According to the stakeholders, it is important, beyond the recommendations of the study, to build collaborative frameworks that will allow institutions and organisations working in the financial inclusion space to rope in investors who can fund initiatives aimed at promoting the inclusion of women and the youth.
Speaking during discussions at the policy learning event convened by ACET to share findings of the new study titled: “Promoting Women and Youth Financial Inclusion for Entrepreneurship and Job creation: Comparative study of selected sub-Saharan African countries”, the stakeholders noted that upscaling financial literacy initiatives in both formal and informal settings will also be crucial to realising the employment impact of financial inclusion for women and the youth.
Reacting to the findings of the study, which highlighted social and cultural norms as one of the major barriers against women’s and youths’ financial inclusion in the three study countries: Guinea, Sierra Leone and Zambia, they stated that addressing the problem will require including men in developing solutions, largely because of the power shifts in this process. “Men cannot be left out in the campaign for greater inclusion of women in the financial system,” they said.
Prof. John Asafo-Adjaye, Head of Research at ACET, urged participants to ensure that the findings and recommendations of the study were put to good use and not left to gather dust on shelves.
“At ACET, we will continue to work on Financial Inclusion. We currently have a programme on youth employment and skills and we plan to weave financial inclusion into this programme,” said Prof. Asafo-Adjaye.
The event brought together stakeholders from the three study countries to Accra, Ghana to discuss these findings and share experiences on innovative ways to spur the financial inclusion of women and the youth. Panel discussions on women’s and youth’s financial inclusion allowed representatives from the central banks, ministries of finance, financial service providers and researchers to drill down on the findings and discuss what was being done in the countries to achieve inclusion while creating jobs and spurring entrepreneurship among women and the youth.
Presenting the findings of the study, Mr. David Darkwa, Financial Inclusion Technical Lead, at ACET, stated that “African governments are at the forefront of leveraging policy and supply-side market dynamics to build more inclusive economies that empower financially-excluded groups.”
The multi-country study found that cumbersome requirements for opening accounts, lack of assets for collateral, and cultural and social norms that shape women’s access to and control over resources, present major barriers to the financial inclusion of both women and the youth.
The absence of enabling regulations on models like agency banking and interoperability was also a major barrier highlighted by the study, which was conducted with funding from Canada’s International Research Development Centre. It also showed that in all three countries, women’s and youths’ access and usage of financial services were hindered by the legal requirements on financial service providers, such as banks and microfinance organisations, to capture detailed biological and situational data on prospective customers; referred to as Know Your Customer.
Women, particularly in peri-urban and rural areas, find it hard to obtain the right documents due to illiteracy, the informal nature of their businesses and cultural barriers. In some parts of Sierra Leone and Zambia, women are not allowed to own land or can only access it through their husbands.
Youths were also found to grapple with identity issues and age restrictions as they are considered risky clients by FSPs and lack the basic financial literacy to leverage financial products at their disposal. A significant number of Guinean youths under 18 do not have admissible IDs, and the study found that in Guinea, some financial service providers go to the extent of requesting proof of regular salary, which excludes most of the youth who do not have a steady income.
However, mobile devices were identified as promising enablers of access to financial services, both for the 21st century woman and for young adults, with smart phones most common in urban areas and among young males.
To address some of these barriers to women’s and youths’ financial inclusion, the report urges registration authorities to balance legislation on customer and institutional protections with accessibility, in order to ensure that the youth and women who tend to be the most financially disenfranchised due to their inability to present formal identity documentation can register and access financial services with semi-formal IDs.Download publication (PDF, 518.8 KB)