According to a study released recently by Massachusetts Institute of Technology (MIT), the increased use of mobile money services has lifted 2 per cent of Kenyan households from extreme poverty in the past nine years.
The study further states that women-headed households have especially benefitted from mobile money services through improved financial management in terms of savings, and formation of more diverse risk-sharing networks.
This has made women who previously did not have access to banks and financial institutions have better control of their money, did away with middlemen in money transfer, better protect themselves against economic shocks through services such as M-Shwari and KCB M-Pesa – through which they can save and borrow, and in the end made them economically resilient.
Economists Taveet Suri and William Jack, from MIT, say that the services have increased daily per capita consumption levels of many poor homes from survival level of less than Ksh125 ($1.25) a day.
Mobile money services have shown us the transformational power of the digital economy and I am especially happy that women have been the major beneficiaries of the transformations we have witnessed so far.
There is an incredible amount of possibility that the digital economy bears for women, both as creators and beneficiaries.
Women entrepreneurs have, before them, opportunities unlike any they have had before. The digital economy can be the best tool to use to reduce the gap between men’s and women’s participation in the financial sector, increasing both the volume and the value of transactions.
Although we now have access to better-quality and better-tailored financial services through digital services, particularly microfinance, we still have a long way to go to catch up with our male counterparts.
Some of our limitations are inherent, it has been scientifically proven we are more risk averse than men, but we have, for the first time, an environment where starting a business does not require you to fill forms asking if you are married to qualify for a loan and you do not have to pay middlemen to get a business licence.
All that is needed is for you to have a computer, internet connection and a mobile service provider’s line for money transfer. You can register online and pay for your license and you are good for business.
Therefore, the immediate result of the digital revolution is that we now have at least the avenue to be part of a country’s labour force because we can access opportunities remotely and manage businesses through the digital financial solutions.
The greater resultant financial autonomy women have is good for the overall improvement of the quality of life of the household.
The Global Findex, which is the world’s most comprehensive database on financial inclusion, shows that in developing economies, women are less likely than men to have formal bank accounts and less likely to have borrowed formally (2014). Women may also not be able to own property, complicating their ability to provide security.
Mobile money accounts have made great strides in ensuring financial inclusion in regions such as Sub-Saharan Africa.
12 per cent of adults in sub-Saharan Africa have mobile money accounts, compared with 2 per cent of adults worldwide (Global Findex 2014). This sub-Saharan statistic includes 10 per cent of women. 45 per cent of those who have mobile money accounts use only those accounts for their financial transactions.
Findex data shows that in countries such as Cote d’Ivoire and Kenya, even though there may be a gap between men and women in bank account ownership, there is no such significant gap in mobile money service accounts.
This is because the way these mobile money service accounts work is in a way that is perhaps inadvertently tailored to the needs and realities of women as women may not access formal bank accounts because of family responsibilities, lower wages (and so inability to have the minimum balance usually required) and/or cultural norms. Even so, in some countries, the gap still exists.
Women’s use of ICT
The digital economy comes in to women’s aid, again, as digital transactions such as utility and rent payments are, more and more, becoming an important source of information for credit decisions, as they may be used as history for women who would like to seek credit from formal financial institutions.
Challenges affecting women’s use of ICT include the lack of foundational literacy for girls and digital skills, which comprise digital financial literacy, as has been recognised by various key decision-makers. Socio-cultural constraints surrounding girls’ use of ICT is also a recognised problem.
There are too few women in the ICT sector, and this affects the possibilities made available to women as well as the enthusiasm with which women are targeted because they are not as well represented as they could be.
Considering the gap between men and women in accessibility to IT, education on digital skills should start right from the earliest stages of learning and especially so for women, as well as their encouragement into science, technology, engineering and mathematics (STEM) so that they, too, can create opportunities for themselves that serve their needs — so that they, too, can see ICT as bearing possibilities for them.
All institutions in the public and private sectors should do all that is in their power to create policies that ensure participation of women in the financial sector because when we come together, great things happen.
Sylvia Mulinge is the director of Consumer Business at Safaricom, a mobile telecommunication company.