BRUSSELS – What do breastfeeding and bank accounts have in common? A lot, if you ask Greta Bull. The CEO of the Consultative Group to Assist the Poor (CGAP) was working with a microfinance institution in India when she noticed the relationship.
“We looked at their branch: Almost all of their customers were women, and they had to sit for hours in a waiting room. There were no facilities for children, there were no privacy facilities for breastfeeding,” she says. “There was nothing that supported their clients.”
Bull points to this as a prime example of how social norms can make it more difficult for women to open and maintain bank accounts than men, and why providers have to work hard to overturn those norms. It’s not just the products an institution provides to women that are important, she says, but how you provide them.
CGAP is a partnership between 30 organizations dedicated to closing the global financial inclusion gap. A big part of that will involve signing up more women for financial services. The World Bank’s last survey of bank account ownership worldwide found that the gender gap had not closed in seven years, and that it was getting wider in many countries.
We sat down with Bull to discuss closing the financial inclusion gender gap, why women are more vulnerable to data leaks and what the true purpose of financial inclusion programs should be.
Women’s Advancement Deeply: The latest edition of the Global Findex showed that the gender gap in account ownership has not closed. Is it just easier to sign up men for bank accounts than for women?
“I said, ‘What would it take to close the gender gap in Pakistan?’ His basic response was, ‘Why would I care?’ We have to think of ourselves as a means to an end, as facilitating something else happening, rather than having a bank account as a declaration of a victory.”
Greta Bull: I think it comes down to what you prioritize. I once put a question to a leading provider of digital financial services in Pakistan. I said, “What would it take to close the gender gap in Pakistan?” His basic response was, “Why would I care? I have so many men who are unserved, I can serve them much more easily.”
If you look at the Findex data, Bangladesh went, I think, from 35 to 50 [percent of the population with bank accounts]. They would have hit 65 if they had prioritized women at the same rate that they prioritize men. It’s just that they didn’t. And so, in a lot of countries this actually dragged down the average.
It comes down to policy prioritization and business prioritization, and if that’s not there it’s really hard to make it work. Some markets did some really interesting things, like India and Iran. Nobody talks about it, but look at Iran’s data. They hit developed world levels of financial inclusion and closed their gender gap. It went from 23 percent to 7 percent. And so I think with really clear policy focus, leveraging state-owned bank accounts in a lot of those cases, you can successfully close the gender gap.
Women’s Advancement Deeply: What are some technological shifts that you think are going to happen in the next five to 10 years that might help in terms of financial inclusion?
Bull: Data is a huge one. Increasing use of data by financial service providers means that you can be a lot cleverer about targeting people. [Using] mobile combined with data, you can put together profiles of your customers that allow you to serve them more smartly in terms of providing them with things they want but also managing your risk against lending to that person.
I think we’ll also see shifts in how financial services are delivered. For example, we’ve seen this big movement in Africa towards mobile money. Well mobile money is a technology play but it’s mostly also still a cash distribution play. So if there are women agents, that tends to be empowering for women and they are more comfortable going to the agents. As we start flipping that into more digital [accounts] rather than person to person [lending], that could have a discouraging effect for women but it could also make it easier.
Another thing is e-commerce. Women can run their own businesses from home and sell over e-commerce platforms. Platforms [like Amazon and Alibaba] are very empowering and [your customer] doesn’t necessarily even know you’re a woman if you are selling on those. As long as you have the account and have access to that platform then you can do a lot.
Women’s Advancement Deeply: You mentioned the importance of data, what kind of data is needed to reach more women?
Bull: All kinds of data is useful, and that’s also the risk. So consumer data, how you’re using your wallet, how you’re using your money, so that you can be profiled by companies that are trying to sell things to people. But in financial services it helps a lot to understand what somebody’s spend patterns are so you can think about extending a loan to them. It makes the risk management aspect of that a lot easier.
But privacy is a really big issue and a really big concern, particularly for women, particularly in certain parts of the world. So people don’t want their data exposed because they think it’ll be misused. And a lot of people are giving away data right now without actually knowing what it’s being used for and by whom and it’s being packaged and sold to third parties. So I think there are really interesting aspects of data that are going to be a challenge for us, particularly with respect to women.
Women’s Advancement Deeply: How are women affected differently by data breaches?
Bull: I don’t think they’re more vulnerable to data breaches, but the blowback of the data breach could be more serious. We did some work in India about the importance of privacy for lower income people. You know there’s this assumption that if you put people on the map they’re somehow going to be grateful to you and they’ll just take the services and give their data away because, hey, we all give our data away every day.
But there was actually quite a lot of sensitivity to having their data used and there was a lot of discomfort in it being misused. And given that in some markets women actually face physical threats for sticking their necks out too much. I think it is really a concern. It’s not the use of data or the gathering of data that’s different for men or women, but the impact can be a lot more severe for women.
Women’s Advancement Deeply: How do you build trust in a situation like that? How do we protect women from these quite credible threats?
Bull: That’s the big question of the day. Because we’re generating more and more data all the time, and it’s being used in ways we don’t even know.
I think there’s a lot that we can do around putting responsibility for the use of data in the hands of providers, a lot more we can do about transparent and clear consent on how the data is being used, a lot more we can do on how long providers can hold on to that data, and to what extent they can sell it.
In India, you see right now a lot of movement on payment systems where Google, Facebook are coming in to provide payments on the Unified Payments Interface in India. Those companies aren’t making money from charging you for making payments. They’re making money on monetizing your data. Does anybody know that? Are we getting the proper disclosure ahead of time? Probably not.
So I think there’s a lot more that needs to be done. The Indian Supreme Court has now pronounced that data is a human right in India. It still remains to be seen what India’s going to do with that. But I think they do have an opportunity to really leapfrog some of the ways that we’ve been doing it in the U.S. and in Europe and try to put a little bit more protection in place for consumers.
Women’s Advancement Deeply: There is some criticism of the financial inclusion agenda that says it’s the financialization of poverty and a shift towards turning people into customers rather than giving them aid or development assistance. What do you say to that type of criticism, and is there a place for it in our understanding of how to do financial inclusion work?
Bull: I think there are a couple of aspects to that. One, I think financial inclusion and financial services can be empowering. If you take the case of the off-grid industry. With off-grid solar chargers that also have agricultural applications, you’re putting demand side power in the hands of people because they can get credit to buy those and make tiny payments and that becomes a viable business proposition. To me that’s an incredibly empowering use of a financial service.
Is it the be all end all? No. People don’t wake up going, “I really wish I had insurance today,” or “I really wish I had a loan.” It’s for a purpose and in the financial inclusion industry we have to be humble about what that purpose is. People want to educate their kids, they want to pay for improvements to their house. They want to buy a charger so they have electricity into the night so their kids can study. We have to think of ourselves as a means to an end, as facilitating something else happening, rather than having a bank account as a declaration of a victory. It should be supporting the sustainable development goals. I think that’s what we’re really working towards as an industry.
This conversation has been edited for length and clarity.