Financial inclusion Putting women and youth in the picture
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INSIGHT | EMPLOYMENT AND GROWTH PROGRAM
Financial inclusion
Putting women and youth in the picture
Financial services can help the
world’s poor to prosper. With access
to loans, savings, and insurance,
people are better able to manage
risks, save money for emergencies,
and invest in education or business
opportunities.
A growing number of people are now
benefitting from financial products
and services. According to the Global
Financial Inclusion Index, the propor-
tion of adults worldwide with access
to formal financial services rose from
51 percent to 62 percent in only
3 years (2011 to 2014).
KRISTINA JUST
Yet, more than two billion people
remain without access to a financial Access to financial products and services can help women and youth to save,
account. Women, the poor, and youth invest and plan for the future.
face the greatest barriers. In develop-
ing countries, only 37 percent of
women have a bank account as do
Seeking evidence-based
solutions
Inside:
less than half of the poorest
■ Fostering demand for
40 percent of households.
Through our Employment and Growth financial services
The gender gap in account ownership program, Canada’s International ■ Spurring innovative products
is not narrowing either. And globally, Development Research Centre (IDRC) and services for women
supports research on financial and youth
only 46 percent of youth between
15 and 24 have a bank account com- inclusion as a tool for economic ■ Creating enabling policy
pared to 66 percent of adults aged 25 empowerment and sustainable liveli- frameworks
and over. hoods. Focusing on the needs of ■ Informing local practice and
women and youth, we invest in global debates
Closing the gaps in access to and use research that aims to:
of financial services demands careful
attention to their design and delivery. • foster and scale up access to and impede access for these groups, in
Financial education and consumer use of financial services among partnership with regulators; and
protection need to be enhanced to marginalized groups, including
foster the use of financial services by through financial literacy; • help banks and financial service
marginalized women and youth. providers develop innovative prod-
• inform enabling policy frameworks ucts and services that better reflect
and remove the constraints that the needs of women and youth.
I N T E R N AT I O N A L D E V E LO P M E N T R E S E A R C H C E N T R E
In Latin America, research supported more likely to take part in community
by IDRC has demonstrated the value decisions. Further research supported
of financial education, and of tying the by Proyecto Capital and through the
use of savings accounts to the distribu- Partnership for Economic Policy (PEP)
tion of social benefits — such as con- illustrated the potential use of telenov-
ditional cash transfers (CCTs) — to elas (soap operas) as a popular educa-
low-income families. Globally, at least tion tool for financial literacy. Women
33 countries use CCTs to fight poverty. who viewed the tailored telenovelas
By making these transfers through a better understood the benefits of sav-
savings account, governments can ings, and demonstrated more control
ALLIANCE FOR FINANCIAL INCLUSION
give millions of households access to over economic decisions within their
formal financial services. Research con- households.
ducted through Proyecto Capital
found that linking CCTs to savings Two million people — mainly women
accounts brings millions of excluded — in 14 countries have gained access
individuals into the formal financial to financial services and strengthened
Millions of low-income families system and enhances the welfare ben- their ability to manage their money
benefit from conditional cash transfers efits of the cash transfer programs. thanks to Proyecto Capital. In its latest
received through savings accounts.
phase of research, supported by IDRC
In Peru, an evaluation of a savings pro- and the Ford Foundation, the project
Partnership is key to our approach: motion pilot program for rural high- aims to benefit 10 million low-income
supported research engages a wide land families showed that providing Latin Americans in 16 countries by 2020.
range of stakeholders, including finan- financial education along with cash
cial institutions, non-profits and social transfers made a significant difference
enterprises, and government and Spurring innovative products
in savings, investments — and self-
community-based organizations. In confidence. Participants, mainly
and services for women
addition to investing in locally-led Quechua-speaking women, were and youth
research which informs local policies 12 percent more likely to save money,
and solutions, we support peer learn- There is a growing evidence on the
15 percent more likely to use a bank,
ing and knowledge sharing. We also economic benefits of increasing
and 11 percent more likely to purchase
facilitate links with global platforms so financial services for women. How-
large livestock. The women were also
that supported research teams and ever, many banks and other service
practitioners can present evidence and providers are unaware that women
share experiences to inform interna- constitute a unique and significant
tional debates on financial inclusion. market opportunity, and lack informa-
tion on how to serve and attract
CAROLINA ROBINO
women as clients. Banking fees and
Fostering demand for
the lack of appropriate services are
financial services key barriers to financial inclusion for
“I’m happy, because when you don’t women and youth.
Millions of low-income people lack the
have anything, you’re sad. ... And you
knowledge and resources to access
have to ask your husband for money. To address these gaps and spur inno-
and use formal financial services. With
little trust in institutions, the poor ... Now I have a little money of my own vation, IDRC is collaborating with the
instead tend to rely on informal credit in the bank and I don’t have to ask him Global Banking Alliance for Women
for anything. When I need something, (GBA). The partnership will raise
and savings tools. Building their finan-
I go to the bank and take it out.” awareness and build the capacity of
cial literacy and skills can remove such
financial service providers to better
barriers to access and help extend — Fidencia Navio, beneficiary of Proyecto meet women’s needs. GBA member
services to the poor. Capital financial literacy training
INSIGHT | EMPLOYMENT AND GROW TH PROGRAM
institutions — which include multina-
tional, regional, and local banks in
more than 135 countries — offer
women access to financial products
and services, markets, business infor-
mation, education and networking
opportunities.
