Financial Inclusion

The Unbanked ‘CFO’

There are 2.5 billion in the world without a bank account. That number is familiar and been reported widely. What’s lesser known is that a majority of those 2.5 billion unbanked people are women.

And that presents a problem not only for the women who, themselves, are unbanked, but for their families and the economies of the towns and villages they inhabit.

“Women tend to be the CFOs in the household in the emerging markets around the world,” Douglas Sabo, Visa’s Head of Global Corporate Philanthropy, noted at an International Women’s Day Conference last week in D.C. “They are the ones who have to figure out how to make the daily financial transactions work — when money is coming in from a microloan, a government subsidy, when money needs to go out to put food on the table, to pay for school fees, to fix a roof,” Sabo added. “So they are bearing the brunt of the cost of a household being unbanked.”

Visa has partnered with companies in Ghana, Nigeria, Uganda, Southeast Asia and Latin America to try to change that. It includes a number of things designed to deliver credit and banking technologies to women in these regions, including access to mobile phones, which are an important part of that financial lifeline. In these emerging economies, more men than women are likely to own a phone.

As promising as this initiative is, and as more private and public partnerships flourish, more women are being reached. But, still, gaps exist — both in urban and rural areas.

The Mobile Money Gap: Where Are The Unbanked And Why Are Most Women?

GSMA reported that many studies on the subject of mobile money show that most don’t know what type or region (rural/urban) their customers live in, or if they are men or women. This appears to be a gap for women, as it suggests that some mobile money carriers are still unaware of where the gaps are.

“To maximize its socio-economic impact, mobile money needs to sustainably reach people at the bottom of the economic pyramid. Unsurprisingly, most studies indicate that mobile money customers are urban, male users – the typical early adopters. This suggests mobile money follows a traditional technology life cycle and therefore, industry stakeholders should align expectations and strategies to the mass market adoption process,” GSMA reported.

But women may be being overlooked.

“Regardless of the level of maturity of their service, there are fundamental indicators which mobile money providers can use to improve their visibility of underserved segments, including the collection of demographic data to identify and track usage amongst women and rural customers. However, only 24 percent of survey respondents said they know what proportion of their customers reside in a ‘rural area’ and only 23 percent reported that they know the gender composition of their customer base,” the report added.

How The Mobile Money Gender Paradigm Is Shifting

With the rise in awareness about financial inclusion and the gaps in the global financial system, mobile money providers appear to be keen to where their services need to shift toward. It’s a slow shift, but a shift regardless. The gap is anticipated to lessen as more private and public partnerships form in developing and emerging nations.

“Interestingly, the (mobile money) providers who shared data on rural and gender both this year and last year (13 respondents) saw their penetration increase (8 respondents) or remain stable (5 respondents) among both segments. Registered rural users increased to an average of 48 percent of all users this year from 43 percent last year,” the report said.

And it continues to be on the rise for women.

“If we consider the average proportion of women in the customer base, it has also slightly increased globally to 38 percent from 36 percent last year. Much of this growth may be organic and due to the overall growth of the mobile money registered base, but MNOs who want to drive adoption in the mass market need to adapt their strategies and tactics specifically to tap into the potential of underserved segments,” the report continued.

Here are a few stats to underscore how widespread the issue is and who’s doing what to help.

15-20 | Percentage Of Population In Papua New Guinea, Africa, With Access To Financial Services

GSMA’s report on mobile money and financial inclusion highlights Papua New Guinea as a strong example of the impact of micro banking on a rural region. Fifteen to 20 percent may not sound like a lot, but it’s getting a boost from a high mobile phone penetration and services such as MiCash, which provides access to banking services via a mobile phone on the Digicel network. And women are a key beneficiary.

“With only 15-20 percent of the population having access to financial services, and a mobile penetration of about 70 percent of the population, mobile money represents a strong opportunity to increase financial inclusion in Papua New Guinea,” the GSMA reported. “MiCash was initially marketed as a savings product, and the uptake within a few months from launch was relatively high: in June 2012, 70 percent of MiCash customers were not previous customers of Nationwide. To date, women constitute 38 percent of the MiCash customer base and tend to use it primarily for savings purposes,” the report stated.

Specific points highlighted by GSMA that has helped increase number of women users in MiCash have been campaigns to raise awareness of how to become a mobile money customer.

“Specifically, enabling peer-to peer learning about how to use mobile money was crucial to Nationwide Microbank to increase the penetration of MiCash amongst women. For this purpose, Nationwide Microbanking has been taking women from south of the capital Port Moresby, who are more “active” when it comes to using MiCash, to the ‘impact’ villages north of the capital, where mobile money was not being used, to teach them about mobile money,” the report said.

50 | Percentage of Women In Western Europe That Are Unbanked or Under Banked

Financial inclusion doesn’t only apply to developing markets, MasterCard CEO Ajay Banga remarked at Mobile World Congress, citing that “nearly 70 million Americans are currently unbanked or under banked,” in the U.S. In Western Europe, the number is closer to 100 million, he said. Of those, 40 percent are young people, he said, and 50 percent are women.

“Think about not being able to send a small amount of money to your mother at a reasonable cost. Think about having the social benefits you just got in cash stolen as you make your way home. Or worse by relatives at home – which happens far more than you might think, especially to women,” he said. “Yet, 85 percent of the world’s retail transactions are still done in cash. …While we can’t talk about financial inclusion without talking about cash, we can’t talk about cash without the need to move beyond it – to move to electronic forms of payment.”

103 Million | The Number Of Active Mobile Money Accounts

While the mobile money market is growing, as more than 21 services now have more than 1 million active accounts, according to GSMA, there’s still a portion of women who are being left out. But evidence suggests the scale is slowly shifting.

“The industry is getting smarter about what it takes to prompt mobile money adoption,” the GSMA report states. “Operators are reaching more customers at the bottom of the pyramid. Survey respondents reported an overall increase in the penetration of mobile money services among women and among rural customers.”

So perhaps the shift is occurring? Maybe soon those “CFOs of the household” will have the power to tap into the financially-connected world.


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