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Women's Road to Independence? Mobile Financial Services

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The annual Mobile World Congress recently took place in Barcelona and one of the hottest topics discussed among mobile operators, governments and payment providers was mobile financial services.

MasterCard has just launched MasterPass, a mobile payment system and Visa launched its own service called V.me last year. This is good news in a globally underserved market where approximately 2.5 billion people are unable to access financial services. Within the emerging markets, countries in Africa are leading in the adoption of mobile payment services with products such as Tigo Pesa in Tanzania, MobileMoney in Nigeria, Airtel Money in Uganda, Zaad Telesom in Somalia and many more beyond just the obvious M-Pesa in Kenya dotting the African landscape.

Women in most parts of the world struggle particularly to obtain a loan, access suitable savings products or even to simply open a bank account. Accessing capital is the challenge that continues to come up as a top priority across many of the programmes supporting women entrepreneurs. Statistically women have lower financial literacy rates than men. Interest rates on loans can be higher for women and financial institutions are often reluctant to give out loans to women, unless they have a male partner and high-value collateral. When women do receive loans, they tend to be at lower values.

GSMA (the global association of mobile operators) and Visa jointly released a report at the Mobile World Congress, Unlocking the Potential: Women and Mobile Financial Services in Emerging Markets. In it they outline the opportunities the mobile phone brings for women who find it difficult to access financial services in developing and emerging economies and who are yet to be fully included in mobile retail channels.

A few obstacles need to be overcome though before promoting mobile money as a remedy for the financial access gender gap. The report states that 34% of women in Tanzania, 13% of women in Kenya and 10% of women in in Papua New Guinea who say they want to try mobile financial services cite the lack of a phone as the main reason for not having done so. Prior research by GSMA and the Cherie Blair Foundation for Women indicates that the lack of perceived value is another barrier to women's use of mobile.

If these obstacles are addressed, a mobile phone in the hands of a woman can be a vital tool for access to finance and to a wider customer network. Lilian Adhiambo for example used to sell second hand clothes on the shore of Lake Victoria in Kenya. She was one of 5,000 women entrepreneurs who took part in CARE International UK and the Cherie Blair Foundation for Women's Nyanza Women's Economic Empowerment initiative in Kenya.

Lilian attended several trainings and was introduced to mobile money through the project and as a result, expanded her business to three units in different locations. She uses her mobile phone for financial transactions and to communicate with her employees.

In a nutshell, with the right business training and equipped with a mobile phone as well as financing options, women can become financially independent and feel much safer. Mobile technology can be a vehicle for savings, insurance, payments and a way to obtain credit, but it is on its own not enough. Efforts need to span from improving the regulatory environment to better educating clients on their financial rights and enabling them to fully understand the choices available.

Clearly, there is a need for better policies and practice within the private and public sector to support women in a sustainable way to access capital and financial training. It is a complex task to design adequate programmes of scale across sectors that aim at ensuring women's financial inclusion in unbanked or under-banked markets but some organisations are making headway. DFID together with GIZ, on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), recently published a helpful toolkit: Promoting Women's Financial Inclusion. The toolkit offers a model to developing financial services that will enhance women's financial inclusion and enable economic empowerment of women.

A lot more is happening around fostering financial inclusion such as CARE's Banking on Change initiative, which aims to improve the quality of life for poor people by extending and developing access to basic financial services through savings led microfinance and the Financial Inclusion 2020 campaign which aims to mobilise stakeholders worldwide to achieve full financial inclusion by the year 2020 to just name a few.

The time is right to create a global movement around this issue and ensure it remains visible as an integral component for the post-2015 agenda. Women's financial inclusion and economic participation is a powerful yet underutilised weapon against poverty. Mobile financial services can help us make faster progress in achieving financial inclusion so that ultimately 2.5 billion can fully participate in economies around the world.

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