In Africa, where gender gaps in access
to finance persist despite the rapid
growth of mobile banking and other
innovations, a new IDRC partnership
with Financial Sector Deepening
Africa is harnessing existing financial
surveys and the emerging power of
IDRC
“big data” to help service providers
improve their offerings for women Women-focused financing training and services yield important economic
and youth. Piloted in Tanzania and and social benefits. When women have control over their finances, they are
empowered to make better decisions for themselves and their families.
Sierra Leone, this pioneering work
brings together local researchers,
financial experts, and private sector Creating enabling policy financial regulators and policymakers
providers — including banks, insurers, in almost 100 developing countries.
frameworks
and mobile banking operators — to Through FILAC, they are gaining
make the business case for investing Regulations and policies are also key expertise to inform the development
in data use and analysis. to creating an environment that fos- of gender-sensitive National Financial
ters inclusion in financial services. Inclusion Strategies, digital financial
“The marginalised in underserved Banks in many regions, for example, services, and consumer protection
markets within the financial sector are must meet rigid “know-your-client” and empowerment policies. FILAC
no longer anonymous. The amount of guidelines which demand that cus- works with members to promote the
information and data on these market tomers provide formal identification capture and use of gender-disaggre-
and proof of address. While intended gated data to better understand
segments has grown considerably
to increase financial stability and secu- women’s needs. The participating
over the years. Using data analytics to
rity, such rules can inadvertently deny Central Bank of Haiti is now weighing
develop insights into customer prefer-
services to the most vulnerable. this approach for the first time.
ences can be a powerful spur to
financial inclusion”. In 2016, IDRC and the Alliance for “In the Central Bank’s current training
— Mark Napier, Director of Financial Financial Inclusion (AFI) launched a programs for financial institutions on
Sector Deepening (FSD) Africa partnership to develop a regional peer how to treat customers, there is no
learning platform for AFI member element of understanding cultural
The goal is to nurture innovations that institutions in Latin America and the differences or gender behavior.
will remove financial barriers limiting Caribbean. The resulting Financial
Participating in AFI and getting
the productive potential of women, Inclusion Initiative for Latin America
youth, and other marginalized groups.
feedback from the peers has resulted
and the Caribbean (FILAC) provides
The project will test measures that can in a greater understanding on the
research, peer learning, and technical
be scaled up to ten other countries in assistance to help policymakers need to incorporate these consider-
three years. develop more inclusive policies and ations in the training programs.”
regulations, with a specific focus on — Mrs. Mireille Brunings-Stolz, Director,
women’s needs. AFI members include Center for Financial Education and
Development, Central Bank of Suriname
central banking authorities and other
EMPLOYMENT AND GROW TH PROGRAM
Informing local practice
and global debates
IDRC-supported research generates
local evidence on financial inclusion
and informs local policies. We also
partner with international platforms so
that supported research and evidence
contributes to global debates on
financial inclusion. Lessons and find-
ings resulting from our partnership
with AFI, for example, will feed into a
series of discussions leading up to the
G-20 Global Partnership for Financial
Inclusion.
IDRC
Digital innovative products are helping to improve women and youth’s Supported researchers are achieving
financial literacy and their access to financial services.
global voice and recognition. Thanks
in part to the wide-scale impact of
Researchers with Proyecto Capital With chapters in 16 countries, NFNV Proyecto Capital, project co-leader
have worked with governments in engages with financial institutions and Yves Moury of Fundación Capital was
Chile, Paraguay, and Peru to inform the other decision-makers at national, internationally recognized as a 2017
development of National Financial regional, and global levels to increase Social Entrepreneur of the Year.
Inclusion and Education Strategies women’s access to services and Carolina Trivelli, another lead researcher,
that aim to remove barriers and expand their leadership in the financial now chairs the Consultative Group to
enhance access and use for women, sector. New research will explore con- Assist the Poor, a global partnership
youth, and other disadvantaged straints and opportunities on both the that seeks to advance financial inclusion.
groups. The project is training policy- demand and supply side of the finan-
makers so they can better address the cial services sector. Through policy Financial inclusion is not an end in
needs of the most vulnerable. framework analysis and focus group itself: it is a means of improving liveli-
discussions with male and female hoods for the poor and marginalized.
In Francophone Africa, less than entrepreneurs, research will help policy- IDRC’s work will contribute to maxi-
13 percent of the adult population has makers in Cameroon, the Democratic mizing the development impact of
a bank account. Women’s concentra- Republic of Congo, and Senegal financial inclusion to foster opportuni-
tion in the informal sector makes them address barriers in the current ties for women and youth.
even less likely than men to have regulatory environment.
access to institutional financial serv-
ices. A partnership with New Faces
New Voices (NFNV) – a Pan-African Employment and Growth
advocacy group – is exploring ways International Development Research Centre
to tackle gender gaps in access to PO Box 8500, Ottawa, ON
Canada K1G 3H9
finance in Francophone Africa. Phone: +1 613-236-6163
Fax: +1 613-657-7749
Email: eg@idrc.ca
www.idrc.ca/eg
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