Opportunity and Inclusion
Financial inclusion
Definition
Access to and use of financial products and services (e.g., savings, credit), including mobile banking
*For more on digital inclusion, see the digital inclusion page
© Bill & Melinda Gates Foundation | Barbara Kinney | Rural mobile banking unit in Nkhoma, Malawi
How financial inclusion supports women's economic empowerment
Access to income and assets
Women-owned businesses experience higher levels of investment and profit when attached to financial inclusion programs
Does the classic microfinance model discourage entrepreneurship among the poor?
In Kolkata, India, a microcredit program with a 2-month grace payback period made women twice as likely to start a business and increased profits by 41 percent and incomes by 20 percent.
Field et al. | 2013
Savings constraints and microenterprise development: Evidence from a field experiment in Kenya
In Kenya, a program to reduce the cost of opening a bank account for women market vendors resulted in a 38–56 percent increase in women’s business investments and a 37 percent increase in their daily household expenditures.
Dupas and Robinson | 2013
Women are more likely to shift into more productive, income-generating forms of work when they have access to mobile banking services
The long-run poverty and gender impacts of mobile money
In Kenya, 185,000 women (roughly 1 percent of total Kenyan female population) switched into business or retail as their main occupation as a result of the M-PESA program.
Suri and Jack | 2016
Control of and benefit from economic gains
Women-run farms see higher agricultural outputs when attached to savings accounts
Commitment to save: A field experiment in rural Malawi
In Malawi, the opening of both commitment and ordinary savings accounts resulted in a 17 percent increase in agricultural inputs and a 20 percent increase in agricultural outputs.
Brune et al. | 2013
Access to mobile banking services are associated with moving out of poverty
The long-run poverty and gender impacts of mobile money
Mobile banking in Kenya reduced rates of extreme poverty (less than $1 per day) and of poverty (less than $2 per day) among female-headed households by 8.5-9 percentage points.
Suri and Jack | 2016
Power to make decisions
Opening savings accounts can increase women’s bargaining power within the household
Female empowerment: impact of a commitment savings product in the Philippines
In the Philippines, the opening of goal-based commitment accounts resulted in a 0.14 standard deviation increase on an index of decision-making power among married women. Among women with below-median decision-making power, opening an account led to increased expenditure on female-oriented durable consumer goods.
Ashraf et al. | 2010
Payment mechanisms and anti-poverty programs: Evidence from a mobile money cash transfer experiment in Niger
In Niger, greater privacy and control over digital cash transfers (as opposed to manual transfers) shifted household decision-making power toward women; 52 percent were solely responsible for spending at least some of the transfer and 99 percent of women were consulted on how the transfer should be spent.
Aker et al. | 2015
How financial inclusion produces further benefit
Education
Households with access to a savings account are more likely to spend more on children’s education
Banking the poor via savings accounts: Evidence from a field experiment
In Nepal, giving no-fee local bank accounts to female head of households increased educational expenditures by 20 percent annually. The spending was primarily concentrated on textbooks, school uniforms and school fees.
Prina | 2013
Preventative healthcare
The opening of savings accounts by women results in greater spending on preventative healthcare for the household
Savings constraints and microenterprise development: Evidence from a field experiment in Kenya
A study in Kenya found that opening commitment healthcare savings accounts resulted in a 70–130 percent increase in preventative health investments. Moreover, there was a 12 percentage point reduction (from 31 percent to 19 percent) in the likelihood of being unable to afford medical treatment once an account was opened.
Dupas and Robinson | 2013
Banking the poor via savings accounts: Evidence from a field experiment
In Nepal, female heads of household who opened savings accounts saw a smaller reduction in weekly income when hit by a health shock when compared to households without accounts. The study primarily attributed this effect to increased preventative health spending.
Prina | 2013
Child health and nutrition
Households in which women open savings accounts tend to spend more money on nutritious food for children
Payment mechanisms and anti-poverty programs: Evidence from a mobile money cash transfer experiment in Niger
In Niger, household and child diet diversity was 9–16 percent higher among households who received mobile transfers and children ate one-third more of a meal per day.
Aker et al. | 2015
Banking the poor via savings accounts: Evidence from a field experiment
In Nepal, female heads of household who opened savings accounts spent 15 percent more on fish and meat, thereby providing a more nutritious diet for their children.
Prina | 2013
Women’s empowerment and economic development
In South Africa, girls in households where their grandmother received a pension had significantly better nutritional outcomes.
Duflo | 2012
Intra-household resource allocation: An inferential approach
In Brazil, income or assets in the hands of women was associated with larger improvements in child health and a larger proportion of spending on household nutrition, health, and housing.
Thomas | 1990
Interventions
While innovations to advance women’s financial inclusion have taken many forms, technological innovations -- including digitized social payments from governments, mobile money, and innovations in the design and delivery of financial products and services -- appear to hold particular promise.
Savings lockboxes in Kenya
Commitment savings accounts in the Philippines
Mobile money in Kenya
Guaranteed wage work in India
No-cost bank accounts in Nepal
Mobile cash transfer in Niger
Is there a case for action?
Although women and men throughout the world have been gaining access to financial services over time, in developing countries the gender gap hovers near 9 percent.
Most developing economies have a gender gap in account ownership rates, though the size of this gap varies from one country to the next. In Bangladesh, Pakistan, and Turkey, the gender gap is nearly 30 percent. Other developing economies with a double-digit gender gap include Morocco, Mozambique, Peru, Rwanda, and Zambia.
The persistent gender gap in financial inclusion reveals the need for action, especially given growing evidence of financial inclusion’s ability to boost WEE, spark growth in microenterprises and small enterprises, reduce the exposure of poor and rural communities to income shocks, and promote more sustainable and equitable development.
While efforts to advance women’s financial inclusion have taken many forms, technological innovations—including digitized social payments from governments, mobile money, and innovations in the design and delivery of financial products and services—appear to hold particular promise.
© Bill & Melinda Gates Foundation | Prashant Panjiar | Tokens for migrant workers in Bihar, India | 2010