Financial inclusion for women gathers momentum

The Reserve Bank of Zimbabwe (RBZ) is stepping up efforts to improve financial inclusion for women in line with the 2030 sustainable development goals.
According to figures from the central bank, the proportion of banking sector loans to women is on a steady increase with the ratio improving from 8,18 percent in December 2017 to 9,17 in March 2018.

The value of loans to women in March was US$316 million, a significant improvement from US$224 million recorded in 2016.

By close of the quarter, 1 486 060 women had bank accounts, compared to 769 833 in 2016 as Government continues to work towards enhancing financial inclusion for marginalized women.

The introduction of agency banking enhanced access to financial services, particularly for women in the rural areas. Women also benefitted from the introduction of lite bank accounts (low cost accounts) as most of them were failing to open bank accounts as a result of onerous minimum requirements.

RBZ deputy governor, Dr Jesimen Chipika told The Sunday Mail Business that the apex bank is on a drive to support women’s participation in the economy and financial inclusion is one of the pillars for this strategy.This year, the RBZ launched a US$15 million facility for female entrepreneurs.

Dr Chipika said the bank will continue to review such facilities in line with demand as well as increase their accessibility to women. The 2030 SDGs prioritises financial inclusion, ending poverty, promoting economic growth, gender equality, emplyment creation as well as promoting inclusive and sustainable economic growth.

“The importance of improving financial inclusion for women is receiving an increasing amount of attention by the Reserve Bank of Zimbabwe,” said Dr Chipika via email.

“The RBZ will, in the process of implementing the National Financial Inclusion Strategy, continue to review the facilities taking into account performance, demand and availability of resources in order to inform policy regarding access to financial resources for targeted beneficiaries including women,” she said.

According to Data2X, an organization led by the United Nations Foundation, globally, there is a gender gap in financial inclusion where women are 7 percent less likely than men to have a bank account. Further, even when women have full access to banking services, they face much greater challenges in obtaining services that meet their needs. Data2X notes there is an estimated US$300 billion credit shortfall for small and medium-sized women-owned enterprises in emerging economies the world over, and women are also more likely to be dissatisfied with banking services.

Dr Chipika said the RBZ is cognizant to the fact that the financial inclusion agenda cannot be accomplished without giving attention to the inclusion of women.

As a result, the apex bank will continue to enhance support and capacitation of women.

“The Reserve Bank continues to spearhead implementation initiatives targeted at minimising constraints and challenges to the inclusion of disadvantaged groups as well as promotion of access to and increased usage of financial services by all economic agents.

“Access and usage of financial services are levers for increasing women’s participation in the economy. Women play multiple roles as economic actors and caretakers of their families, thus women’s financial inclusion has multiple benefits, both at the enterprise and household level,” she said.

Research has also shown there are significant benefits in terms of economic growth, greater equality and societal well-being whenever women participate in the formal financial system. According to a recent Gallup-International Labour Organization (ILO) study, global GDP could increase by US$5,3 trillion by 2025 if the economic gender gap was reduced by 25 percent.

However, concrete steps are needed to enhance women’s financial                                inclusion and empowerment in order to narrow the economic gender gap and foster sustainable development.

In the African region, the percentage of female entrepreneurs in the formal economy is smaller, relative to other parts of the world.

However, Sub-Saharan Africa has high levels of entrepreneurship with the proportion of male-owned businesses to female-owned businesses being roughly the same.

Yet female entrepreneurs continue to receive only a small fraction of the total capital available for small to medium entrepreneurs across Africa as they face a host of challenges. These include lower levels of education and financial literacy, lower income levels, lack of tangible assets or collateral, legal constraints, time and mobility constraints, socio-cultural constraints, inter-role conflicts from juggling domestic and professional roles and a lack of market exposure. Lack of access to financial assistance has been the most common constraint in Zimbabwe, the region and globally. Dr Chipika said the RBZ is also collaborating directly with development institutions in promoting women’s access to financial services.

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