Cellphones for Women in Developing Nations Aid Ascent From Poverty
Friday, April 3, 2015
Here is what life is like for a woman with no bank account in a developing country. She keeps her savings hidden — in pots, under mattresses, in fields. She constantly worries about thieves. She may even worry about her husband taking cash she has budgeted for their children’s needs. Sending money to a family member in another village is risky and can take days. Obtaining a loan in an emergency is often impossible.
An unexpected expense can mean she has to pull a child out of school or sell a cow the family relies on for income. Or, worse, it can mean she must give birth at home without medical assistance because she doesn’t have the money for a ride to a clinic.
In ways big and small, life without access to financial services is more difficult, expensive and dangerous. It constrains a woman’s ability to plan for her family’s future. At the community level, it traps households in cycles of poverty. More broadly, it limits the economic growth potential of developing countries.
So it is not hard to understand why the spread of new digital financial services to the world’s poorest places has been heralded as a breakthrough with the potential to alter the global economy. Digital financial services offer the world a huge chance to connect more than two billion people to their first bank accounts, lift millions of families out of poverty and accelerate the participation of developing countries in the global marketplace.
But this vision of the future won’t materialize on its own. Unless we make a course correction, it won’t materialize at all. For digital financial services to achieve their full impact, we must be deliberate about ensuring that these services are reaching an especially crucial group of economic actors in developing economies: women.
Even though this technology is spreading rapidly, it is not spreading to women equally. Consider Bangladesh, where four out of five people do not have traditional bank accounts. Thanks to fast-growing digital financial services companies like bKash, mobile money is transforming the way Bangladesh does business.