to rural business activities performed mostly by women.
Sabah’s Story: The Life of a Rural Entrepreneur in Egypt - Vimeo
India has experienced exponential growth and enacted innovative financial initiatives in recent years, but promising indicators of greater financial inclusion mask a concerning trend. About half of the women in India with personal bank accounts use them in a limited capacity or not at all. Women’s World Banking’s India Strategy addresses why women aren’t engaging with financial services, lays out a plan to better understand the trend, and outlines a systemic remedy that will result in greater financial opportunity.
India’s Story of Growth
At first glance, India appears a picture of economic progress. Its economy is the seventh largest in the world, its startup ecosystem is generating international buzz, and its government has pioneered experimental programs, like PMJDY, which mandates that every household has at least one bank account, and Aadhaar, which grants residents a unique identity number that can be used to access basic banking services.
These efforts, though not without flaws, have significantly increased access to and inclusion in India’s economic system. In 2011, only 53 percent of adults in India had a bank account. In 2017, that number reached 80 percent with a gender gap of just 6 percent, a significant improvement from 2014, when the gender gap was 14 percent.
The numbers indicate a positive trajectory for one of the world’s strongest emerging markets, but they don’t tell the entire story. Despite the narrowing gender gap, women—especially underserved or low-income women—still lag behind men in critical ways.
Where Women Fall Behind: Engagement
While the lines on India’s various economic charts trend upwards, dangerous gender disparities persist. For example, only 51 percent of women are literate, compared to 77 percent of men. Women also face greater health risks, like a high maternal mortality rate, and are increasingly less likely to participate in the workforce. So, while data suggest improvement in women’s financial access and inclusion, it’s important to look more closely at how and exactly to what extent women really participate in India’s economy. Consider this: of that 77 percent of Indian women with a bank account, about 50 percent use it either in a limited manner or don’t use it at all. This statistic illustrates a larger problem, but it also provides a starting place to solve it.
While India’s FinTech sector accelerates, its asset-management industry grows, and its government fosters financial innovation, women remain largely outside of the financial fold, underserved and unengaged. The problem is that they aren’t taking advantage of the gateway to financial inclusion: basic banking services, such as savings. This stymies economic growth, hinders social progress, and represents an enormous opportunity missed.
Making it possible for more women to engage with their savings accounts will allow them to increase their financial capital, their financial understanding, and ultimately, their financial inclusion. Women, in turn, will use a greater number of financial services and invest back into the economy. There are approximately 430 MM women in India, which means well-executed, products and programs designed with women’s needs in mind represent an enormous opportunity to scale up. Because India’s population skews young, there is also huge potential for long-term customers for financial service providers.
Women’s World Banking’s Country Strategy
The barriers preventing more complete financial engagement among women in India exist both for women and for the financial service providers. Women’s World Banking will implement a strategy that tackles the constraints on both levels.
To begin with, Women’s World Banking will work o better understand Indian women’s specific needs and where the interaction with financial institutions fails. Based on initial research, women’s reasons for remaining “underbanked,” or relying on alternatives to their bank accounts, include issues like not owning a mobile device, a tradition of cash transactions, limited understanding of the value in banking, and lack of financial literacy.
Better understanding the nuances of women’s barriers to financial inclusion will give way to stronger initiatives. Microinsurance, digital financial services, and the use of third-party business correspondents (who bring financial services right to women’s doorsteps) already stand out as promising areas of opportunity in which to act.
Women’s World Banking will partner directly with financial service providers—e.g. small finance banks, commercial banks, and insurance companies—to design women-centered products, teach risk-mitigating strategies, and encourage asset building. Take Small Finance Banks as an example: many of them were once microfinance institutions and therefore know the underserved women’s market already. Those relationships, combined with Women’s World Banking’s significant experience in education and training, will ensure a productive and sustainable partnership. A Small Finance Bank whose employees learn to introduce new products to clients who already trust them will see greater engagement more quickly.
How to Reach and Recognize Success:
Women’s World Banking is setting out to be the preeminent advocate for women’s financial inclusion in India. To do that, it will partner with local financial service providers and facilitate an ongoing dialogue via media coverage, conferences, and education efforts.
Measurable indicators of the strategy’s success include:
Implementation of women-focused financial programs by India’s government
An increased number of banks and other financial service providers that develop strategies to target underserved women
A rise in the average savings account balance
A greater percentage of women saving consistently to reach a goal
More women having both active savings accounts and buying health insurance voluntarily
A greater percentage of women who are able to complete transactions through digital technology
The return on investment—of time, resources, and attention—is enormous. Once women experience greater financial agency, their participation will help power the engine of sustained economic growth in India.
