Monday, January 25, 2016

Going to where the Women are: Insights from the Making Finance Work for Women Summit in Berlin, Germany

By Ursula Dalinghaus, IMTFI Postdoctoral Scholar

BMZ Berlin, Germany (Photo Ursula Dalinghaus)
On November 11th and 12th I attended the Making Finance Work Summit in Berlin, Germany, co-hosted by Women’s World Banking and the BMZ (Federal Ministry for Economic Development and Cooperation). At a time when Germany is responding to its own financial inclusion challenges with regard to integrating refugees from war-torn Syria, the agenda of closing the gap in formal financial inclusion globally could not be timelier.  

In his welcoming remarks, Thomas Silberhorn, Secretary for the Federal Ministry for Economic Development and Cooperation, began with an oft-cited quote in Germany by Fyodor Dostoyevsky, “Money is coined freedom,” noting that "access to this freedom, access to money is key” for addressing the summit topic of making finance work for women where global access to financial services is uneven and unequal between men and women.

Speakers across the panels emphasized the importance of getting to know women’s priorities as entrepreneurs and for their households. Research cited showed that women made 70% of household decisions and invested 90% of their income in the household. And yet as some speakers pointed out, the reason for the summit was the paradoxical statistical finding that women still remain largely underrepresented in, and excluded from, formal financial channels and services, from the boardrooms and decision-making entities of financial service providers, and from impact investments.

The story of women entrepreneurs who conduct business literally at the doorsteps of banks and yet do not have bank accounts was picked up by many at the summit as a powerful metaphor for showing the gap in formal financial inclusion as one not only of access but acknowledgement of a whole constellation of women’s concerns around access, empowerment, and autonomy.

"A BETA Way To Save Pilot"
A BETA Way To Save (Photo Women's World Banking) 
Several panelists also emphasized a need for financial products and services that target and reflect women’s priorities and needs, especially for saving and greater autonomy over household income. Diamond Bank and Women's World Banking's pilot study, “A BETA Way to Save,” stood out as a successful case of a commercial bank adapting to this market segment and their existing practices. Low-income self-employed women vendors in the Balogun market in Nigeria continued to rely on informal financial services for savings and short-term loans. But the problem was not only one of access; women experienced emotional distance too. The BETA Savings product moved the bank closer, physically and emotionally, to where women already are. By bringing the doorstop of the bank to the women, with regular visits by BETA agents to the market stalls, women vendors no longer faced the logistical problem of leaving the market stall to deposit savings in the bank and the time-consuming security measures this required.

In the session, How Can Technology Drive Financial Inclusion for Women, Anna Gincherman (Women's World Banking) explained how the BETA Savings pilot “developed a product that mimicked the informal sector.” BETA “replicated” the informal susu system found in Nigeria and West Africa. Adapting the informal financial practices of savings deposit schemes known as “susu,” or here “ajo" (“daily contribution scheme”), she noted that we can learn from the informal sector “in creating a better proposition by employing a sales force of ‘BETA friends’ collectors that go around every day opening accounts using mobile technologies, so it's solving that issue of mobility.” BETA (or “good”) saving accounts integrated the face-to-face interactions of agents (BETA Friends) with the opening and maintenance of accounts using mobile technologies and other financial tools.

Photo Diamond Bank
Accounts were easy to open and maintain, enabling interpersonal deposit and withdrawal transactions in addition to traditional and mobile-based channels (such as ATMs and mobile transfers). Women could check and observe how their accounts were updated in real time, building trust in the system. Women earned interest on their deposits and could enter lotteries for cash prizes and other rewards by keeping money in the system. The bank created its own platform rather than partnering with MNOs to create a multichannel hub that could provide a seamless user experience. Marketing of the project used simple everyday language rather than “bank” language and BETA agents had a variety of means available to educate clients about the product and technical use, supplemented by financial education, “BETA Talks.” BETA Friends agents were the key success factor. The technical aspects worked because human agents could explain, connect, and build trust with clients, supplementing technology with face-to-face interaction. From the provider perspective, the scale and incentives for local agents who interact with clients was an important part of the design, one that is hoped can be scaled up.

