The launch of the Global Findex in 2021 showed that the global gender gap in access to finance had reduced to 4 percentage points for the first time in a decade, although developing economies still showed a higher gender gap at 6 percentage points.
Women’s participation in the economy and the cascading positive effects on the well-being of their family, society, and economy are well researched and form a core part of the work on women’s economic empowerment globally. However, the global gender gap for economic opportunities is wider than previously thought.
Multiple studies have shown that enabling access to and usage of digital financial services (DFS) can have a positive impact on women’s lives by increasing household consumption and spending, promoting household savings, and helping smooth spending when faced with shocks. However, this can result in an increase in decision making by women at home, in workplaces, and in society more broadly, and challenge extant social norms. Most literature on inclusive finance suggests that norms are an enabling factor for women’s empowerment.
What Does Being Gender Intentional Mean?
Evidence shows that access to and usage of digital financial services can help women shift to more secure and productive types of employment and allow women who were previously excluded from the labor market to get productive employment opportunities. However, there is merit in considering gender intentional approaches that would engage all stakeholders impacted by this change to be more reflective so there isn’t pushback from groups that feel threatened by shifting norms. Being gender intentional also means that society sees women’s economic empowerment as beneficial and thus a positive-sum game where everyone benefits, rather than a zero-sum game.
What does this mean in practice?
Being gender intentional requires us to show the impact of including women and being more intentional about women’s representation and participation in designing and delivering financial services.
Being gender intentional requires us to show the impact of including women and being more intentional about women’s representation and participation in designing and delivering financial services.
Depending on the stakeholder group being represented, gender intentionality translates into different things. For investors, it means increasing representation of women fintech founders and consumers in their portfolios. This requires being aware that women are less represented in the consumer portfolios of fintechs and taking steps to create a supportive ecosystem that would encourage participation. For instance, a recent study from IFC found that more than half of the fintech firms surveyed reported that less than 25 percent of their customers are women. Women-led fintech founders get less than 2.4 percent of venture capital funding, but on the flip side, investing in women-run businesses can unlock US $31 trillion for the economy.
Gender intentionality for regulators can mean being more gender aware so they account for norms and work on regulations that can help address them. This requires access to data, as CGAP pointed out in their guidance to regulators on being gender intentional. For instance, in Mexico, access to data allowed regulators to realize that women were discriminated against, since they received loans with a larger spread and lower average credit amount compared to men. To incentivize providers to lend to women, the Banking and Securities Commission of Mexico responded by introducing a regulatory reform that reduced the loan loss provisions required for loans to women.
For policymakers, UNCDF’s policy accelerator lab achieves gender intentionality by anchoring gender in policy design, facilitating inclusive participation and power through representation. Women’s World Banking works with policymakers at the G20’s Global Partnership for Financial Inclusion, providing a 10-point action plan for being gender intentional.
There is still limited research on how to build a safe and secure online environment for women where they feel confident submitting complaints and seeking redress once they have access to digital financial services.
While to date, policy initiatives have focused on addressing structural and normative barriers that prevent women from accessing digital financial services, there is still limited research on how to build a safe and secure online environment for women where they feel confident submitting complaints and seeking redress once they have access to digital financial services. Online safety and security can pose a barrier to the ongoing use of digital financial services, and studies have shown that women DFS users in Africa and South Asia are more vulnerable than men to cyberfraud and social engineering scams. In the United States, one in four women face online harassment of some form, and the United Nations estimates that 95 percent of online aggression, harassment, abusive language, and denigrating content is directed towards women. This is an important statistic to consider in the context of creating gender intentional channels and safe spaces for women online. Ongoing research suggests that social media complaints are likely to be addressed faster than complaints through other channels; however, women tend not to use social media out of fear of retribution and online harassment. Women face other challenges as well — they are twice as likely to have their identity stolen and less likely to complain about issues they face.
An important stakeholder group to also consider are the digital financial services providers who interact with women consumers. There is inherent value to both women and DFS providers in developing gender intentional approaches to consumer protection. While there is extensive research on risks, there is limited research on the topic to help understand gender intentional solutions that can help create safe digital environments for women to access and use financial services. This gap in research and the ability to test and develop redress channels and create online safe environments that women feel safe to use need to be filled urgently if we are to close the gender gap.
Beyond institutional stakeholders, we need to involve men at all levels of society — across workplaces and homes.
Beyond institutional stakeholders, we need to involve men at all levels of society — across workplaces and homes. Patriarchal cultures view men as the gatekeepers of power and resources, and fail to acknowledge that they might suffer from fears and anxieties, which prevent them from asking questions and make them feel insecure. This insecurity can translate into apathy or toxic behavior. If we are to genuinely reduce the gender gap in the economy and in using digital financial services, we need to create safe spaces for men to fumble through tough conversations and address gender norms.
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