In March of 2018, Women’s World Banking announced the launch for She Counts, a global platform that harnesses the power of financial services to put savings and financial tools in the hands of women, enabling them to plan for a more prosperous future. Through extensive due diligence to identify the institutions exemplifying best practices in savings, Women’s World Banking is pleased to announce the first cohort of She Counts members including: NMB (Tanzania); CARD Bank (Philippines); Diamond Bank (Nigeria); and MaTontine (Senegal).
An innovative two-year pilot program led by the Center for Global Development with support from ExxonMobil, tested the impact of formal savings accounts by connecting more than 5,000 women entrepreneurs in Indonesia and Tanzania with mobile savings tools and business trainings. The rigorous evaluation found that these financial tools have a substantial impact on women’s savings, business practices, and economic empowerment.
Furthermore, a deeper analysis of the pilot revealed this important trend: women want savings accounts more than men do. Across different contexts, 63 percent of women will take a savings account when offered, versus only 26 percent of men.
Despite the demand, not enough women have access to well-designed savings solutions that allow for building a more secure and prosperous future. For this to happen, more awareness and best practices for serving low-income women with savings products must be shared across financial institutions in the emerging markets.
As a result of these findings, She Counts was launched to bring together select financial service providers to share best practices and drive more savings solutions into the hands of underserved women.
What makes an institution successful in serving women well with savings products?
Before selecting the appropriate financial institutions for She Counts, Women’s World Banking identified the best practices along the customer journey. These best practices are broken down into 4 key stages:
Acquisition/Awareness: To build awareness to acquire a woman client, financial service providers need to be creating marketing messages and visuals that speak to women. They also need to develop use cases that meet women’s lifecycle needs and leverage existing channels women already access, such as savings groups or G2P payments.
Activation: It isn’t enough to just acquire a client. Women need a reason to conduct the initial transaction. This can be facilitated by a simple account opening process, employing tiered KYC when regulation allows, and leveraging existing ID databases to more easily fulfill documentation requirements.
Active Usage: To keep women using savings on a regular basis, it is necessary to have well-trained agents that women trust. Building financial and digital literacy programs help women increase their confidence and comfort in using formal financial services. Ensuring women have convenient access points to overcome mobility, distance and time constraints make it easier for women to use products on a regular basis.
Retention: Women are loyal and profitable clients when treated with respect and with well-designed products. Financial service providers need to ensure fees are not prohibitive and design tools to create ongoing peace of mind, such as balance inquiries. Encouraging goal setting with behavioral nudges builds consistent usage.
In addition, financial service providers need to collect and analyze gender-disaggregated data to measure outreach and engagement with women clients as well as design product bundling to meet women’s diverse financial needs.
Introducing the first cohort of She Counts
After identifying the best practices along the customer journey, Women’s World Banking began its due diligence process to identify the first cohort of She Counts members. Each of the inaugural members has a different business model and approach to serving low-income women but has a deliberate focus on many of the best practices along the customer journey. The members include:
NMB (Tanzania): A large retail bank in Tanzania, NMB has several savings propositions that serve women effectively including Pamoja, a group savings account that leverages existing Village Savings & Loan Associations (VSLAs) to drive acquisition; Chap Chap, an account that can be opened instantly to drive activation; and Wajibu, a suite of youth and parent-controlled accounts along with financial capability training to drive active usage.
CARD Bank (Philippines): CARD Bank’s Pledge Savings Account is a commitment savings account that requires deposits at weekly meetings. As part of the Pledge Account, clients have the “konek2Card,” a mobile application where clients can monitor their account, creating peace of mind for ongoing usage.
Diamond Bank (Nigeria): Diamond Bank’s BETA proposition reaches low-income women market traders throughout Nigeria. The BETA suite of products includes both transactional and commitment savings accounts to meet women’s needs at each stage of their life. BETA Friends are agents that come to the client’s market stalls each day to collect deposits, manage withdrawals and provide basic financial education, building trust with the financial institution through the BETA Friends.
MaTontine (Senegal): MaTontine is a FinTech platform that digitizes the traditional “Tontines” in order to provide a suite of financial products for women including savings. The managers of the Tontines are well-regarded in the community in order to build greater trust with the financial system. In addition, SMS messages are sent to members to remind them to deposit, creating an ongoing savings behavior. MaTontine also collects and analyzes its data to provide credit and insurance products based on prior client behavior.
The first cohort of She Counts members were brought together in November 2018 to share their experiences, learn from each other and explore new solutions to reach their clients. Women’s World Banking will continue to share insights from these institutions as well as build additional cohorts of She Counts members. If you are interested in becoming a She Counts member, please contact email@example.com
She Counts is generously supported by the ExxonMobil Foundation.
