Despite the great strides made to accelerate global financial inclusion in recent years, women are still more excluded and harder to reach with financial services than men in most developing countries. Many women run small businesses from their homes and are more likely to be shut out of the formal economy. Women often have fewer opportunities to gain an education, earn an income outside of their household, own land, inherit assets, and control their own income and financial futures.

In many developing countries, social norms continue to hold women back. From beliefs that women are meant to be caregivers and shouldn’t spend their time running a business to a reluctance to trust women to make financial decisions at all, these norms perpetuate gender gaps. In many Middle Eastern countries, opening an account requires approval from a male guardian. Furthermore, while mobile phone access continues to grow rapidly across the developing world, women are less likely than men to be digitally and financially literate or to own phones.

When it comes to lifting families out of poverty, fighting hunger, and educating the most vulnerable children, it’s crucial that we find ways to support women microentrepreneurs and small business owners. When women are able to earn a secure income, they are more likely than men to spend it on child welfare, including school tuition and medical care, household utilities, and food. Financial security also tends to empower women, giving them a role in the decision-making process in their households. Beyond empowerment and poverty reduction, supporting female entrepreneurs boosts economic growth, with estimates suggesting that advancing women’s equality can add $12 trillion to the global economy.

Innovative products and services, including new digital financial service offerings, can help us reach more women and close the financial inclusion gender gap. Fintech is already playing a major role in closing gender gaps in Middle Eastern and African countries. In Côte d’Ivoire, for example, women are just as likely as men to have a mobile money account, while men are twice as likely as women to have a traditional bank account.

However, in many Asian and Latin American countries, traditional financial inclusion services tend to do more to close gender gaps than digital ones. Part of the variation across countries can be explained by obstacles that digital tools cannot directly overcome, such as social and cultural norms. Regulators can play a role in shifting norms by introducing legislation promoting gender equality while taking into account the beliefs and the contextual constraints that shape those norms. For example, they could remove any regulatory barriers that restrict women from having their own bank accounts.

Nevertheless, digital solutions appear particularly well adapted to the other constraints women face. We’re supporting an array of financial service providers that bundle digital financial products with the educational services needed for women to gain the skills and comfort needed to use them properly.

Our partner DAWN Microfinance in Myanmar — where the population has rapidly adopted smartphones in recent years — embraced their own digital transformation and is now implementing digital field applications to help loan officers better serve their clients, most of whom are women. DAWN is also leading training sessions to reach the women-led businesses that lack access to formal financial services. No longer having to undertake much of the loan process manually, loan officers can spend more time finding and supporting clients.

Daw Amar Myint prepares delivery meals from her restaurant in Yangon, Myanmar.

“Finally, I can spend more time with my customers,” DAWN loan officer Aye Aye Myint tells us. “The women we are helping now are running their own businesses. They are standing on their own two feet … some women can now rent and open big stores when they used to have just small shops.”

Daw Amar Myint, a client of DAWN, owns a small restaurant serving up traditional Myanmar cuisine in Yangon, Myanmar. When the pandemic hit, she was forced to close her doors and turned to social media to sell delivery meals online instead. Because she’s able to sell online, she’s better positioned to withstand the pandemic. DAWN is giving their small business clients like Daw Amar increased support and flexible payment options so they can overcome this crisis and thrive into the future.

Ovante, our award-winning digital business education platform has made a major impact on the lives of women entrepreneurs across Latin America. Using interactive tools, including videos and techniques like gamification, Ovante helps users become more financially and digitally savvy. 92 percent of its users say it is their first time using a digital platform.

Margarita, one of over 12,700 woman entrepreneurs Ovante has supported, significantly improved her florist business using the financial and digital concepts she learned from the platform. Ovante is providing her with exposure to digital technology as she learns how to organize her finances, reach new customers, and use social media marketing and branding. Entrepreneurs can complete Ovante’s online modules at home at a time that best suits their schedule. In discussing why flexibility matters to her, Margarita exclaimed, “I think it is very helpful that Ovante is digital because you can use it anywhere! It also solves the problem of limited availability of time because there is no set time to use this platform, which makes it more convenient.”

Karen Yesenia Torres Villamizar and her family own a bakery in Bucaramanga, Colombia. Because her business had always been cash-based, and Karen only sold to her customers in-person at her physical store, she had to adapt quickly during the pandemic. Because she gained the knowledge and confidence to use digital tools from Ovante, Karen found a way to keep her business open for delivery by promoting and selling her sweets online.

Innovative financial products and services can help women entrepreneurs like Daw Amar, Margarita, and Karen overcome the digital and financial literacy barrier that many women face. When financial service providers can develop digital tools that can be used entirely from home, without the need for face-to-face interactions that might otherwise prevent women from accessing them, more doors open for women entrepreneurs. However, providers must consider how they can develop products to reach women who don’t have reliable access to smartphones and digital tools, otherwise, they risk worsening the digital gender divide. As women become financially empowered by new opportunities, they can break through arbitrary barriers they have faced because of their gender. While financial providers may not be able to address cultural and social norms head-on, they can play a critical role in helping women overcome them.

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