Gender Inclusive Finance Roadmap brings hope for women

By Ntombi Mhlongo

If the recommendations contained in the first-ever Eswatini Gender Inclusive Finance Roadmap will be implemented, then the financial exclusion of women will be a thing of the past. The roadmap was launched by the Central Bank of Eswatini in partnership with stakeholders including the Centre for Financial Inclusion, the Financial Services Regulatory Authority (FSRA) and the Alliance for Financial Inclusion (AFI) and the Ministry of Finance.

The roadmap, it was stated, will be a live document focused on the monitoring and evaluation, roles and responsibilities and prioritisation which are all detailed in the implementation plan.

It calls upon all stakeholders to concentrate their efforts and resources on the inclusion of women and ensure that they are not left behind but are allowed the opportunity to contribute equally to the growth of the economy of the country.

In the document, it is stipulated that the initiative is the government’s commitment to ensuring that women are not treated differently from men but are given equal opportunities while at the same time ensuring that no man is left behind to avoid creating another developmental challenge.

It is contained in the roadmap document that the main barriers to women’s financial inclusion in the Kingdom primarily fall into five categories which are; legal and regulatory, infrastructure and data, supply-side and social and cultural norms.

One of the initiatives recommended for Eswatini, as contained in the roadmap, is that the country should institute appropriate legal and regulatory reforms.

“There is a need to create space for innovation that supports greater financial inclusion for women, including changing unfavourable cultural norms. Women should have equal rights to fixed properties and should equally participate in economic activities,” reads part of the document.

Another initiative is that the regulatory framework that governs SACCOs should be strengthened.

This will enable the SACCOs to play a meaningful role in women’s economic empowerment and poverty alleviation.

The SACCOs, it is argued in the document, have played a key role in the financial inclusion agenda as they enable members to access loans, guarantees and other financial instruments that will enable members to access capital.

Also included in the initiatives is the adoption of the agency banking model which it is argued will increase the proximity of financial products and services to clients, especially in rural areas.

“The regulatory framework should promote women agents, as evidence shows they are in a better position to better serve other women through channels that are closer to communities,” it is mentioned in the document.

It is also argued that in most developing countries like Eswatini, the majority of women entrepreneurs lack a basic understanding of finance, and thus are not able to make informed choices about the current and future use or management of their money.

The document says financial education programmes targeted at women will enable them to acquire knowledge, skills, attitudes and behaviour that promote awareness and responsible uptake of financial opportunities, thereby facilitating informed choices, which are consistent with their circumstances.

“Furthermore, promoting financial education is a pillar for sustainable financial inclusion, with women saving, accessing credit, making financial investments, and taking insurance to cover themselves and their businesses against financial shocks,” it was highlighted.

As part of the recommendations for women’s inclusion leveraging on digital platforms, it is proposed that the country should digitise informal infrastructures such as community women’s savings groups, women collectives and informal credit schemes among others.

Another recommendation is the facilitation of the development of low-cost payment platforms such as agent networks.

Meanwhile, lack of acceptable collateral was listed as one of the challenges faced by a majority of women in the Kingdom of Eswatini when accessing finance from banks.

In this regard, a recommendation is made that financial service providers should adopt innovative models of financing, which provide for collateral substitutes such as group guarantees, collateral registry and credit reference systems.

In terms of analysis, it was revealed that the current position of women’s financial inclusion in Eswatini is that many face barriers to accessing and opening an account, accessing credit for their businesses and having the income levels and financial literacy needed to safely and effectively use a wide range of financial products and services.

The analysis reflects that women in Eswatini generally operate at a very small scale, and in non-innovative low-productivity industries.

Resultantly, only 31 per cent of women-owned businesses are in the high-growth target group.

The roadmap will be framed through three strategic pillars of financial inclusion namely: access, usage and the quality of the provisions of the various products and services available to women.

It will look at these through both the supply and demand-side constraints and opportunities and it will be underpinned by various cross-cutting themes including the legal and regulatory framework, the availability and use of sex-disaggregated data, infrastructure financial literacy and education and governance.

…Only 27% of women own high-growth MSMEs

Only 27 per cent of women entrepreneurs own high-growth MSMS businesses compared to 45 per cent of men.

This is contained in the Eswatini Gender Inclusive Finance Roadmap which was launched on Thursday.

Worth noting is that the MSME sector contributes an estimated 45 per cent to the national GDP and 33 per cent to the national workforce.

The roadmap reflects that 75 per cent of MSME businesses are informal and women account for the majority of 74 per cent of the independent entrepreneurs.

However, the roadmap states, that although 75 per cent of the entrepreneurs have their businesses as their only source of income, 53 per cent have very low levels of income.

“Addressing the barriers women face in being able to fully exploit the economic opportunities they could develop if given the opportunity and skills is holding back their economic progress and thus the progress of their families and communities,” the roadmap document states.

Speaking at the launch of the roadmap, Central Bank of Eswatini (CBE) Deputy Governor Felicia Dlamini-Kunene emphasised that this is a tool aimed at integrating women and the youth in all financial engagements.

She pledged that the CBE would provide all the necessary advice and support for the proper implementation of the roadmap.

“This should be done in a responsible and sustainable manner. Therefore, it is important to understand the dynamics of the economy and the population to safeguard against potential risks. Another important risk to guard against is creating unintended exclusion through innovation and digital transformation in the financial sector. This will require consumer empowerment and continued research to understand the impact of these initiatives,” she said.

She said the next step is to deliberate on actions that will be implemented as a country to close the gender gap in financial inclusion. 

This, she said, will contribute to the global commitment to achieving gender quality and empowering all women and girls under the UN Sustainable Development Goal number 5. 

“As the Central Bank, ours is to implore the financial institutions to build and develop internal capacity to better understand women as an important market segment and create a support culture change that will effectively serve women,” she mentioned.

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