Yashmin Fernandes, Director of Development and Partner Engagement
The opening Plenary Session at the Making Finance Work for Women Summit discussed the progress and the opportunities ahead in financially empowering low-income women in the developing world. Four key themes emerged: the role of digital, policy design, a broader tent, and leadership skills are necessary to make finance work for women.
Kicking off the opening plenary session from the Making Finance Work for Women 2018 summit, President and CEO, Mary Ellen Iskenderian challenged the audience with some sobering statistics. Despite seeing progress in building assets and resources for women, there are still 104 countries that have laws precluding women from working in certain jobs. The gender gap in the developing world still has not budged from a stubborn 9 percent over the last three years. The gender gap has even widened (doubled in some cases!) in certain countries, such as Nigeria and Bangladesh. And in India where the gender gap has been dramatically reduced, financial service providers are being challenged by 48 percent dormancy rates for savings accounts, one of the highest rates in the world.
The microfinance institution leaders from 40 years ago have been joined by new leaders from the fintech, technology, telecom, and commercial financial services sectors. While tremendous opportunities are presented by new players, the financial inclusion community has failed to create a bigger, more meaningful tent. It needs to expand the number of champions for women’s financial inclusion to truly meet its potential. Mary Ellen made a heartfelt request to the audience to recruit more male champions so that industry leaders are not just speaking amongst themselves in an echo chamber. The panelists, led by moderator Anjali Kumar (author, attorney, advisor, speaker, and “idea acupuncturist”), discussed how their organizations were accelerating gender solutions.
The panelists debating this topic included: Sarah Kaplan, Director of the Institute for Gender and the Economy, and Professor of Strategic Management at Rotman School of Management; Liz Kellison, Gender Lead for the Financial Services for the Poor team, Bill & Melinda Gates Foundation; Mike Useem, Director of the Center for Leadership and Change Management, and Professor of Management at the Wharton School; and Sri Widowati (Wido), Country Director (Indonesia), Facebook.
Digital Opens Doors to Gender Equality Opportunities
Widowati discussed the role of digital as a great gender equalizer. It provides women with access to new ideas, opportunities, customers, and markets. Additionally, women can enjoy this access from the comfort of their own homes. Digital platforms, such as Facebook, are creating new channels for women to reach (and even create) new markets. Women can also access knowledge and networks through social platforms to help them set up, run, and grow their businesses. Digital literacy is key to ensuring widespread participation.
Kellison mentioned that the Gates Foundation believes that digital payment systems are an effective way to reach low-income populations at scale. The Foundation sees great promise in digitizing government-to-person (G2P) social safety net payments as a way to onboard more women to adopt and use digital financial services. Since the vast majority of the G2P cash transfer recipients are women, this is a great way to leverage an existing channel to effectively target women.
Enlisting Support from Regulators
Another key to achieving financial inclusion is to engage regulators to help create the right inclusive enabling environment. Kellison mentioned that one-third of the Financial Services for the Poor team is focused on how regulation can be evolved to enable gender equality. Tiered accounts, eKYC, flexible identification requirements, and alternative credit scoring methodologies are some of the recent developments in the industry that have allowed for greater access by women. To this end, Women’s World Banking and AFI are partnering to deliver a Leadership and Diversity program for Regulators (funded by the Visa Foundation). The program aims to drive greater gender diversity within regulatory bodies, as well as accelerate strategic policy initiatives to more effectively close the gender gap.
Pushing for Progress
Beyond the opportunities presented by digital and policy initiatives, the panelists discussed how else the sector might push for progress. Useem discussed the need for leaders to think strategically, communicate persuasively, and take action decisively. He used the image of a coalition of the eager and ready. Kaplan added that innovation needs to be brought into the conversation. By working under incorrect assumptions, such as women are risk-averse or do not know how to ask, women are still limited by the current system structure. She urged participants to look where interventions are breaking down, and then apply gender analysis; fixing the system to take women into consideration will also help men. Fighting for gender equality needs to make life better for everyone.
Kaplan also suggested that until now, the industry has been designing for low-income women; providers need to design with women for true progress. Some of the negative unintended consequences of interventions have resulted because the women were not sufficiently brought into the conversation.
One of the male attendees asked how to get more men involved (the room was approximately 80 percent female). A passionate discussion ensued about whether the business case for serving women should be the way to bring men into the room. A McKinsey Global Institute report finds that $12 trillion could be added to global GDP by 2025 by advancing women’s equality. While the business case is certainly compelling, it must be supplemented by moral outrage at the gender inequality that still exists. Kaplan suggested that if it’s just the business case that brings financial service providers to the table, women customers can feel on the outside. The business case must be carried by the vision of serving women as valuable customers so that everyone wins.
