Gender equity and Financial Inclusion: the winning double
Many research publications and reports have shown that closing the gender gap in financial inclusion has direct positive effects in “smoothing consumption, lowering financial risks and costs, providing security, increasing saving and investment rates, and facilitating new business opportunities”. Closing the gender gap is an enabler for financial inclusion and also for countries’ development and economic growth as a whole.
Despite progress in the past twenty years, women still face multiple barriers that limit their access to – and use of – financial services, such as lack of an ID to prove identity, mobility constraints, lack or default of collateral… Multiple measures can be taken to address those issues. Fintech, financial institutions and policymakers have a role to play. If financial technology solutions have proven their potential to enhance financial inclusion, it is not yet there for closing the gender gap. According to a World Bank survey: “29% of men that answered the survey use fintech, while only 21% of women do, creating a gap of 8 percentage points”. This survey highlights that financial technology alone is unlikely to close the gender gap in access to financial services. Instead, the fintech revolution may need the support of targeted policy initiatives.
In 2016, The Alliance for Financial Inclusion (AFI) adopted the Denarau Action Plan. This initiative is driven primarily by policymakers and regulators from developing and emerging countries committed to taking tangible actions and providing leadership toward closing the gender gap globally. The options and effort can go from “pushing forward regulations that promote KYC and AML, simplified accounts, the development of alternative collateral registries, and support the development of fintech companies that could create new mechanisms to serve women’s financial needs”. The Denarau Action Plan was supposed to end by 2021, but there is still a long road ahead.
“Financial Inclusion that Works for Women”: 2022 European Microfinance Award in Luxembourg
As such, this year, the European Microfinance Platform (e-MFP), the leading network of European organisations and individuals active in the financial inclusion sector in developing countries, has decided to devote the 2022 European Microfinance Award to “Financial Inclusion that Works for Women”. This prestigious award will highlight organisations working in financial inclusion that aim to understand and meet women’s challenges and aspirations beyond traditional gender outreach strategies.
The European Microfinance Award is part of the European Microfinance Week (EMW), hosted by e-MFP, in Luxembourg. It is one of the top events in the financial inclusion arena and is critical for gathering microfinance and financial inclusion professionals working worldwide. Working towards closing the gap between gender equity and financial inclusion, the e-MFP team came up with a straightforward but valuable question: “When it comes to financial inclusion, women face multiple, compounded barriers, is your organisation working to overcome them? Trying to solve the problem by bringing together various solutions on the table, e-MFP will offer €100,000 to the winner and €10,000 to the two runners-up to reward excellence and collect and disseminate the most relevant practices for replication by others.
The application process for the European Microfinance Award is now open until April 12th. All the info is available here: https://www.european-microfinance-award.com
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