India’s Women Business Correspondents are Struggling: Three Steps to Increase Their Viability – And Boost Financial Inclusion
India is home to 17% of the world’s total female population. Yet the country has traditionally viewed women mainly as caregivers and homemakers. And though the workforce participation rate of women has seen a marginal rise from 17.5% to 22.8% between 2017 and 2019, the gender gap persists. Men’s involvement in the labor market stood at 56.8% in 2019-2020, more than double the rate of participation of women in the same year.
The choice and capability of Indian women to engage in the working world depend on various social and economic factors that are often dictated by others. For instance, women are often typecast to be suitable only for certain roles and sectors – and this is also reflected in their skilling. Furthermore, women’s lack of mobility and their need for a more secure work environment are also touted as reasons for not employing them. But over time, researchers and policymakers have seen the value of increasing women’s economic empowerment, a goal that has become a common focus of development programs. Boosting women’s participation in the labor force is increasingly recognized as an essential tool to achieve broader development goals, such as economic growth, poverty reduction, health, education and welfare.
In light of this persistent challenge, Grameen Foundation has worked to increase women’s employment as Business Correspondents (BCs) – retail agents engaged by banks to provide banking services at locations other than a bank branch or ATM – through our Grameen Mittras program. The program aims to bring more women into India’s labor force while also addressing a persistent gap in the country’s financial inclusion efforts. Though the BC model, introduced by the Reserve Bank of India in 2006, has been a key driver of financial inclusion in India, it has struggled to appropriately support the full inclusion of underprivileged populations, especially the 223 million women who hold bank accounts through the country’s Jan Dhan Yojana financial inclusion program. While these women account holders represent 53.3% of the program’s total base of 420 million Jan Dhan Yojana accounts reached by 2021, 55% of these women remain registered inactive users.
Grameen Mittras (which means “friends of the village” in Hindi) are well-placed to reach these women while also empowering themselves in the process. Results from an internal assessment of the Grameen Mittras model in the district of Nashik found the job enabled women to overcome personal, cognitive, material and perceptual barriers as they progressed toward economic empowerment. The study showed that women who became BCs through the Grameen Mittras program improved their financial independence, gained greater buy-in within their families to partake in household financial decision-making, and increased their ability to mobilize and manage money. They also understood financial instruments, which helped them support their communities’ efforts to plan their finances better and achieve their short, medium and long-term goals.
Understanding the Struggles of Women Business Correspondents
However, the Grameen Mittras have also faced some struggles that have highlighted broader challenges within the Business Correspondent model. Despite the rapid strides they have made in recent years, women still form less than 10% of the BC workforce in India. Women BCs continue to face a lot of roadblocks and gender-based discrimination that hinder their empowerment. Across multiple (as yet unpublished) studies conducted by Grameen Foundation, the following key challenges for women BCs were highlighted:
- Gender roles and societal norms limit women’s ability to take up additional roles: Though over 90% of women BCs in the Grameen Mittras studies reportedly received support from their families, this was preconditioned on their ability to manage the household chores along with their BC work. The study also found that 50% of woman BCs had to seek permission from their husbands or other family members to step out of the house for work. This conditional support often limited their ability to deliver as BCs.
- Women face a lack of technical and functional skills and an enabling ecosystem: The absence of these skills and support further exacerbates the challenges faced by women BCs. Our study in Nashik found that 34% of woman BCs felt that their lack of technical and digital skills prevented them from excelling in their jobs. Furthermore, their interactions with peers and supervisors, and the perceptions of their clients – who often don’t view them as financial service providers – resulted in poorer work satisfaction. For instance, the baseline study for the Business Correspondent Network Managers (BCNM) Experiments for Demonstrating Scale (BEADS) project found that women BCs were 59% less likely to be satisfied in their work roles than their male counterparts. In response, the BEADS project engaged BCs from six BCNMs and banks to pilot interventions to augment BC viability, better integrate women into the BC workforce, and aid client education efforts.
- Women BCs struggle with financial viability: Even though the BC channel has seen significant growth in the number of customers and exchange volumes, the agents continue to struggle to build sustainable BC businesses. And women have it worse: The BEADS study found that, when compared to male BCs, women BCs reported a 72.5% less likelihood of experiencing an increase in their incomes. The Grameen Mittras study also highlighted that clients’ tendency to not perceive women BCs as financial service providers limits their ability to engage customers and earn more revenue.
Three Steps for Enhancing the Viability of Women Business Correspondents
Grameen Foundation is conducting an action research project across 10 states in India, with generous support from the Bill and Melinda Gates Foundation, to test out multiple strategies to enhance BCs’ financial and operational viability, especially for women. These strategies include the following key elements:
- Facilitating gender dialogues with the families of women BCs: At the time of recruitment, it’s important to help women’s families gain a greater understanding of the BC role, and the value their work as agents is creating for their immediate community and family members. This conversation should also encourage family members to share the responsibility of performing household tasks. Gender dialogues have proven to be an effective tool to create buy-in for women BCs within their households.
- Providing change management workshops and gender sensitivity training: Grameen has introduced this training under the BEADS project, engaging upper- and mid-level management to facilitate the adoption of gender-sensitive practices by BC supervisors. This training will be extended to the BCs participating in the BEADS project through subsequent BC training. It will aim to equip BC supervisors and male agents to engage with women agents better, and to develop a more supportive and enabling environment for women agents.
- Expanding the product basket and marketing assistance: Grameen has partnered with six leading BC network managers who have a pan-India presence to pilot the expansion of their product baskets and assess these products’ impact on BCs’ income, while creating value for the end customer. Furthermore, we are working with these BC network managers to assist agents with marketing and customer education efforts, in order to establish their presence in the community and expand their outreach. All these efforts aim to contribute toward augmenting the viability of BC businesses.
Women are the pillars of Indian society and the key to ensuring the financial resilience of their households. Women BCs, in particular, are essential to deepening financial inclusion in the country. Empirical evidence suggests that women BCs advance financial inclusion for women, stay in business for a longer duration, and serve rural areas more than their male counterparts. In summary, financial inclusion is incomplete in India, as is women’s economic empowerment. The country can help address both of these challenges by supporting women business correspondents as they continue to reach un- and under-served customers while building sustainable livelihoods for themselves and their families.
Photo credit: Simone D. McCourtie / World Bank