OPINION | Why greater financial inclusion among women benefits lives, livelihoods and economies | Business

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Some empirical evidence suggests that women face far greater barriers than men in accessing finance because of poor credit history or lack of collateral, writes Linda Appie


Despite its devastating global impact, the pandemic had some unintended benefits – especially for women in unserved and underserved communities. 

To bring in money, a significant portion of women in developing economies have depended on domestic/low-income work or run small businesses in the informal sector. Many lost these jobs or their businesses during the lockdown period brought on by Covid-19, putting them and their families in financial crisis. In response, around the world countries’ policymakers and key stakeholders collaborated to increasingly include women financially, largely through digital financial service providers and fintechs. This has been a game-changer.

Enabling women access to the financial sector through digital channels has meant they could access crisis relief scheme support without having to visit a crowded ATM or bank branch, while at the same time benefitting from the low-cost digital banking models that make banking accessible to all. It is  safe to say that digital banking has been a force multiplier for improving female financial inclusion.

Fittingly, the theme for this year’s International Women’s Day is “DigitAll”, with its key focus on innovation and technology for gender-equality. 

This objective is applicable everywhere. In South Africa, women represent 51,1% of the population, while according to the General Household Survey 2021, more than two-fifths of households are run by women, who carry the main financial responsibility. 

Some empirical evidence suggests that women face far greater barriers than men in accessing finance because of poor credit history or lack of collateral. This is changing, as it must, but the rate of change varies dramatically. From countries in Africa, to those in the Middle East and South America, there is a growing acknowledgement that women must acquire greater access to finance and financial services to protect themselves and their families when another crisis strikes. And gender inclusive financial systems will be key in this effort to advance the financial inclusion of women in South Africa and on the continent.

Given the proportion of woman-run businesses in the informal sector, this point is acutely important for our economy’s SMEs. Running a cash business often means there’s no electronic transaction history – making it near impossible for such businesses to get credit or funding. Switching to digital and going cashless certainly increases such opportunities for women in the informal sector.

Out of 477 million new digital accounts opened around the world, 55% were by women. This is true of our data too: when looking at TymeBank’s women vs. male customers, 53% are female. TymeBank is actively driving financial inclusion and literacy among women by making banking affordable, accessible and transparent. We understand the importance of enabling women, particularly since so many head up households; which is why the bank has leveraged its partnerships with supermarket chains (Pick n Pay and Boxer) and fashion retailers (TFG) to have in-store kiosks and agents that engage and activate female customers where they shop. These customers then benefit from the democratisation of banking through our website or app. 

Of course, one needs to consider the cost of accessing digital financial services, as low-income South Africans spend between 18% and 24% of their income on data. High data costs have long been a stumbling block in South Africa, but there are solutions from various fintechs that are making Wi-Fi more affordable, thus more accessible. 

Besides device data, other data is needed to further the successful rollout of financial inclusion among women: research data. With great disparity among different countries, collecting gender-based data has been slow at best, making very little impact on monetary policymaking. In fact, most countries’ regulators are in the very early stages of their journey. If we are to see true change at the highest level, insights into gender provided by FSPs are crucial and should be a focus area among governments. 

The most significant impact of increased financial inclusion is on the economy at large. Stable financial systems rely on people – women and men – to pay and be paid. In and out. Our country’s economy, which is growing at a meagre 1.7%, needs to bring more women into the fold is an essential part of our journey to recovery. 

To deepen financial inclusion in South Africa, there should be gender-specific targets set that ensure that women are reached, and reporting incentives that measure these targets. It will take a collaborated effort from FSPs, fintechs, civil society and government to ensure we are all committed to empowering women to fully participate in our economy.

Linda Appie is te chief marketing officer at TymeBank. News24 encourages freedom of speech and the expression of diverse views. The views of columnists published on News24 are therefore their own and do not necessarily represent the views of News24.



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