5 Reasons Why More Women Need Access to Financial Services

More than 50 percent of the 2 billion people who don’t have access to basic financial services are women.

Despite having multiple roles in society– as consumers, business owners and employees, mothers and caretakers – there is a large gap of economic equality between men and women. In fact, a woman’s chances of receiving credit are markedly lower than a man’s.

A recent report by the Omidyar Network and Bankable Frontier Associates examined the social, economic and cultural reasons of why women in emerging economies have difficulty in achieving financial inclusion.

• Women tend to have lower incomes. The report found that “income is a major driver of financial services use. Those with higher incomes are more likely to use formal financial services.” Without a substantial, regular income, many women see no need in maintaining an account with a financial institution.

• Women earn money differently. Women in many emerging economies are less likely to earn money from full-time jobs. Instead, they rely on irregular incomes from the informal sector, self-employment or from remittances from relatives.

• Women face more life interruptions than men. Family responsibilities take precedence for women. Familial interruptions to daily life – such as caring for aging parents, childbearing, organizing funerals and weddings – impact a woman’s ability to maintain a career, earn consistent income and grow her savings.

• Women have different priorities for the household. Women place more emphasis on building a secure, permanent home. Men focus on longer-term goals in building their businesses or investing in land. When men do not meet financial obligations, however, women have to stretch their small budgets to cover basic expenses or emergencies.

• Women stay close to home. Men tend to spend a majority of their time around economic centers whereas women tend to spend their time at home or near home. Spending behavior is also community-related for women whereas men are more willing to travel to purchase goods. This means that women are less likely to come in contact with financial services providers if none exists in their communities.