Key Takeaways
I was impressed with how the ‘BETA’ case study resonates with the findings of many IMTFI projects affirming how social relationships and new technologies work together. Eric Osei-Assibey’s related research in Ghana on Susu collectors and mobile money also showed the importance of face-to-face interaction as the basis for trust in savings and repayment strategies that could not be captured by the phone. Mobile phones and other new financial technologies reflect and remake women’s social relationships. New forms of inclusion empower women, such as making the household budget a subject of intra-household dialogue between men and women. Greater inclusion may also create new hierarchies and tensions in the household that women must negotiate anew. The importance of “the human factor” for how low income earners are adopting new technologies requires ongoing research as new products and services are designed.*

Another key takeaway for me from this panel on digital inclusion, then, is that programs like the BETA pilot which take into account these local practices may only be sustainable in the long term if they can be scaled up, and only if they can provide an affordable and reliable service for users while also making money for the bank. On the same panel, Liz Kellison (Bill & Melinda Gates Foundation) underscored that "the solution to inclusion is digital. Without it, it will not be possible to reach the necessary scale." Developing products with women’s needs in mind means they can be “accelerators” but this depends on "making sure we have the rails in place to offer digital financial services -- the rails, the rules, the regulations. As soon as we do that then we have to think about the players that could be using this ecosystem.” Kellison noted that conditional cash transfer and support programs like those in South Africa and India show how digital payments can scale up to connect governments and citizens.

This goes hand-in-hand with the rollout of identity and biometric programs that can ensure women’s ability to open and access their own accounts. Louise Holden (Master Card) reminded listeners at the summit of the startling statistic that women are not only financially but also legally excluded, with even more women without the legal identity (or in some cases eligibility to secure one) necessary for transactional banking. “Legal identity and digital identity are fundamentally linked. It’s fundamental.” Holden views Fintech as a solution and described the South African case where multiple welfare programs could be linked through technology available on and offline and provide “proof of life” identity checks necessary for pension payouts, as one example.

Worn-down fingerprints of Rickshaw pullers in Delhi 
illegible to biometric scanners (Photo Mani Nandhi/Liz Losh)
The importance of IDs for accessing formal financial services is crucial and one that IMTFI researchers have also been documenting. But like digital inclusion, the challenge is not only one of access. In India, where a national biometric ID program  (AADHAAR) continues to be rolled out, programs seeking to formally include every citizen must take into account how biometric cards pose important questions about “stable identities” or how some forms of labor erase the physical signs by which unique identities are verified.

Greater digital financial inclusion also raises new questions about data protection as a public good. In the Q&A one participant asked how end users might monitor how their data is used. Louise Holden noted that data integrity is reputation; “data allows the network to be secured.” Tom Delucca (AMP Credit Technologies) added that paradoxically, the greater a “data subject’s ability to pick and choose what data is used, the less reliable for us who wish to use it for purposes which are beneficial to you as the data subject.” Paying attention to women clients’ needs and preferences, as well as to the gendered and social relations of which financial technologies are a part, is important to answering these questions, improving design and adoption, but also observing how women are negotiating these new credit and data relations.

The importance of collaboration, partnerships, and shared incentives between commercial providers, states, and regulators was an important theme throughout the summit. Low-income women, the target segment for these entities, should be seen as a partner. In an earlier panel on targeting women as a new growth segment, Debra Mallowah (Unilever Africa) picked up the thread about “who owns the customer?” saying, “Don’t tell her you own her. You need to get in a relationship. Create the love. Understand her influence and power.”

The Making Finance Work for Women Summit generated a productive forum for fostering dialogue around client-centric design and how it is working on the ground, from different provider perspectives. I was encouraged by how the partnerships showcased across the panels, as well as the careful research being done on the ground by product developers, service providers, and analysts from a variety of institutions, are placing target communities front and center. Going to where the women are means empowering while taking seriously locally specific needs and practices in the collaborative endeavor to close the financial inclusion gap.


*p. 11, Osei-Assibey, Eric (2014) What Drives Behavioral Intention of Mobile Money Adoption? The Case of Ancient Susu Saving Operations in Ghana. IMTFI Working Paper

For Women’s World Banking blog posts on the summit panels, see the Women's World Banking Blog and to view panel videos from the summit, see Quick Cuts from the Making Finance Work for Women Summit 2015 

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