Breaking the Gender Bias in Finance
Financial inclusion is critical in breaking the poverty circle for women as it helps them access many forms of credit facilities, help them with saving money, accumulate assets. However, despite the progress being made to improve the status of financial inclusion for women,Ā World BankĀ reports indicate that there is still a gap between women and men, especially in low- and middle-income economies.Ā “Men are 9 per cent more likely than women to have an account, a gender gap that has stubbornly persisted.”Ā Our financial inclusion studies have also unveiled that women’s experiences in applying for finance are often tedious, very tough, a scam due to the red tape, sketchy and putting a lot of strain on small businesses. This year, the GraƧa Machel Trust commemorated International Women’s Month by highlighting this critical issue under the themeĀ Breaking the Gender Bias in Finance.Ā
On 10th March, the Trust’s Expert Leaders Group convenor Ms Elsie Addo Awadzi, the Second Deputy Governor of the Bank of Ghana, joined a high-level webinar dialogue hosted by the Toronto Centre. Her reflections on Women’s Leadership in Financial Inclusion and Economic Recovery focused on how financial inclusion helps combat bias and break the barriers to gender equality and the role of monetary authorities in supporting positive change.Ā
Toronto Centre Program Leader, Jennifer Long, moderated the session and highlighted the 2017 Global FinDev survey that revealed a Gender Gap in access to finance, which is still 9 per cent in developing economies. She asked Ms Awadzi, “So can Central Banks and Supervisors make a difference in closing the Gender Gap?” In her response, Elsie Addo Awadzi pointed to the role played by regulators in adding value to the economy. “Regulators need to balance safety and soundness with why we issue licenses to institutions. Whether you look at the game’s rules or the approaches employed, the gender approach is key,” she said.Ā She added that regulators need to start with data, obtain data in a granular way that allows us to assess understanding.Ā
For example, in Ghana, MSMEs constitute 44% of women, and 70% of GDP is contributed is by MSMEs. When women do not have access to finance, how will they be critical engines of growth for the country.” This was echoed by Irene Espinosa Cantellano, Deputy Governor, Bank of Mexico, who shared how Mexico is working towards reducing the gender gap in the financial sector.
How can Regulators help? Key highlights from Elsie Addo AwadziĀ
“Loan books may look good, the savings account may look good; however, how many makeup women as customers”Ā
- Invest in infrastructure to invest in collecting granular data.Ā
- Look at how many complaints from financial service providers are from women and understand the nature of the complaints.
- Look at online marketplace lenders, and how many of these are attributable to women versus men.Ā Ā
- Enable technical innovation for financial service providers, becoming a fundamental game-changer for digital financial inclusion.
- Create an enabling environment that allows women entrants that are traditionally not permitted into the payments ecosystem as women everywhere have access to a mobile phone which many can access critical financial services these days.
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“It takes a lot to calibrate a regulatory regime that allows you to promote safety and soundness in the financial system and financial inclusion and integrity”Ā
Elsie Addo Awadzi is also a member of the Expert Leaders Group (ELG) on Women’s Financial Inclusion in the Digital Economy in Africa under the GraƧa Machel Trust. The Trust convened the ELG consisting of female Deputy Governors of Central Banks (finance regulators) and senior financial sector leaders to elevate the voices of African women. These priorities help build inclusive economies and institutions that respond to the needs of women. The ELG represents the five regions in Africa and collaborates with the Trusts’ Women’s sector-based Networks to build stronger political will and investment in a COVID-19 recovery agenda that is gendered and promotes accountability for action. The Trust’s Networks will provide a solid national footprint and jointly work as a collective of actors as an ecosystem for change.Ā
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The Nutrition and Reproductive, Maternal, New-born, Child and Adolescent Health and Nutrition, (RMNCAH+N) of the Childrenās Rights and Development Programme aims at promoting the Global Strategy for women, children and adolescentsā health within the Sustainable Development Goals (SDG) agenda. The strategy emphasises on the importance of effective country leadership as a common factor across countries making progress in improving the health of women, children and adolescents.
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