How do we build the coalition of the eager and ready to make finance work for women? The opening… Click To Tweet
By Diana Boncheva Gooley, Manager, Digital Financial Services
A strategic approach to investing in women can power economies. It was only fitting that after a day of exciting presentations, debates and discussions, Women’s World Banking closed out the Making Finance Work for Women Summit with five amazing women leaders who shared the three elements we need to have the most significant impact on women’s lives and greater economic growth: the right stakeholders, data, and policies.
Women’s World Banking’s recent Making Finance Work for Women Summit brought together leaders from the public and private sectors, investors, and researchers to discuss, debate and create the solutions to drive women’s financial inclusion globally. Throughout the day, issues highlighted included financing women in the supply chain, gender lens investing, the role of technology, and the latest research to drive action. The end of the day, however, brought together esteemed representatives from the private, public and donor communities to identify the critical topics that need to be addressed to power economies effectively. The panelists determined that those topics included bringing together the right stakeholders; collecting and using the right data; and designing the right policies so that women aren’t left behind.
The Right Stakeholders
“We live in an interdependent environment, but we are not all at the table,” said Ambassador Geraldine Byrne Nason, Permanent Representative of Ireland at the United Nations. To ensure women’s needs are met, we must have the right players collaborating, including the private and public sectors as well as civil society.
Collecting and Using Data
The importance of gender-disaggregated data has been a pillar of the discussion on how to reach more women with financial services. Companies and the executives that lead them want to see the business case for serving women but feel they don’t have the data to make strategic decisions. However, the power of data could transform business and policy practices. An example highlighted on the panel was when the United Kingdom published information on the gender pay gap in the country, which led to “an incredible change of behavior. This transparency on women’s compensation created a lot of action and showed how data can create beneficial conditions for change,” shared Lydie Hudson, Chief Operating Officer, Global Markets at Credit Suisse.
Data isn’t just used for the business case for companies. We also need to look at data to measure women’s impact on the overall economy. “We need to reimagine an economy where women are taken seriously, and then work to build towards that. We need a feminist economy and work together to build it with feminist economists,” said Marina Durano, Program Officer at Open Society Foundations.
Designing Inclusive Policies
The data can give us some answers, but effective policies to address these answers need to be developed. Ceyla Pazarbasioglu, Vice President for Equitable Growth, Finance and Institutions at the World Bank Group shared an example from Africa where one central bank saw that between 4:00 AM and 5:00 AM there was a huge surge in transactions. It was about to close processing during that time as it was assumed to be fraud. However, the Central Bank took the time to research this issue which showed that the surge in activity was a result of women traders who went to the market to sell their goods early in the morning before they had to take their children to school. The Central Bank did not shut down the system and did not introduce unnecessary policies that would have unintended consequences for women’s businesses.
Amina Tirana, Senior Director for Governments and Partnerships at Visa Inc, reinforced the view that it is necessary to see the whole picture. “We want to enable businesses to thrive yet women-owned businesses have financing gaps. Policymakers say we need more lending to SMEs, but is this what is really needed? Women want security and increased income. But is a loan the way to achieve that? Many women want a job more than owning a business.” It is necessary to understand women’s needs more thoroughly in order to design inclusive policies.
Taking the time to bring together all the key stakeholders, collecting and analyzing the data, and designing inclusive enabling environments are all key to ensuring we build a world where women thrive, business grow and economies are powered.
By Angelika Mendes-Lowney, Manager, Development & Partner Engagement
The concept of gender lens investing as a powerful strategy to achieve positive financial and social returns is rapidly increasing. In a workshop during Women’s World Banking’s “Making Finance Work for Women” summit on November 7, discussions highlighted that the time is right for gender lens investing but a few barriers are still limiting its potential impact: the need for more demand, data, misconception of what gender lens investing is, and clarity on the business case.
A room full of eager participants at Women’s World Banking’s Making Finance Work for Women summit in early November gathered for a deeper dive into the topic of gender lens investing. Throughout the workshop, four panelists shared their extensive experience and powerful insights around this hot topic that has recently made it on the agenda of major conferences worldwide.
However, the term “gender lens investing” remains unclear to many, and one of the first requests from participants was a clear definition. According to Biegel, gender lens investing is “the use of capital to simultaneously generate a financial return and advance gender equality.” This requires an integration of the gender analysis with the financial analysis.
Key gender “lenses” typically include access to capital, workplace equality, value chains, and products and services that positively affect women and girls. Biegel encouraged participants to ask how thinking more consciously about women in specific sectors may improve the financial or social performance of a fund or a particular business, since finance plays a significant role across a variety of sectors.
Clearly, the time is right and opportunities are plentiful for gender lens investors. However, compared to other, more mainstream approaches, such as climate finance, gender still only occupies a niche: $187 billion were invested into climate bonds in 2017 while only $1.3 billion were invested in gender. What is holding us back? Four key themes were touched upon.
