Digitising payments of government social benefits and ending the ‘gender gap’ in mobile-phone ownership are among the recommendations made in a report that aims to boost women’s digital financial inclusion.
‘Reaching Financial Equality For Women’, put together by organisations including United Nations (UN) agencies and the World Bank, is built around a 10-point ‘action plan’ for governments and businesses to help economies and societies to recover from Covid-19. Its proposals ultimately aim to ‘end the continued economic exclusion of half the world’s population and to build more resilient economies’.
Coronavirus will lead to the first increase in extreme poverty since 1998, according to World Bank research published last year, which pointed out that a ‘large share’ of the new extreme poor will be concentrated in countries that are already struggling with high poverty rates. Almost half of the projected new poor will be in South Asia, and more than a third in Sub-Saharan Africa.
Meanwhile, at least 47 million more women and girls will fall below the poverty line in 2021, with at least 247 million women aged 15 and over in extreme poverty, according to a UN Women report. The pandemic’s economic impact will also endure longer for women as they disproportionately work in the informal sector and are less likely to qualify for government relief services, the report notes.
Further recommendations in the ‘Reaching Financial Equality For Women’ publication are: the digitisation of private sector payments; outlawing discrimination against women; ensuring universal access to identification; hiring more women at banks and mobile network operators; collecting, disaggregating and using sex-disaggregated data; designing appropriate and affordable financial products for women; helping women benefit from e-commerce opportunities; and creating and enforcing strong digital finance consumer protection mechanisms.
Ghana pushes for fintech take-up
The 28-page report – which also incorporates a list of proposed indicators to track progress against its 10 actions – was launched at an online panel discussion on International Women’s Day (8 March), with participants including and Bank of Ghana governor Dr Ernest Addison and Indonesia’s finance minister Sri Mulyani Indrawati.
Addison outlined a string of developments in Ghana aimed at encouraging digital payments, including 2019’s Payment Systems and Services Act and the bank’s creation last year of a Fintech and Innovation Office.
He said the new office was “working with many fintech providers to provide products that are appropriate and affordable to address the question of financial inclusion”. He cited a recently licenced product allowing ‘remote’ account opening designed to appeal to young people and women; a ‘digital microcredit’ offering targeting the same demographic (“all you need is a mobile-money account and ID”); and ‘Chat Banking’ involving the use of WhatsApp (“this is very appealing to young people and especially helps younger women to access financial services”).
Addison also referred to Ghana’s universal QR (or ‘Quick Response’) code, launched in 2019, as well as tiered know-your-customer (KYC) requirements for mobile-money wallets as having encouraged digital payments. The Bank of Ghana is, he added, using new regulatory analytics and surveillance software that would provide disaggregated data to enable the central bank to design more gender-specific policy interventions.
Indrawati described Covid financial relief measures in Indonesia, such as the subsidisation of electricity for the poorest households, as well as moves to encourage digital payments among small- and medium-sized enterprises, which, she said, are disproportionately owned by women. “We are also establishing a holding company for micro finance, which will increase the access of the ultra-micro [businesses] to access capital with a lower interest rate,” Indrawati said.
Accelerate investment in ‘digital public goods’
The panel discussion was preceded by remarks from Queen Máxima of the Netherlands. Speaking in her capacity as the UN secretary-general’s special advocate for inclusive finance for development, she urged for more to be done to use technology to help with financial inclusion.
“Many governments responded to the crisis by providing funds to citizens through digital channels,” she said. “Digital deployment offers the opportunity to deposit funds directly into women’s accounts. This pivots away from cash, which can be unsanitary, and provides women more control and privacy. It can also enable massive account openings, paving a path to explore other digital financial services, such as remittances,”
Queen Máxima encouraged governments to increase their investment in ‘digital public goods’. “It is impossible to send cash safely and swiftly to a woman who has no formal identification, does not appear in public databases, or has no access to a mobile phone with a secure internet connection,” she said. “It is therefore now more important than ever to accelerate investments in this infrastructure to help women enter and participate in the formal digital economy in a very safe manner.”
But many lack access to a mobile phone or an internet connection, while reliable and affordable data and connectivity to use mobile financial services are required. “The problem is particularly acute in Sub-Saharan Africa where there is a 41% gender gap in mobile internet use. This, while the region is home to four of the world’s top five most expensive countries for mobile data,” she said.
The report was co-produced by New York City-headquartered NGO Women’s World Banking, the UN-hosted Better Than Cash Alliance, UN Capital Development Fund (UNCDF) and UN Women, as well as the World Bank.