Making Digital Finance Work for Women in the MENA Region: 8 Lessons from the Field
This blog was originally posted on the SEEP Network blog by Chloé Gueguen, Sabal Al Majali, and Julia Hakspiel and highlights a new brief from the Arab Women's Enterprise Fund on how to design and implement digital financial empowerment interventions for women in the MENA region and beyond. The full brief is available to read or download below.
Despite progress over the past few years, the Middle East and North Africa (MENA) region still has the largest gender gap in terms of women’s economic participation in the world. This economic divide also holds true when it comes to financial inclusion - only 35% of women have a financial account compared to 52% for men (Global Findex) This financial inclusion gender gap not only impacts women’s financial independence and ability to manage their financial resources but also their employment prospects and business growth.
While the challenges are significant, so are the opportunities. Governments across the region are adopting financial inclusion strategies that aim to improve women’s access to finance and associated financial services. Innovative Digital Financial Services (DFS) have significant potential to accelerate this process by enabling low-income women to access financial services through non-traditional channels. However, this is not a given. It requires a deliberate approach to ensure that emerging digital finance ecosystems in the region evolve to include women, rather than leave them behind.
In the Arab Women's Enterprise Fund's (AWEF) latest Practitioner Learning Brief, we explore these opportunities and challenges by showcasing 14 Case Studies* and presenting a number of lessons on how to design & implement interventions that can pave the way for women’s digital financial empowerment across the MENA region and more widely. These lessons draw directly on AWEF’s experience of working with DFS service providers in Jordan and Egypt. The Brief aims to encourage others to test and scale innovative approaches to make digital finance work better for women’s empowerment.
Lesson 1: Start by building a holistic understanding of women’s needs and preferences as users of DFS
For Digital Financial Services to be truly inclusive, they first need to be designed with women at the centre. This requires a multi-faceted approach based on a solid understanding of women’s aspirations, daily habits and the life challenges they face, as well as their financial and non-financial needs and attitudes toward technology. The approach should be based on an understanding of women’s multiple roles (as individuals, mothers, entrepreneurs, wives etc.) and the actors that influence them (their husband, children, parents, religious or community leaders, etc.), especially in contexts with deeply entrenched gender norms. In Egypt, AWEF carried out a Market Assessment that enabled us to identify factors limiting financial inclusion and key DFS actors with potential to change how digital financial systems worked for women.
Lesson 2: Make DFS accessible by building inclusive distribution networks
Agents generally represent the primary and most tangible touchpoints for most DFS customers. They market and sell products and provide support and guidance on how to use products and services. However, in MENA, most e-payment agents are male, and women sometimes report feeling uncomfortable interacting with them due to prevailing norms regarding male-female interactions outside the home. AWEF has consequently worked with Fawry in Egypt and Dinarak in Jordan, two leading Payment Service Providers (PSP), to pilot the first female agent e-payment networks in the North Africa and Levant region. The use of female agents has helped to build awareness of and trust in DFS services, enabling Dinarak and Fawry to reach and retain new female customers.
Lesson 3: Integrate Non-Financial Services into DFS delivery
One of the most common reasons for women not using DFS is the lack of knowledge and understanding of how these services function and the benefits of using them. Particularly, in MENA DFS are still new and trust and lack of awareness of such services limit uptake by women. Integrating digital literacy training into the deployment of a DFS solution means a greater chance of success. In Egypt, AWEF is working with Tasaheel, a leading Microfinance Institution, to deliver digital literacy training to female-owned microbusinesses. In Lebanon, BLC Bank worked with the IFC’s Banking on Women Program to digitally deliver Non-Financial Services (training, information, networking or coaching services) via its WE online platform.
Lesson 4: Build upon what women trust and digitize traditional finance models to scale-up impact
While Savings Groups are less prevalent in North Africa and the Levant than in Sub-Saharan Africa, the share of adults in the region using informal savings clubs has been increasing. In MENA, Fintech firms such as CIWA in Morocco, are innovating to digitize Savings Groups’ records, increase security and transparency, bring more flexibility, reduce time spent at meetings and provide members with a credit history that can help them access formal financial services. There is significant scope to extend use of DFS savings products across the region, building trust and awareness.
Lesson 5: Encourage the development of a solid DFS ecosystem that offers products and services that women want and need
To make DFS attractive to women, DFS providers need to move beyond the provision of basic airtime top-ups and offer life-enhancing products and services that add value to women’s everyday lives. Women need to be able to charge their digital accounts and convert money back to cash when needed. They need products that help them transact payments, encourage savings and access social welfare benefits or wages. Use of DFS for payroll or social payments can be effective ways of introducing DFS to new users as shown in the Nafaqa and BSR’s HerFinance case studies presented in our Brief.
Lesson 6: Expand access to universal digital identities to help low-income women build their credit history across borders
MENA currently hosts 35 million migrant workers, 31% of whom are female (UNDESA 2019), and the largest number of refugees globally (IOM 2020). Historically, financial institutions have found it difficult to serve these mobile populations who tend to have limited identity and financial records. Solutions building digital identities, such as the Hawiyati platform developed by Making Cents International, have the potential to bridge this identification gap. Such solutions provide migrant women with an entry point to build their credit history, making it easier for them to access future personal or business loans.
Photo description: Refugees receiving a tutorial on Hawiyati, a digital identity solution developed by Making Cents International. Credit: Making Cents International
Lesson 7: Leverage e-commerce and female consumers’ appetite for social media
The global spread of social media coupled with the rapid growth of e-commerce in MENA is giving rise to new models where content sharing, social interactions and e-payments converge. In Egypt, AWEF partnered with Paymob, a leading Fintech firm, to implement a marketing campaign “#AcceptTheChange” over Facebook and Instagram. Female entrepreneurs are now able to receive e-payments while marketing their products through these new digital marketplaces.
Lesson 8: Invest in sex-disaggregated data analysis to monitor progress and build the DFS for Women Business Case
Without sex-disaggregated data, DFS providers across MENA are unlikely to fully appreciate the latent commercial potential from expanding services to women. Simultaneously governments don’t have data to assess the effectiveness of their financial inclusion strategies. Sex-disaggregated data will enable governments and the private sector to more consciously shape the development of inclusive DFS ecosystems. There are some encouraging developments, as regulators such as Bank Al-Maghrib in Morocco move to address this data gap by mandating Payment Companies to report on gender.
These lessons suggest there are several actions that can readily be taken by governments and the private sector in MENA to catalyze the development of inclusive DFS ecosystems that respond to the needs of women, while allowing them to benefit from, and contribute to, the digital economy.
*The case studies featured in the Brief include institutions across the region, such as Fawry, Raseedy/Tasaheel, Paymob, BSR’s HerFinance, BLC Bank of Lebanon, JOPACC, Dinarak, the Women’s World Banking, CIWA Morocco, MakingCents, Kalys Tunisia, IFC Morocco and Bank Al Maghrib.
Chloé Gueguen is a digital finance specialist and co-leads AWEF's Financial Inclusion program in Egypt. She is also a Consultant for the IFC MENA Banking on Women Program, advising financial institutions on how to better cater to female clients in Morocco and Tunisia.
Sabal Al Majali is a Lead Market Analyst at AWEF. Sabal co-leads AWEF's Financial Inclusion program in Jordan, including developing and implementing the program strategy, focused on catalysing access to digital financial services among underprivileged women.
Julia Hakspiel is the Learning Manager for AWEF and Senior Specialist with MarketShare Associates, a member of the AWEF consortium. She is also the co-facilitator of the Women’s Economic Empowerment Working Group at SEEP.
The full brief is available for download below.