There was also agreement that data is key to making the case for gender lens investing since some investors still won’t accept that investing in gender yields better results. “Increasingly, we see information that gender-diverse teams correlate with better returns,” said Christina Juhasz, Chief Investment Officer of Women’s World Banking’s own gender lens investing fund. As an investor, Women’s World Banking requires portfolio companies to commit to equal pay, at least 35 percent women representation on their board, and the collection of gender-disaggregated data.
A common misconception is the assumption that gender-lens investing excludes men or is a silo while it really is an analytical tool that, if used correctly, reveals rich options on how to drive returns. Moreover, investing in women really helps address all other impact goals. More education is needed to help investors understand this potential.
Finally, the business case for gender lens investing has to be expanded. Johannes Feist, who represented the German Development Bank KfW on the panel, stressed that for too long, gender mainstreaming has only focused on equal opportunity and fairness. Now that there is a renewed focus on the private sector to consider the business case for gender, it is key to help nurture more ventures and more private equity-like structures. Other participants felt strongly that the business case had already been sufficiently proven and that perhaps it needs to be brought home through experience and an emotional journey rather than via facts alone. In an earlier session, Sarah Kaplan, Director of the Institute for Gender and the Economy at the University of Toronto had made the same point and referred to her own meditations on the business case for gender equality.
Investors in the room also shared some best practices based on their own experience. Shareholder agreements, for instance, have proven powerful tools for holding portfolio companies accountable and reminding them of their commitments. In one case, a CEO’s compensation was linked to increasing gender diversity in his company. Solving a company’s key business challenge with a gender lens, or illustrating where that company ranks compared to peers in the market also helps. What should not be underestimated is the power of emphasizing that a follow-on investment will be unlikely if an investee doesn’t deliver on the agreement. Bringing women into the design process to understand what barriers they face and to make sure the products and services provided meet their needs is also key. In order to be successful, investees need to know how to conduct a gender analysis and to understand the regulatory environment, because there is no use in designing a beautiful product to which a woman legally has no access.
The workshop on November 7th demonstrated that despite tremendous momentum for gender lens investing, there is more work to be done. Women’s World Banking is proud to be at the forefront of this promising approach, advancing positive results for low-income women.
Egypt is on the road to recovery after the 2011 revolution, and financial inclusion is growing at a steady pace. But even though women’s financial inclusion is on the rise, the gender gap is widening. Women’s World Banking’s strategy for closing the financial inclusion gender gap in Egypt targets the players and the solutions that will ensure women benefit from, and contribute to, Egypt’s potential for robust growth.
Egypt is still recovering from the economic impact of its 2011 revolution, which crippled growth for a half-decade. Tourism and investment suffered most, and unemployment remains high—with nearly a quarter of Egypt’s women now jobless. But the forecast is brightening: Egypt’s economic growth is projected at 5.3 percent for 2017-2018, and financial inclusion has tripled over the past six years.
While women are benefiting from the recent growth, they’re mostly getting left behind men in financial inclusion. Women’s financial inclusion has quintupled to 27 percent over the last three years—thanks to microfinance, mobile money and government transfers (G2P)–but the financial inclusion gender gap is still widening, doubling to 12 percent in the same timespan.
It’s time for Egypt to leverage the political and cultural shifts that are allowing women to participate more fully in the economy—despite educational barriers, low labor-force participation and challenging social norms. Women’s World Banking’s strategy for closing the financial inclusion gender gap prioritizes women’s financial security as a crucial part of Egypt’s economic growth. Closing the gap will not only benefit women; it will mean a speedier recovery for Egypt.
Women’s Financial Inclusion Taking Center Stage in Egypt
Egypt has nearly 24 million unbanked or underbanked women: that’s 73 percent of its adult female population. The Egyptian government is focusing on gender-related policies as part of its Financial Inclusion Road Map. Its Strategy for Women aims to increase women’s economic and political empowerment by 2030, and to roll out cultural and legal initiatives to protect women. On the provider side, financial service providers are taking a page from the microfinance playbook and reaching out to low-income populations.
