The rise of gender finance

“A successful implementation holds the promise to unfold the huge potential of women in driving sustainable growth and eradicate poverty through enhanced financial inclusion” – Dr Alfred Hannig, Executive Director – Alliance for Financial Inclusion


For generations, there has been widespread prevalence of economic and social barriers that inhibit empowerment and economic inclusion of women in the global economy. There is extensive number of literature that discusses different challenges women face in their quest for equality particularly in terms of access to finance irrespective of their socio-economic, demographic, and geographical circumstances. In the pursuit of sustainable financial inclusion, addressing this gender gap in terms of access and usage of financial services is one of the key priority areas amongst policymakers. Currently, there are over 1 billion women globally who are financially excluded from the formal financial system. Thus, the only way to have a genuine inclusive financial system is to incorporate gender dimension to financial inclusion strategies and goals.

During the Alliance for Financial Inclusion (AFI) Global Policy Forum (GPF) held in Fiji this year, the Members of the AFI endorsed the Denarau Action Plan. At the heart of this plan is the commitment to close the gender gap in financial inclusion. As policymakers implement the Denarau Action Plan, there is a need to have an overarching “gender lens” approach to this. This means advancing the agenda of women’s financial inclusion whereby financial service providers serve women by acknowledging them as viable investors with a strong business case. It also assists regulators in identifying gender specific policy gaps and addressing it with innovative smart policy solutions. The idea is to empower women using a collaborative model. This signals to all the relevant stakeholders that both men and women have crucial roles to play in reaching those 1 billion unbanked women around the world. This proactive approach is more holistic and not only focusses on access to financial services; it emphasises on designing policies with women for women.

However, there is no universal approach in solving this gender disparity when it comes to accessing financial products and services. As a result, different jurisdictions and regions need to tailor their strategies accordingly taking into consideration the larger cultural and political landscape. Hence, the goal would be to redefine financial inclusion for women through affordable and accessible finance, revolutionary products, improving financial competency, and opportunities for growth.

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Access to finance is a key pillar in assisting women and women-owned SMEs in achieving economic and self-empowerment whilst lifting oneself out of poverty. Making accessible and affordable financial products and services available to women - whether it’s a savings or credit product can be a catalyst in encouraging entrepreneurship and promoting sustainable livelihoods. There is a need to re-look at the regulatory environment to encourage more women into the formal channels of savings and borrowing.

Innovative products and channels such as digital savings can be an effective means of increasing access and usage of financial services by women. Financial service providers need to build their capacity in terms of conducting market research in identifying needs and preferences of women in terms of financial services. Gender-disaggregated data will be crucial to this process. There is scope for donor and developmental partners to explore partnership with financial institutions in delivering customised products and services for unbanked and underserved women.

Financial Literacy becomes an integral skill as we promote financial inclusion amongst the vulnerable group including the underserved women. Being financially literate or competent enables one to make an informed decision and minimises the risk of over-indebtedness. It empowers women to carefully assess different options and choose a product or service that meets her needs. Lack of financial literacy skills is one of the key barriers women face in developing and small island development states.

Therefore, one thing is clear is that advancing the agenda of gender finance will require a multi-stakeholder approach with women being at the helm of this movement. Moving forward, innovation would be a key in supporting women to proactively grasp their full economic potential. Bold reforms and policy instruments such as quotas need to be explored (if need be) to start the conversation on the need for a more inclusive financial system.  It’s high time we #BankOnHer

Sameer is a One Young World Ambassador and Senior Analyst  at the Reserve Bank of Fiji.

Published on 08/12/2016