IFC experience – Women present an untapped Business Opportunity
Access to financial services in the Pacific is poor to start …. Adult % # of ATMs # of POS Mobile-cellular COUNTRY Population Banked per 1000 per 1000 subscriptions per (millions)1 (Adults)1 Adults2 Adults2 100 inhabitants3 Fiji 0.5 39% 0.31 8.33 81.1 Vanuatu 0.2 25 0.1 0.3 119.0 PNG 3.6 8% 0.22* 1.5* 27.8 Samoa 0.1 19% 0.19 3.16 91.4 Solomon Islands 0.3 15% 0.1 0.3 5.6 Tonga 0.1 40 0.24 2.05 52.2 Timor Leste 0.6 13% 0.01 0.73 53.4 United Kingdom 49 91% 1.3 23.9 130.81. Financial Access Initiative, "Half the World Unbanked", October 20092. World Bank Group, "Payment Systems Worldwide - Outcomes of the Global Payment Systems Survey 2010"3. International Telecommunication Union, ICT Indicators database, November 2011* Estimates
Microfinance is challenging for providersProduct FI view point Customer viewMicro loans: Specialised lending – not Limited commercial opportunities- <$10,000 mainstream banking. that generate regular income to- Commercial Limited collateral pay interest.purpose Small value loans / low Alternate sources of money volume > high rates to cover costsMicro deposits High system liquidity in - Cash is the low cost option Islands – limited government - expenses exceed income so borrowing and lending saving is difficult opportunities to invest – no - access to financial services is so desire for small expensive low that cash is easiest deposits – no need to pay interest to customers
An Overview of Gender Issues in the Pacific regionIsland economies have long been challenged by geography, labor skills and tiny economies-of-scale, which contributed to isolate women and men, especially in rural areas, and thus to maintain strong traditional gender rolesW works for one country might not be relevant for hat another, given very different contexts, vulnerabilities and capacities
An Overview of Gender Issues in the Pacific regionSome of the most pressing human rights in the region such as: widespread poverty, violence against women and children, lack of judicial independence, weak governance are challenges to gender achievementsPICs Governments (except Tonga) adopted the convention to end the discrimination against women (CEDAW), yet action is slow to materialize. Millennium Development Goals (MDG) have provided a “call for action”: Goal 3 calls for promoting gender equality and empowering women, PICs are slow to comply…
An Overview of Gender Issues in the Pacific regionCultural attitudes and normative discrimination restrict women’s full participation in economic activities: Traditional gender roles persist throughout the region; differences among Melanesia, Micronesia, Polynesia Ka s to m , a d e fining c ha ra c te ris tic o f the M la ne s ia n e c ulture a nd g e nd e r Wa nto k could be equated to a traditional safety net can have adverse effects, is fundamental to the Melanesian culture Women receive less business training and development than men and workplace policies are not women friendly
An Overview of Gender Issues in the Pacific region On paper laws are generally the same for men &women but in practice they are not implemented in a gender equal manner Discriminatory provisions against women in the legal framework governing property rightsSex disaggregated statistics are needed to: Monitor gender gaps and their change over time Lobby and advocate for gender equality showing the extent of existing discrimination Inform to which extent business regulations affect women relative to men, especially re. time and social networks
An Overview of Gender Issues in the Pacific regionWomen have reduced access to: Resources, including - land – issues with ownership & inheritance - movable assets Capital: financial, human, social, time Formal Business Registration Decision Making Security – physical: widespread violence against women This hinders women’s ability to engage in economic activities, as employees and/ as successful business or owners
Fewer women are employed as compared to menWomen are discriminated against: Horizontal segregation: women are employed in only a few economic sectors: services, sales and “elementary occupations” Vertical segregation: “the glass ceiling”: women have less access to decision-making Pay gap: women are paid smaller salaries than men
Employment data in selected PIC’sTimor Leste 30% of women of working age are employed, mostly in rural areas 45% of women work on their ownPapua New Guinea 73% of women>15 economically activeFiji 38% of women are employed rural/urban 40% of working women self-employedSamoa 20% of women >15 employed 75% rural 43% of women receive income/remittances
