Financial exclusion rates are generally higher for women than for men. in Zambia, for example, 68.4 per cent of women are financially excluded compared with 64.4 per cent of men, according to Finscope, a survey of financial inclusion conducted by the FinMark trust. Efforts to improve financial inclusion, for example through the provision of microfinance, have often been targeted at women. The fact that one of the world’s leading microfinance institutions is called Women’s World Banking is symbolic of the role that gender plays in financial exclusion – it is estimated that women make up some 80 per cent of the world’s microfinance clientele.
In many countries, the financial exclusion of women has been enshrined in law. regulations such as those that bar a woman from opening a bank account without her husband’s permission were once commonplace. “In the mid- 1980s, we saw a lot of countries, particularly those colonised by the French, moving away from Napoleonic law under which women were considered in the same categories as minorities and the mentally distressed,” explains Jacqueline Novogratz, founder and chief executive of acumen Fund, a new York-based non-profit venture fund that uses entrepreneurial approaches to tackle global poverty. “That has changed from a structural perspective quite radically throughout the world.” today, many of these regulations have been altered, but this historical precedent has left a legacy of gender-skewed exclusion.
Even more problematically, some restrictions persist. In some African countries, women have no formal property rights and are barred from having land titles. This gives them no collateral with which to secure a bank loan; if their husband signs for the loan on their behalf, their autonomy may be curtailed. Moreover, many cultural and family restrictions remain in place. In Malawi, for example, a wife whose husband dies has to surrender her possessions – including all financial assets – to his family.
“It’s a tangle of issues when you talk about women’s economic empowerment,” says the WWB’s Ms Iskenderian. “For example, savings are quite often a positive force in women’s lives. However, it’s not just about the finances or economics – there’s a whole set of other things.” To illustrate this point, she cites the example of women who take out micro-loans with a compulsory savings component attached to the account. This can create problems for women when their husbands get wind of the savings. “He would force, often with physical violence, the women to withdraw the savings and pay down the balance rather than continuing to save,” she says.
In some countries, it remains difficult or culturally unacceptable for a woman to work, let alone to take out a loan and start a business. “In some cultures, women aren’t expected to leave the household,” says Ms Novogratz. “So you might have perfect regulation at the financial institution level, but need a different way of accessing those women who aren’t able to walk through the streets.”
