Financial institutions and the financial sector will have to do more than celebrating Women’s Day; they’ve got a huge responsibility that they have been ignoring for too long, which is also why some blame goes to them for women being disproportionately underserved by the country’s financial system. Financial inclusion of women has much broader benefit to the country in terms of women’s financial independence and contribution to broader economic development, while banks can play their part in harnessing the unbanked opportunity to their benefit.

Efforts have been made from time to time to promote women’s financial inclusion, but the needle hasn’t moved. A gaping gender divide continues to be one of the widest amongst its South Asian peers. Women’s formal account ownership as of 2017 stood at only 7 percent in Pakistan, which means that almost 93 percent of adult women in Pakistan do not have a formal financial account.

In recent years, SBP has been actively working towards women’s financial inclusion; its National Financial Inclusion Strategy (NFIS) envisions at least 25 percent adult females to have formal financial account by 2020 while the government targeting to reach 20 million active women owned digital transaction accounts, by 2023. However, a targeted policy was much needed to strategize how female onboarding the financial system would take place, and SBPs recent draft “Banking on Equality Policy” has received quite a credence as a starting point and framework towards better financial inclusion of women. The central bank has also set up webinars to discuss the policy.

It is important to understand that the gender-neutral view hasn’t been working, and a gender sensitive and a gender-targeted approach must be adopted to address the widening schism of financial inclusion. The draft policy focuses to engender equality in banking and reduce the gender gap in financial inclusion and has identified five pillars. First is improving institutional diversity, which essentially means addressing financial institution’s internal gender imbalance. For that they will be asked to develop policies to ensure minimum 20 percent female participation in the workforce by 2023. Second, product diversification and development capability to shift from gender neutral to gender inclusive and gender-segmented product design. Third, women champions at all customer touch points particularly for the facilitation of intimidated women customers and entrepreneurs. Fourth is collection of gender disaggregated data to be reported to SBP as well as to be used by the financial institutions internally; And fifth, prioritizing gender focus in SBP’s policies.

There were some key regional insights and takeaways for financial institutions from a recent consultative round held by the World Bank on SBP’s gender financial inclusion policy. Success stories from the developing world incorporated gender sensitivity trainings at the very basic level – for example gender sensitivity training at branch level at banks had a dramatic impact.

Another one is the availability as well as the practical use of gender disaggregated data, which is not just the demand side data but also supply-side data such as alliance with development banks to help financial institutions collect gender disaggregated data on their products, services, and respective responses.

Also, anecdotal evidence suggests that women are better agents; women customers are more loyal; and they are better at paying and better at creating linkages and cross selling, which should give the financial institutions innovative ideas to bring them into the formal financial system.

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