The most recent version of the African Women’s Report was released today. The report examines the African digital finance ecosystem’s various elements and how they affect women’s opportunities for economic advancement. It identifies five major obstacles to using digital money in Africa as a driver of women’s economic development. The Economic Commission for Africa (ECA) has published research on how African governments can ensure that their digital ecosystems promote women’s economic empowerment rather than hinder it. The study suggests that national household surveys should include sex-disaggregated data on internet usage, mobile ownership, and financial literacy.
A recent study reveals enduring obstacles in the digital banking industry that prevent African women from achieving economic empowerment and suggests policy solutions to remove them.
The most recent version of the biennial African Women’s Report, which the United Nations Economic Commission commissions for Africa (ECA), was released today. The report examines the African digital finance ecosystem’s various elements and how they affect women’s opportunities for economic advancement.
The paper identifies five major obstacles to using digital money in Africa as a driver of women’s economic development. First, despite having the highest number of mobile money services worldwide, women’s access to digital services, including mobile and internet, is restricted in Africa because of illiteracy, cost, a skills gap, and societal conventions.
Second, while women’s digital financial abilities have improved significantly, Africa is still lagging behind other continents. For instance, the percentage of women in North Africa who are proficient in digital banking has increased from 12.5% in 2014 to 25.7% in 2018, exceeding the global average of 20%. The same percentage is only 12% for the entire continent, though.
Third, only 33% of African women and 43% of African males have formal bank accounts. This disparity increases women’s susceptibility and exclusion from lucrative industries, legal employment, and restricted access to economic resources. Fourth, women are negatively impacted by social norms as well as built-in biases in financial practises, products, and services.
Finally, because women are underrepresented in decision-making processes and in the financial and technological sectors, it is doubtful that digital finance rules and products would consider women’s perspectives and needs. Additionally, women are nine times less likely than males to have formal identification in some African nations, which limits their ability to freely access, own, and use digital finance services.
Ms. Edlam Yemeru, acting director of the ECA’s Gender, Poverty and Social Policy Division, commented on the report in the following way: “Africa is a global leader in several transactional technologies, such as mobile money, but there is still significant room to scale up digital finance and ensure that women can fully capitalise on the opportunities that result from it. Many obstacles related to connectivity, digital literacy, cost, legislation, and culture must be removed to do this.
“Our research takes a holistic approach to looking at the digital finance ecosystem and provides policy choices for governments to further expand the industry and accelerate financial inclusion while paving the path for women’s economic empowerment – leaving no one behind,” she stated.
The research offers ten policy options for governments to consider to ensure that their country’s digital ecosystem promotes women’s economic empowerment rather than hinders it.
Women’s representation in the sector should be prioritised, individuals should be trained in digital finance, especially women, regulations should be changed to encourage the use of mobile money, and gender-sensitive policies that integrate technology and social development should be developed.
To help develop pertinent policies, the research suggests that sex-disaggregated data on internet usage, mobile ownership, and financial literacy should be included in national household surveys.
It also suggests incorporating digital finance frameworks into country-specific development goals and collaborating with credit bureaus to address the possibility of ingrained gender biases in credit reporting systems.
The research concludes by urging African nations to create regional frameworks for digital financial regulation and justice, utilising the African Continental Free Trade Area as a base to facilitate digital identities and enhance cross-border collaboration.
A flagship product produced by the ECA every two years is the African Women’s Report. ‘Digital Finance Ecosystems – Pathways to Women’s Economic Empowerment in Africa’ is the topic of the most recent issue.
Analysis by: Advocacy Unified Network