Women’s World Banking’s strategy for Egypt will cut the number of unbanked women by 10 percent—adding 2.5 million women to the ranks of the financially included. The strategy targets mobile money providers, FinTechs and other financial service providers with a social mission over traditional banks, which still favor the corporate sector. As the supply of financial services for the unbanked and underbanked grows, the emphasis must shift to providing solutions designed to work for women. Women’s World Banking’s financial inclusion strategy for Egypt will focus on:
Optimizing solutions low-income women already use, such as mobile money accounts, to ensure increased uptake
Working with financial service providers (FSPs) to create better safety net solutions
Increasing awareness for FSPs of the market opportunity of serving women and increasing awareness for women of the options that are available to them
Making the Most of Mobile Money
Roughly 97 percent of households in Egypt, and 80 percent of low-income households, own a mobile phone. Unlike many of the markets we work in, Egypt is close to gender parity in mobile phone ownership. That high penetration rate represents a huge opportunity to raise women’s mobile-money usage. Women’s World Banking’s strategy will double the number of women using mobile money, from roughly 6 percent active wallets to 12 percent. The strategy also calls on mobile network operators (MNOs) to target mobile phone owners who are unbanked and don’t yet use mobile money, which provides a huge untapped market.
With the mobile money sector primed for growth, Women’s World Banking will work with MNOs to ensure that women’s needs are identified and met, and hurdles minimized. For instance, permission from men is still usually required to buy a phone, and 40 percent of women report discomfort from their families about their handset usage. Beyond these social barriers, women in Egypt don’t have enough compelling use cases for mobile money, and use mobile wallets mainly for cash transfers. Women’s World Banking will work with providers to identify more relevant use cases for women such as savings, loans or insurance, thus giving them a reason to use the services.
Creating Better Financial Safety Nets for Women
Stronger financial safety nets are pillars of financial inclusion. In Egypt, women have low adoption and usage rates for savings and insurance. Women who save typically use group savings schemes known as Gami’yaat (ROSCAs).
Behavioral research by Women’s World Banking will identify barriers that keep women from using formal savings and insurance. Learnings from the research will guide the design of solutions that actively engage existing and new women clients.
Women’s World Banking will partner with FSPs, and Fintechs to help them diversify and create new women-centered savings and insurance solutions. Additionally, Women’s World Banking will work with providers on solutions that reach at least 1 million women who receive G2P payments, and other such programs.
Bridging the Distance between Women and Financial Service Providers
Financial solutions designed for low-income women will never gain traction unless the women who need them know about and can access those solutions.
Women’s World Banking will design messaging campaigns that reach out to low-income women in Egypt. Through cognitive and behavioral research and ecosystem development, Women’s World Banking will identify and address gaps in access that prevent low-income women from finding and using financial products.
Women’s World Banking will train financial service providers on the make-or-break necessity of women-centered design. When products are developed with women in mind, women are not just more likely to adopt them but also to actively engage with them and form lasting habits, thus creating the opportunity for women and growth for financial service providers.
With Women’s World Banking’s strategy for Egypt in place, it looks for others to join to build a more secure and prosperous Egypt.
Women in Bangladesh have the highest-ever rates of literacy and employment, and the country’s economy is growing. Financial inclusion now stands at more than 50 percent, nearly doubling in the past few years. But the financial inclusion gender gap is growing rapidly too, with fewer than half of women accessing or using formal financial services. Women’s World Banking’s strategy for Bangladesh addresses why women are getting left out of the country’s financial inclusion gains, and sets out ambitious, workable solutions to shrink the gender gap.
Bangladesh’s economy is on an upswing, and the world’s eighth most populous country reaps the rewards of financial inclusion and rising literacy. More than half the population now uses formal financial services, a big jump from 29 percent in 2014. The literacy rate of girls stands at 80 percent, more than double what it was in 1990—and outpacing the literacy rate of boys.
That’s the good news. Here’s the bad news: the financial inclusion gender gap is growing at an alarming rate, from nine percent in 2014 to 29 percent in 2017. Two-thirds of men have an account with a financial institution, but less than half of women do. And the vast majority of women who do have accounts use them less frequently than men.
At first glance, the financial inclusion gender gap in Bangladesh looks like a runaway train—but it can be stopped. Women in Bangladesh, increasingly literate, employed and employable, are poised for financial inclusion. The barriers that keep women from participating in Bangladesh’s wins are longstanding but fixable. And there’s an enormous upside to closing the gender gap: Women’s financial inclusion will build significantly stronger security for individuals and families, accelerating Bangladesh’s ongoing economic growth.
The Missing Link: The Right Strategy
Women in Bangladesh face many of the same obstacles to financial inclusion as they do elsewhere: gaps in financial literacy, low rates of mobile-phone ownership, and an absence of products created with women in mind, to name just a few. Women who do have an account with a financial institution, especially a mobile money one, do not always know why, how or where they can use it. Discovering and fixing those access and communication issues will be crucial in closing the financial inclusion gap.
Women’s World Banking’s financial inclusion strategy for Bangladesh will make accounts and financial products more accessible, intuitive and indispensable to women in Bangladesh. Working with its partner financial service providers, Women’s World Banking will leverage its financial inclusion expertise and thought leadership to identify targeted solutions and to ensure those solutions are effectively produced and marketed to engage women in Bangladesh.