Examples from the Pacific region: W omen as a Business OpportunityWomen are important economic actors in the Pacific region as producers and sellers of goods and servicesWomen business entrepreneurs have a good track record as savings and credit clientsWomen are better development agents than menAcross the region women tend to manage the household finances more than menWomen are highly interested in insurance products andAre more frequent remitters
Women are less “banked” than men 30% of rural women have bank accounts vs. 45% of men (PFIP, Fiji 2009) Same disparity for savings, loans, investments Women understand & manage household finances better than men Household Financial Management and Gender Men WomenKeep Financial Records 18% 63%Checks bills & accounts 45% 66%are correctHave a household budget 37% 57%
Fewer women are employed as compared to men« The wellbeing of a rural household can be quantifiably improved if oneperson in that household attends financial literacy training and has asavings account. A significantly higher level of wellbeing is achievedwhen that person is a woman ». Conclusion from Financial Capability, Financial Competence and Wellbeing in Rural Fijian Households, PFIP Note No 1, December 2009
Women participate less at financial training than men Reasons for not participating at financial literacy training workshop Men WomenWas not in the village when training 60% 33%was heldHad other work or family 25% 20%commitmentsW not aware of training or was as 10% 35%not askedWas not interested in attending 5% 9%
FI’s Have Successfully Invested in Women and Gender-diverse Policies Standard Chartered - embarked on a company-wide coordinated approach to step up gender diversity in 2005. Now, 22% of senior managers and 33% of middle managers are women. Several of its country offices are headed by women CEOs Bancosol, Bolivia – introduced a full-coverage maternity insurance product. Women are over 60% of microinsurance clients & 45% of borrowers Kashf Foundation, Pakistan – offers credit exclusively to women and It supports women empowerment at client and staff level for which it has set gender diversity targets closely monitored by its president Banco ADOPEM, Dominican Republic – originally a MFI, 89000 active borrowers and savers, 77% women, 52% rural clients. In addition it provides insurance products and remmitances. A member of Women’s World Banking it also promotes women empowerment at institution level
The business case for investing in women and promoting stronger gender diversity within FIsFI’s can grow their customer base by targeting women clientsWomen clients make for a better bottom linePromoting gender diversity makes for a more productive, innovative workforceFI’s can improve their image by investing in women
Examples of Financial Institutions in the Pacific Region that have successfully targeted women MFIs (see case studies): - Moris Rasik and Tuba Rai Metin in Timor Leste - SPBD in Samoa, Fiji and Tonga; Vanwoods Microfinance Inc, Vanuatu - PML and Nationwide Microbank in PNG Local commercial and national banks: - National Development Bank of PNG - National Bank of Vanuatu International commercial banks - Westpac in Fiji, Tonga Insurance companies: - Life Insurance Corporation of India (LICI), Fiji and several MFIs (ex: Timor Leste)
PNG offers substantial opportunities to FI’s to increase their female customer base… & staffA bank that has taken the lead in targeting women clients: PNG NDB – introduced women’s desks in 2010,: appointed women representatives at all branches to service. No of women borrowers went from 27 & USD 0.3 M in 2010 to over100 & USD 4.3 M in 2011. A call center accepts loan applications from women entrepreneurs. Women are calling from across the country. In March 2012 PNG NDB hosted a Women in Business Summit where a new website for women in business & a textile credit scheme for women was launched. Challenges seem commensurate with PNGs economic opportunities (LNG included), large population, sizable numbers of women potential clients
Conclusion: There are opportunities for gender finance that make business sense … new products, new channels of distributionMobile banking can channel to women – including in remote rural areas – credit, savings, remittances and insurance products Yes, challenges exist but are worth taking given the opportunities that are in sight!
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