During our chat, we talked about the risks of leaving oral communities behind, creating truly inclusive programs, closing the gender gap in financial inclusion and how COVID-19 is transforming digital financial services.

How would you define holistic financial inclusion?

Holistic financial inclusion moves beyond conventional financial products and services, such as basic savings accounts and micro-loans, which still do not seem to reach the poor and women well. It is a way of designing financial services that accounts for the high barriers to entry faced by low-income women, such as literacy, mobility limitations, geographic isolation. It is services that embed social and gender norms within the product design and delivery – including parallel investments such as household and couple’s dialogues – for a completely customer-centric experience.

For example, in Uganda CARE piloted a digital sub-wallet specifically with women’s financial behaviors in mind. A digital sub-wallet is an e-pocket for savings for a specific purpose like purchasing land, paying school fees, or saving for a wedding. CARE paired the sub-wallet with household dialogues to address intra-household power dynamics and decision-making. High uptake of the dialogues and success of the pilot underscores that can be highly effective to integrate gendered approaches into financial products and services to overcome informal structural barriers that women face in accessing and using financial services.

As you mentioned in your article, there’s a chance that oral cultures/communities will be left behind in the progress towards financial inclusion. How can practitioners create more inclusive programs?

As Brett Matthews’s paper on orality and financial inclusion describes, for holistic financial inclusion to truly live up to its name, service providers need to understand the numeracy needs of their customers. While mobile technology seems destined to become the norm for many financial products and services, practitioners need to find ways to marry the low-touch technologies, access, and apps with more high-touch co-creation and learning process that account for differences between the literate and oral cultures.

Keeping traditionally excluded populations in mind while testing and creating delivery models or products will ensure access and usability for all. Such designs have been field-tested to measure basic numeracy and financial numeracy. This will help to diagnose the mismatch between existing product interface designs and the typical information needs of oral populations. Taking this approach and adapting business records, microcredit contracts, savings group ledgers and other documents for oral use can help bridge the digital divide and empower oral communities and low-numerate adults to manage financial transactions and keep their own microenterprise records better. Creating programs that meaningfully include these populations result in shared responsibility for record-keeping and transaction processing in groups and increases democratic governance by enhancing the ability of all members to exercise oversight or catch errors.

Let’s talk about digital financial services. How should DFS programs respond to the COVID-19 world?

This pandemic has made two things very clear: access to high-quality financial services is more important than ever and digital financial services are a key to financial resilience during this uncertain time.

Without access to financial services, those who have been hardest-hit by the economic impacts of COVID-19 also face barriers to accessing the financial support being offered in response. 1.7 billion unbanked adults have no mechanism to receive, for example, government stimulus payments. Considering the public health-related limitations on going physically to banks, DFS plays a critical role in enabling low-income men and women to survive the immediate economic crisis of the COVID-19 pandemic as well as thrive in the coming months and years. DFS providers – from governments to micro-finance institutions (MFIs) – can reach vulnerable populations and customers quickly, find out their needs, and provide them with emergency services, mitigating the immediate financial pinch of lost wages, remittances, and limited mobility. We are seeing innovations around government to person (G2P) payments across the globe and digital savings groups bringing vital information and services to last-mile populations.

These uses are promising and are a reason for hope, however, the global mobile phone gender gap is around ten percent, meaning that women have less access to these types of services than men. A recent publication on digital cash transfers focuses on this gap and makes key recommendations on, among other things, broadening agent networks, increasing women’s account ownership as a default on G2P schemes, and utilizing informal savings groups as a way to reach women.

What type of disruptive collaboration is needed to accelerate the progress of digital financial inclusion? Which key sector players are you looking up to?

As we navigate through the global economic crisis brought on by COVID-19, I’m looking to policymakers to put consumer protection principles at the front and center of their emergency and recovery plans. Personal financial resilience and resources are limited – in moments of crisis, social cushions and networks play an even more important role in stabilizing household incomes and personal livelihoods. Policymakers have a critical role to play in shoring up access to credit, emergency funds, and information by encouraging and supporting FSPs and other providers to remove lending barriers, fees, and modify or extend loan repayment schedules. Governments also play a big role in catalyzing digital financial inclusion; when G2P payments that were traditionally made in cash switch to electronic payments, this encourages individuals to develop formal relationships with DFS providers. Governments can develop their digital payments infrastructure to enable electronic G2P payments and work with providers to design products that serve recipients of G2P payments.

Ensuring vulnerable people can weather this crisis (and the next) as well as their everyday lives requires a multi-stakeholder solution. Policymakers, providers, and non-governmental actors all have roles to play in understanding why people are vulnerable to economic shocks as well as designing products and services that are accessible to low-income customers and meet their needs.

On the gender front, what are some of the tallest barriers to women’s financial inclusion? And how can we overcome these?

The global gender gap in account ownership persists and women’s access to, usage of, and confidence with mobile technology continues to lag behind men’s.

The biggest barrier, and the one behind these gaps, is providers’ reluctance – and sometimes outright refusal – to grapple with the gender and social norms facing men and women that shape women’s preferences and ability to use financial services. I can understand why providers may feel like gender norms are outside of their purview. But until every actor in our industry realizes that women’s financial needs, the barriers they face, and their hopes and dreams are inextricably linked with the gender and social norms that shaped them from birth, the gaps will persist.

This starts with policymakers and regulators taking an ecosystem approach to understanding women’s lives and need. The enabling environment, that is, the social safety net, care responsibilities, time and mobility limitations, etc., plays a gate-keeping role in how and whether financial services are used by women. Insurance, direct payments, linkages between informal financial services with formal financial systems level the playing field for vulnerable women globally. I also urge providers to view gender norms as a critical element in customer research and market segmentation. After all, the more you know about your customers, the better able you are to provide products and services they will want to use. Building gender norms into products and services may mean small – or bigger – product tweaks. For example, as outlined in CARE’s article in our Development in Practice volume, building a product like the sub-wallet that accounts for women’s long-standing practice of keeping private funds.

You observe that Brazil, Mexico and Iran have drastically reduced their gender gaps in account ownership. How promising are these results and what did they do right?

For these countries, the reduction in gender gap is largely a result of G2P schemes that target women. For example, Prospera Digital, a conditional cash transfer program in Mexico, digitized all payments to recipients, 98 percent of whom are women. As a result, Mexico’s gender gap in account ownership is 4 percent, much smaller than the global average of 9 percent.

While this is a step in the right direction, research from Women’s World Banking reminds us that account ownership does not equate account usage or value. A vast majority of Prospera’s recipients are rural and they cash out their bi-monthly payments in full due to lack of banking infrastructure near where they live. Even among urban recipients, cash-out is still the default. Access to an eco-system of financial products and delivery channels that work for rural, urban, literate, and tech-savvy customers is critical to opening financial inclusion for all. The convenience of access points and knowledge of the “how/what/where’s” of debit cards, ATMs, and digital points of sale (POS) are cornerstones to this eco-system.