The “Why” That Drives Women to Use Financial Services
Unbanked and underbanked women need a convincing reason to use financial services to meet their long-term and short-term goals, beyond cashing out government subsidies or their salaries. Women’s World Banking and its partners will conduct behavioral research with women across diverse segments of the economy, to tackle the first barrier to usage: the lack of compelling value propositions. The behavioral research will shed light on the financial needs women have that are currently unmet, and the types of financial products they would use if available.
Providers can then springboard from those findings to develop bundled financial products that do what they’re intended to do: reach women and convert them into active users. In cases when financial products already exist to fill the identified needs, Women’s World Banking will work with providers to position those products so women can access and use them.
There is already a giant missed opportunity in the estimated 15 million women in Bangladesh who are government to person (G2P) recipients, and the additional estimated 13 million women who receive remittances. The majority of those women are not using their accounts to save money or meet other financial goals. Women’s World Banking will work with institutions that deliver remittances, salaries, government transfers and microfinance loans to convert recipients into active clients, through value propositions that make sense to women.
The “How”: Creating Better Distribution Channels
Finding out which financial products women need, then creating those products, will not make a dent in the financial inclusion gap unless women can access the products. Women’s World Banking will guide providers in eliminating barriers that keep women clients away—by strengthening the agent banking network, offering fully digital services that work for women, and identifying the channels that drive engagement.
Each distribution channel has its own potential challenges that need to be met. Agents need proper training so they can effectively serve women clients; and providers need to find a suitable business model for agents, including a competitive and fair compensation strategy.
Digital solutions such as mobile financial services (MFS) or payment cards at ATMs will not gain traction either unless women know how to use them: clients will need training, and providers must be ready to resolve other digital literacy gaps that come up.
Providers will also need to focus on building out their client networks to include more women. One way is to partner with microfinance institutions (MFIs), which already serve women and can expand the providers’ reach to a wider population of women in Bangladesh.
The “Where:” Usability Makes All the Difference
Even if providers develop tailored financial products and conquer the distribution challenges, a customer journey full of roadblocks will guarantee both clients and providers get nowhere. Figuring out ways to create user experiences that clients will want to return to is a crucial step.
Providers need to hire a team who can earn clients’ trust and build confidence. Simultaneously, elevating women to leadership positions within these financial institutions can also help achieve these goals. Easy-to-understand marketing documents are an important component of the trust-building process. For instance, the menu of options on mobile phones (USSD menus) must grab users’ attention with clear, intuitive language.
Other usability barriers will come to light during the behavioral research process, and providers must make it a priority to overcome those obstacles if they want women clients to become long-term customers.
What will success look like? One measure is a growing number of providers that reach women clients, hire women, and promote them to management positions. Providers will need to hit ambitious financial inclusion goals, such as raising the number of average monthly transactions; reaching 10 percent of Bangladesh’s G2P and remittance recipients; and serving 10 percent of MFI customers and salaried workers in the readymade garment (RMG) industry. These goals are all achievable.
Recognition of Women’s World Banking as the leading voice on financial inclusion and women in Bangladesh will represent another measure of success for the organization. Women’s World Banking is primed to mobilize stakeholders and drive the strategy around financial inclusion, and to ensure those goals stay top-of-mind through an ongoing roster of conferences, events, workshops and publications.
The success of Women’s World Banking’s strategy will be evident in Bangladesh’s success, as the country expands its financial inclusion gains to close the gender gap and speeds up its journey to economic security and prosperity.
Accounts in India have one of the highest dormancy rates in the world. Women’s World Banking undertook research to determine why women aren’t saving actively in a bank and tested prototypes to change that behavior. What we found is that breaking the status quo requires shifting the perception of saving with a bank along with prompting more opportunities to save, leveraging existing mechanisms in their everyday lives.
Like most of the unbanked, low-income Indian women have ways to conduct basic financial transactions outside the formal financial system. For instance, women save in hidden kitchen containers or with a local savings club and take out loans with a local moneylender.
Bringing people into the formal financial system—when they have lived outside it comfortably for so long—isn’t easy. Even well-designed products run into a huge problem: low-income people just don’t see banks as an option for them.
Women’s World Banking’s work in India with Ujjivan Small Finance Bank is a case in point: when the institution started offering savings, very few of their clients were using it because they didn’t see Ujjivan as a place to save.
Low engagement is a national problem
The Indian government has instituted multiple initiatives over the past few years that have drastically improved access to bank accounts for the unbanked: the PMJDY program, demonetization in 2016, and the introduction of payment and small finance banks. Despite the increase in account ownership, India has one of the highest dormancy rates in the world. According to the Global Findex: 48 percent of account holders had not made any transactions in the previous 12 months.
