Financial inclusion of women – Value chains as a starting point to build for her

The world is designed for men, Caroline Criado Perez will tell you. More specifically, she’ll say “the design of our world is based on the assumption that men are the standard, and women are the exception”- the anomaly who must morph and twist and stretch herself to “fit”. In 1929, Virginia Woolf wrote, a woman must have moneyand a room of her own! But how does a woman go about building a room of her own when pathways to economic empowerment are rarely built on the foundation of women-centric experiences? 

Access to finance can often be the difference between economic empowerment and a lifetime of struggle for survival. It is 2023; a majority of the 60 crore Indian women continue to struggle. 

The gender gap in women’s access to financial inclusion persists at reprehensible levels. The 2021 Global Findex report indicates a 12% gap in the usage of bank accounts, with many women using their accounts only for direct benefit transfers. Various studies reveal that women constitute less than 30% of retail borrowers, 14% of total credit outstanding, and 32% of life insurance policyholders in India. Another study finds that women in India receive credit for just 27% of their deposits, compared to 52% for men. The 2018-19 ICRIER-NABARD study revealed that among all the G20 countries, India had the largest finance gap for SMEs owned by women! (This hits hard especially as we celebrate our G20 presidency). Further, women own only about 20-30% of household wealth in India, significantly below the global average and women landholders account for only a sliver – about 4% – of agricultural land among all land-holding adults in India. 

To list these figures is not to discount serious efforts that have gone into expanding the financial coverage of under-served groups in India over several decades. Besides policy initiatives, inclusive fintechs have notably demonstrated massive potential in designing and delivering a range of products for the low income customers. Unfortunately, however, most of these products (popularly called gender neutral) are ill-suited for women. For instance, digital payments that became mainstreamed (and how) during covid are more likely to be used by men for two key reasons – in low income households – men own smartphones and bank accounts. Thus, though unintentional (!), women continue to be left out of the target market. 

Make Space for Gender Intentionality 

To effectively render inclusive digital financial solutions for women, fintechs need to design sharply targeted solutions that align with women’s socio-cultural context (or, obstacles) and interactions with financial services and phygital channels. In recent years, this has entailed an increasing recognition of the need to transition from ‘gender neutral’ to ‘gender intelligent’ or ‘gender intentional’ product design strategies. 

Currently, India has about 100 to 125 million women in low and middle income segments. To reach these customers, fintechs will have to go beyond superficial female-friendly (read, pink) variants of base products and develop meaningful customer-value propositions that provide tailored solutions with proper incentives. To achieve this, it is crucial to not lump all women as a homogenous customer group. Instead, fintechs must develop evidence-based understanding of the complex and

diverse lived experiences of women in India. To examine the depth of this diversity, consider the example of two largely ignored (women) customer segments in India – fisherfolk and dairy farmers. 

Case in Point: Comparing women in fishing and dairy in India 

Fishing and dairy value chains will collapse in absence of women. We make up 44% of the workforce in fisheries, and 70% of the 10 million fully dairy dependent households. Production in both sectors are informal, fragmented, low tech, not capital intensive, marked by poor productivity and value addition. Market linkages are weak and informal, often resulting in exploitative credit-linked pledging of produce to traders and intermediaries, and poor price realization. 

In particular, women in these value chains face multiple other challenges. For example, women fisherfolk are often expected to limit their fishing exploits to rice fields, streams and ditches. Similarly, women dairy farmers are limited within the households doing all the unpaid labour while not participating in any market-facing activities or income realization. As a second order result of mobility constraints, women in both industries have little access to important resources such as information, networks, training etc. which makes it harder for them to join collectives, secure formal credit, or establish produce-linked micro-enterprises. 

Aside from the shared struggles, women’s participation in fisheries and dairy is not alike. In fisheries, women are mainly concentrated in post-harvest activities (closer to the market side of the value chain) like sorting, grading, cleaning and primary processing of fish in home-based environments, processing sheds or wet-marketplaces. In several parts of the country, women take the lead in fish vending as well as auctioning at landing centres. 

On the other hand, women in dairy take on nearly the entire burden of work (often invisible and under-compensated) spanning all stages of the production part of the value chain from animal care, to shed management to milking. Unlike female participation in fisheries, women practice dairy farming as an extension of household work. The gendered division of labour within households also divests women from participating in decisions on production choices and allocation of resources within the household. 

For a fintech designing inclusive fintech solutions therefore, women in fisheries and dairy represent overlapping but different problem statements. Fintechs building for women in fisheries can aim to locate in the market side of the value chain (which has a higher presence of women). On the other hand, fintech solutions for women in dairy could be best delivered if reached to the woman at her doorstep. Fintechs aiming to build for women and capitalise on the massive unaddressed market, must fold such a sharp understanding of the customers in their product design and GTM. 

Women are prudent, keen and adaptable. Grassroot microfinance experiences have repeatedly demonstrated that, with the right tools and resources, offered at the right time and place, in the right way, women are capable leaders and ambitious entrepreneurs. It is time we invest in the data reserves, research and product strategies necessary to #buildforher. 



Views expressed above are the author’s own.


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