Reflections from the 2024 FinEquity Africa Annual Convening

“If you want to go fast, go alone. If you want to go far, go together.”  This African proverb was recounted several times at the FinEquity Africa Annual Convening in Addis Ababa, Ethiopia this March. Indeed, the sentiment was that we can go far in advancing women’s economic empowerment and financial inclusion (WEE-FI) – but only if financial service providers, the public sector, civil society organizations, and development partners continue to work together—and with—women to develop financial products and services that meet their needs.

Our ability to go far stems, in part, from a plethora of recent WEE-FI research and decades of lessons learned from those in the FinEquity Africa community and beyond. In Addis, I had the pleasure of sharing GRID Impact's research on barriers and opportunities to WEE-FI. Since 2021, GRID has been working with the Inclusive Financial Systems team at the Bill and Melinda Gates Foundation to examine barriers inhibiting women’s access to and usage of financial services. Born out of a desire to promote evidence-based decision-making and get specific, our research identifies barriers that are most relevant to specific types of women in specific markets and makes recommendations about the kinds of interventions that can address them. While many barriers contribute to inequitable financial systems, our methodology offers an approach for prioritizing interventions in different contexts.

_{^{Figure 1. We examine thirty-five barriers falling in eight categories.}}

Specifically, we examine a set of thirty-five barriers falling into eight categories. Findex allows us to categorize women into segments reflecting their level of financial inclusion, and to make comparisons across markets over time:

• Segment 1: Excluded, marginalized
• Segment 2: Excluded, high potential
• Segment 3: Included, underserved
• Segment 4: Included, not underserved

^{_{Figure 2. No barrier operates independently of other barriers. Here, larger nodes identify more connections, and possibly, opportunities for outsized impact.}}

What does our research suggest about WEE-FI barriers in East Africa?

1. Women who own financial accounts but remain underserved by the financial sector, Segment 3, is the most represented segment among women in Ethiopia, Kenya, Tanzania, and Uganda. The relative size of this segment within these countries, however, varies. 

^{_{Figure 3. Segment 3 is the most represented segment among women in East Africa, but the relative size of this segment varies across countries.}}

2. While mobile money has been around for more than 15 years in Kenya and Tanzania, Ethiopia’s mobile money market is still nascent. With over half of all mobile money accounts in Ethiopia opened in the last five years, however, more Ethiopians have a growing network of digital financial services (DFS) users.
3. Digital savings, person-to-person transfers, and utility payments are relatively high in Kenya, Tanzania, and Uganda, but digital payments remain low. In Ethiopia, both digital savings and payments remain low.
4. The cost of mobile data is relatively low in Ethiopia, Tanzania, and Nigeria, especially as compared to Tanzania and Kenya.
5. Education levels vary across countries. In Ethiopia, 74% of women in Segment 3 have primary levels of education or less, while in Uganda, Kenya, and Nigeria, more than half of the women in Segment 3 have secondary education.
6. Gendered social norms affect women in every segment in every market!

These insights help us determine which barriers are more relevant in a given market. Notably, across all markets in East Africa, is a lack of products that meet women’s needs—such as their limited mobility, lack of personal ID, and generally lower digital literacy. This limits both potential female customers’ incentive to open accounts and the diversity of products used by existing customers.

This barrier is closely related to a lack of products and services that create value. Transitioning from cash to digital requires perceived benefits to outweigh perceived costs (both financial and non-financial). Unclear or unavailable information about products/uses is also related, and a key barrier in Kenya, Tanzania, and Uganda. It may not be the lack of products that create value for women that is the key barrier, but rather unclear or unavailable information about them.

In relatively more advanced DFS markets like Kenya and Tanzania, are barriers related to cost and consumer protection. As DFS are used more frequently for more advanced transactions, women may be at a greater risk of fraud, scams, or overcharging.

Finally, without acknowledging and addressing the gendered social norms that influence how financial systems function, it will be difficult to make meaningful, transformative change.

^{_{Figure 4. Comparative barrier prioritization for Segment 3 in East Africa.}}

While there are many WEE-FI barriers, the good news is that there are also many opportunities for overcoming them. Our research examines forty-five interventions that have had positive outcomes on women, which we hope will inform evidence-based programs in new contexts. It was exciting to hear so many financial inclusion experts speak in Addis about opportunities that echoed these “exemplars.” Some recurring themes stood out:

• Embedded finance creates compelling use cases for women. While effective integration of financial services into non-financial offerings (e.g. ag-tech and e-commerce platforms) requires overcoming digital infrastructure and phone ownership barriers, women are attracted to products that make it easier for them to manage their lives and income.
• Digital literacy interventions have the potential for outsized impact. Digital literacy—the ability to interact with, use, and navigate digital platforms—is distinct from financial literacy, the understanding of financial products and ability to complete financial tasks. While both are important, digital literacy is one of the most-connected barriers and is relevant across all segments. Successful digital literacy interventions could improve trust and the perceived value of financial services, while also reducing issues related to account-opening, navigability, over-charging, and even phone/SIM ownership.
• Female agents are important to women’s financial inclusion. In many contexts, women are more likely to transact with female agents, which increases both with the value of transactions and the customer’s balance.
• Collaboration between policymakers, providers, and CSOs is essential for WEE-FI. In Addis, we heard from regulators about the role of gender-intentional policy and regulation; from providers who have successfully developed gender-intentional products; and from CSOs who are advocating for the needs of women they work with at the grassroots level.

If you’re interested in learning more about GRID Impact’s research or engaging with our tools and resources, take a look at our website or contact info@gridimpact.org.