Driving account engagement will have positive effects on women and the institutions that serve them. Women will be able to save their money safely and be able to build cash balances to achieve their long-term financial goals, such as investing in health, education or growing a small business. Institutions deepen their relationship with each customer. Ultimately, better engagement with the 200M underbanked women in India will drive inclusive growth for the country at large.
Many accounts, few transactions
Ujjivan has a group lending customer base of 3.6M women. It transformed from a microfinance institution to a small finance bank in 2015, allowing it to accept deposits to fully serve its clients’ financial needs.
Ujjivan began automatically opening savings accounts for its customers when they applied for new loans. Unfortunately, usage of the savings accounts was low. Women’s World Banking’s analysis of new savings accounts opened in 2017 found that 34-54%* had no transactions at all after the account was opened, tracking with the country’s overall dormancy average.
In order to build a solution to address the dormancy problem at Ujjivan, Women’s World Banking observed and analyzed the financial practices and decision-making of Ujjivan clients. The team found that women are extremely financially savvy, thrifty and usually the ones managing the household expenses and savings rather than their husbands. So why weren’t they saving in their Ujjivan savings account?
A sticky status quo
For one, women have multiple methods of saving that doesn’t involve a bank. They put money away around the house, hiding it from their families to pay everyday expenses. They contribute to chit funds to have access to lump sum amounts when an emergency strikes, and they save in the form of gold to prepare for their daughter’s wedding. Women already have a portfolio of non-bank savings methods that work for their goals. Because these methods work, they stick to their status quo.
Second, if they are saving with a bank, women are saving at the first bank they opened an account. Choosing to deposit in their first bank account is another instance of a sticky status quo. There is no trigger for them to switch to Ujjivan.
Third, because the customers have a borrowing relationship with Ujjivan and it is new to deposit-taking, they do not even associate Ujjivan as a place to accumulate cash for short-term expenses, let alone long-term asset building.
Engagement requires opportunity
Women’s World Banking also found that even among the most well-intentioned of savers, the opportunity isn’t always there. The act of saving is the last thing on Ujjivan customers’ minds: “At the end of the day when all expenditures are paid, not a single rupee is left,” as one customer put it.
Thus, Women’s World Banking determined that prioritizing the act of saving and building that habit must be part of the solution if it is to truly address account dormancy.
Solving for women’s barriers to saving with Ujjivan
Based on these findings, Women’s World Banking determined that the solution for Ujjivan’s dormancy problem had two primary goals: shiftthe customers’ perceptionof saving with Ujjivan and provide opportunities to act, i.e. save..
These research findings guided Women’s World Banking’s development of the solution prototypes, making sure that the proposed solutions work with partner constraints and existing operations. In Ujjivan’s case, this meant delivering solutions through their main touchpoint: the monthly center meeting, which is largely used to collect loan repayments.
Women’s World Banking tested prototypes with Ujjivan customers, including:
The savings punch card: Inspired by loyalty cards, it intends to build a monthly deposit habit at Ujjivan. Women get instant gratification in the form of a stamp for each time they make a deposit at the center meeting. Initial testing was promising: women found the concept motivating and compared the card to a reminder bell or a sticker handed out by teachers when one does well in school.
The double envelope: It nudges women to set some money aside for savings while they are putting money aside to repay their loan. This provides a moment to save while eliminating the hassle to go to the bank branch by collecting it with the loan repayment during the center meeting. During user testing, women reported that the double envelope drove greater awareness of saving.
Gamified savings initiative: Creating excitement around savings can drive deposits. Leveraging group dynamics, gamified savings builds in healthy competition among the group loan customers, rewarding those that deposit the most in their savings accounts. During user testing, women said they were excited about being recognized in their communities by winning.
Heavily branding all these solutions with Ujjivan’s colors and logo and leveraging the preexisting commitment to attending the center meeting (which is already strongly associated with Ujjivan) supports shifting clients’ perception about Ujjivan as a place to save.
Women’s World Banking is going back to India later this year to further test these prototypes and pilot a solution based on these results. The team looks forward to sharing these results on this blog.
If your institution has a savings product with low engagement, here are some initial questions you should start to ask in order to increase usage:
Ability: Are my clients actively saving/ do they have the capacity to save?
Current practice: If they are saving, where do they save?
Brand Association: (Especially if your institution, like Ujjivan, has a lending relationship with clients first) Do they associate my institution as being a place to save money?
Operations: How easy is it to deposit/ withdraw money from my institution? Particularly for low-income women who are time and mobility-poor, having multiple trusted touchpoints is crucial to usage.
Women’s World Banking’s work in India with Ujjivan Small Finance Bank is generously supported by Visa Foundation.
*34 percent for 12-month-old accounts; 54 percent for 6-month-old accounts.