Addressing The Gender Gap In Financial Inclusion

March 8, 2022

Addressing The Gender Gap In Financial Inclusion

“Women, in particular, often bear the brunt of poverty and limited access to economic opportunity, including unfavorable financial access. Inequality is not just a moral issue—it is a macroeconomic issue. Growth has to be more inclusive, and for this, finance has to be more inclusive…to close the gender and inequality gap.”

Christine Lagarde, Managing Director, International Monetary Fund (IMF)


Is There a Gender Gap in Financial Inclusion?

Financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit, and insurance- delivered in a responsible and sustainable way. (World Bank 2020)

According to the Global Findex 2018, there has been a persistent gender gap in access to the financial system, where 72% of men have an account while only 65% of women have an account: this gender gap has remained unchanged since 2011. In terms of usage, recent research shows that at a global level, men represent 65% of customers, they handle 80% of loan volume and 75% of deposits. (Global Banking Alliance for Women, 2018) This means that a ratio of 1 woman to 4 men can access loans and for every 7 women conducting transactions, 13 men are able to do the same (almost twice the number). As such, the issue of gender disparity is of great importance in the financial sector. Financial inclusion can act as a catalyst for increased equality, an enabler of countries’ development, economic growth, business evolution and social inclusion. Therefore, this article will address the macro and microeconomic benefits of closing the gender gap.


The Macroeconomic Argument for Investing to Address the Gender Gap

It is estimated that approximately 80% of women-owned businesses with credit needs in low-income countries are either unserved or underserved. Underserved women are those who experience significant lack in accessing services due to barriers that may exist whilst unserved women are those who have no access to services due to exclusion. This translates to a $1.7 trillion-dollar financing gap. Consequently, the global economy does not materialise an annual $330 billion dollars in turnover due to this financing gap. (International Finance Centre, 2020) Thus, it can be noted that when women are able to develop their full labor potential, there can be significant macroeconomic benefits for countries.

Firstly, access to finance increases access to productive assets which increases productivity, and this is linked to stronger economic growth. Having access to and use of a range of financial services enhances not only the contribution of women and women-led business to economic growth, but also contributes to women’s autonomy, allows for better use of their personal and household resources, and reduces the vulnerability of their households and businesses. Enhanced access to finance and training and improvement in the support networks which female entrepreneurs can access also help to raise the productivity of businesses owned and managed by women. Moreover, accessibility and usage of financial services are key levers for increased women’s participation in the economy. Better opportunities for women to earn and control income could contribute to broader economic development in emerging markets, such as higher levels of school enrolment for .

A study in Kenya shows that greater access to financial services reduced extreme poverty among women-headed households by 22% as it allowed 185 000 women to leave farming and develop business or retail activities. (World Bank, 2018)


The Microeconomic Argument for Investing to Address the Gender Gap

“There is a strong connection between women’s access to financial products and services and greater opportunity not only for that woman herself, her family and her community, but really for the nation as a whole. Women are far more likely than men to spend money they have under their discretion on the education of their children, the health care for their family and improving their housing. And those are the kinds of developmental changes that can really have long-term intergenerational impact.”

Mary Ellen Iskenderian President and CEO, Women’s World Banking

Increasing financial inclusion among women has many advantages both at the business and household level. For women to invest in and grow their businesses, they need access to financial resources. A study conducted by Women’s World Bank in 2013, showed that women transact more frequently than men nd are inherent savers. The 2014 Global Findex shows that, in developing countries, the gender gap in formal savings (an account at a financial institution where the client intends to save) is smaller than the gender gap in account ownership overall (access to an account at a financial institution). This suggests that women are more likely to use accounts to set aside money as savings and increase investments of their financial resources into their homes, the nutrition and health of their families, the education of their children, and their communities. Thus, providing greater access to formal saving instruments allows women to increase consumption of goods and services for personal or household use. In addition, increased savings, and access to financial services, can also create an opportunity or provide an avenue for investment into entrepreneurial ventures. Moreover, these investments in both business and families can contribute to general changes that lead to long term prosperity and security, which includes the reduction in the gender disparity.

Despite the macro and micro benefits of investing in addressing gender disparity, policymakers have not consistently integrated measures to address financial inclusion. Closing the gender gap can be achieved by emphasising the value proposition of women’s financial inclusion. Financial inclusion is key to women participating in the economy and it is necessary to understand the ecosystem in which women live and formulate policies based on their economic and social realities. Thus, healthy stakeholder engagement is critical, based on a commitment to dialogue and engagement among government, central bankers, regulators, and financial services providers.

Improving financial inclusion is one of the key mandate pillars of the Trinidad and Tobago International Financial Centre. As such, the TTIFC is conducting a nationwide survey which will form the foundation for the creation of a Financial Inclusion strategy for Trinidad and Tobago. This is extremely important as a deeper understanding of the financial landscape of T&T can result in a reduction in the existing gender disparities in access to and use of financial services.






Carolina Robino(International Development Research Centre)Carolina TrivelliCarolina Villanueva(Women 20 Argentina)Florencia Caro Sachetti(Centro de Implementacion de Politicas Publicas para la Equidad y el Crecimiento (CIPPEC))Helen WalbeyLuz MartinezMarc, Robino, C., Trivelli, C., Villanueva, C., Sachetti, F., Walbey, H., . . . Marincioni, M. (2020, December 10). Financial Inclusion for Women: A way forward. Retrieved January 27, 2022, from

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