Rose Kibona sells prepared food and drinks to passers-by from a small stall at the bustling local market in her hometown of Mbeya, Tanzania. At the end of each work day, she put her earnings into various savings accounts — which, in her case, were jars, bags and a locked chest hidden away in her bedroom — each one for a different purpose.
She Counts is an international effort launched this March to support unbanked women micro-entrepreneurs like Kibona by giving them mobile savings accounts. It’s a collaboration between the CGD, Women’s World Banking (WWB) and the ExxonMobil Foundation to reach more than 1 billion women worldwide who lack easy access to banking services.
The organization also aims to push financial institutions to serve more of these women. “Traditional social norms [around the world] often further restrict women’s access to productive resources and services, with negative economic consequences,” She Counts says in a recent report.
Gender stereotypes can influence how banks craft and distribute financial products in ways that make it harder for women to get the help they need, WWB CEO Mary Ellen Iskenderian says.
This lack of access to formal banking harms women’s businesses. When women like Kibona keep cash in their homes, Buvinic says, the men in their families may take control of it. Or, they may succumb to social pressure from relatives to share their wealth. In these situations, the money doesn’t go back into their ventures. “It’s rather inefficient, almost dangerous, for money to be stacked in her bedroom.”
To tackle the problem, She Counts is providing unbanked women with mobile savings accounts and business training seminars designed to help them “save securely, invest in their business and transform their lives,” according to its website.
Finding and Bridging the Gap
She Counts’ approach is based on learnings from a 2-year project with 5,000 women business owners — including Kibona — in Tanzania and Indonesia. The project looked at the impact of mobile bank accounts and business training opportunities on increasing savings and sparking entrepreneurial growth.
The research was inspired by previous studies on unbanked women showing a troubling state of affairs. “Despite a half-billion rise in the number of formal bank accounts opened between 2014 and 2017, a stubborn seven-point gender gap in access remains worldwide — and nine points in developing countries,” the She Counts report says, citing the 2017 Global Findex.
She Counts sought to answer two questions: “How can we encourage more women micro-entrepreneurs to access formal savings accounts, and is mobile saving a particularly fitting solution?”
Buvinic, one of the report’s authors, says mobile savings accounts are effective because they are “institutionalized and formal, and provide some privacy.” And, they eliminate the need for women to spend bus fare or find child care to go to a bank branch.
The researchers started their work in Tanzania, where they split program participants into three groups: one that received access to a mobile banking platform, one that received business training in addition to mobile banking services, and a control group which received no support.
The women who received both business training and mobile banking services saved the most money — five times as much as the control group. But even access to mobile banking alone made a difference; that group saved three times as much as the control group.
The combination of savings and training “protects women, helps empower them,” Buvinic says. Women “earn a lot less than what they should be earning,” so efforts to both lift their earnings and help them manage their money are needed to make a real reduction in poverty, she adds.
These women also became empowered to take bigger leaps with their ventures, Iskenderian says. It’s not that women are risk-averse, she notes. Rather, they are “risk appropriate,” and need to feel on solid ground to take steps forward. “Women will set up a savings account, make sure a comfortable amount is in it, and then maybe acquire health or property or life insurance. She’ll make sure she’s protected against the risks she and her business are likely to face.”
Meanwhile, in Indonesia, researchers are examining the service side of the problem. They are giving banks financial incentives to sign up women for their mobile savings products, and studying what differences those products make for female entrepreneurs who receive business training from She Counts. Results are expected later this year.
She Counts is working with Indonesian business owners like Siti Nurhasanah, a tailor. She owns a small shop that she runs from her home, making clothing from traditional batik cloth. She and her three employees process about 100 orders per month.
Nurhasanah said in a video interview with She Counts that she wants to buy a storefront location closer to town, and to pass the business on to her children one day. The savings tools and training programs provided to her were “exciting,” she said. “As a mother, I’m so happy and grateful” to have them.
Making Global Changes
Researchers eyes are also trained on the longer-term results of their pilot programs. They are watching closely to see if mobile savings improve previously unbanked women’s business practices, incomes, savings and profits over time. A follow-up study is currently underway in Tanzania.
In the meantime, She Counts will continue to provide mobile banking, business training and literacy services where it can, with the help of other global partners, Buvinic says. It is also looking for additional ways to incentivize banking professionals to work with underserved women, which it believes is a key component to leveling the playing field. “They don’t treat women as well as they treat men in [the banking] sector. It’s an area with huge biases,” Buvinic adds.
Indeed, a big part of effecting change will involve a team effort with the leaders of banks, mobile service providers and like-minded organizations. To turn study results into future products that truly benefit women micro-entrepreneurs, Iskenderian says, institutions and power players must “listen to what women need, how they spend and what they save, to make sure tech meets them there.”