“Women belong in all places where decisions are being made.” – Ruth Bader Ginsburg

Covid-19 brought our world to a halt. Life as we knew it was changed and what was meant for to be a month long lockdown became a two-year-long lockdown in many countries. While everyone took their time to adjust to the new life, the worst hit were poor people.

A Findex survey found that 1.4 billion people worldwide had no access to banking facilities and given that 91% of Pakistanis are unbanked it clearly makes it more difficult for people in the lower-income bracket to save, borrow, receive and send money, or even to start a business. The remaining nine percent turned to online means of purchasing groceries, accessing healthcare, entertainment, transferring money, and even socialising in a restricted sense; however, for the vast majority, the experience was quite different. Unable to access financial services online, they were forced to look for shops that broke curfews and remained open despite the government restrictions. Furthermore, people who had bank accounts but were dependent on physical banks faced obstacles as many banks closed their branches.

It is important to recognise that ‘financial inclusion’ represents a whole host of services ranging from day-to-day banking to savings, pensions, credit, and insurance. This is where it becomes imperative that organisations such as those dealing in microfinance, in addition to the many fintechs that are entering the space and development sector players, collaborate to form new solutions. Technology in particular has a huge role to play. For example, Raast in Pakistan is providing person-to-person (P2P) mobile payment services and according to the State Bank of Pakistan (SBP )at the close of FY 2021-22, nearly 15 million registered users carried out transactions worth Rs 100 billion.

In this new world where financial inclusion has become such an important topic, we have to keep an eye on how benefits are spread across genders. According to Jameel Ahmed, Governor, SBP, for every three men who have a bank account, only one woman has access to one. Study after study has proven that financial inclusion plays a role in reducing poverty and improving lives, especially those of poorer women. When a woman opens an account, she uses it to build savings, invest in her children’s education, and invest in long-term business opportunities. It puts her on the path to greater security, privacy and agency over her finances.

Financial inclusion can be seen at three levels: women entrepreneurs in fintech, women professionals at fintechs or other financial institutions, and the female user base. Taking it in the most basic sense, financial inclusion means that women have a safe space to keep their money; it is transferred electronically or through bank checks into an account which frees them from the risks associated with carrying large wads of cash that can be snatched or, as per usual, taken by the male heads of their families.

It also means being able to transfer money to their families if they relocate to rural areas, or even to other countries, for employment. This also benefits them by creating a credit history with merchants and suppliers that accept electronic transfers thus making it easier to access short or long-term working loans.

According to the SBP, as of December 2022, only 18% of Pakistani women have bank accounts compared to 51% of men. Gender-intentional strategies and products can deal with this glaring disparity. Fintechs have a large role to play here to bring more women into the banking net. We have seen certain initiatives in this space in the last few years.

S&P’s Global Market Intelligence Quantamental Research Team published what is considered the most comprehensive study of its kind called When Women Lead, Firms Win. It looked at the performance of firms that hired female CEOs and CFOs. It was found that in just 24 months, female CEOs saw a growth of 20% in the stock market. Similarly, female CFOs were able to increase profitability and receive an eight percent growth in stock returns.

Women entrepreneurs are slowly coming into the fintech space. Tez Financial is the first Pakistani company to receive the Non-banking Financial Company (NBFC) certificate in 2018, just a year after it was founded. Naureen Hyat, CEO, Tez Financial, was inspired by her work with microfinance institutes while she served as a financial analyst at Pakistan Credit Rating Agency (PACRA). She noticed that a large portion of applicants for microfinance was turned away as they had no credit scores. The Harvard graduate co-founded Tez Financial, a fintech company that provides nano loans to the unbanked masses ignored by conventional banks. This demographic is also not catered to by microfinance institutions as they do not have a credit score. Tez takes smartphone data, consumption patterns and social behaviour of applicants and uses it to find the best product fit for their needs. The company was acquired in May 2022 by ZoodPay, a Switzerland-based buy-now-pay-later company.

Oraan is another company founded by women. Positioned as Pakistan’s first gender-inclusive fintech, the company works on the Rotating Savings and Credit Association (ROSCA) model. The CEO, Halima Iqbal, noticed that a large number of women around her used ROSCA or what is commonly referred to as ‘committees’ to save up for important events such as weddings, home renovations and even for smaller investments like buying household appliances like a refrigerator or a washing machine. Using the model, Halima and co-founder Farwa Tapal, launched Oraan which focuses on products related to savings, insurance and savings. Currently, the company has over 10,000 users utilising the committee-based product and 84% are women. The company received three million dollars in seed funding in September 2021 from Zayn Capital and Wavemaker Partners.

Metric is another fintech co-founded by a woman. Meenah Tariq, a Babson graduate, worked with start-ups in various roles over the years and realised how getting a bank account for a small business was almost impossible, and services such as online banking or business debit/credit cards were a far-off dream.

This translated to businesses having a low ceiling when it came to growth because not only access to finance but also the spending of their own money was complex and difficult. Metric helps businesses track their own finances and aims to facilitate micro-entrepreneurs to open business bank accounts through the app, and access financial products. Unfortunately, although Metric was designed with businesswomen in mind, the percentage of users that identify as women is only 20%. This is because women business owners tend to shy away from handling their business finances (this is much less personal finances). This results in a much higher percentage of women either losing their businesses or being exploited. At Metric, Tariq’s team is now revisiting all communication and campaigns to directly be able to speak to women and inspire them to reimagine their relationship with their own businesses.

Not only are women now entering the fintech space as founders, but many established companies are now seeing the potential in acquiring a gender-inclusive approach especially as competition becomes fiercer and the conventional user base is now reaching saturation. The OneLoad Women Empowerment Program, for instance, is making its app OneLoad more appealing to women retailers by offering special incentives, full-time support with troubleshooting and credit serving, and trained salespersons offering handholding to help them ease into using the app. The financial aggregator, which received a catalyst grant from Bill and Melinda Gates Foundation, has already grown to over 1000 active female retailers with 150,000 customers served and a throughput of Rs. 129 million.

We are seeing an increasing number of women not only starting fintech companies but also serving on fintech boards. While Oraan, Tez Financial (now acquired by ZoodPay), and Metrics have female CEOs, others are increasingly becoming aware of the need for female representation on their boards. The Central Depository Company is one example with two Pakistani tech stalwarts, Jehan Ara and Ammara Masood, on their board. Pakistan Stock Exchange also has a female Chairperson, Shamshad Akhtar, and a female General Manager, Raeda Latif. With an increasingly more gender-conscious environment, Pakistan’s glaring gender disparity among the banked population and the divide between the banked and unbanked should show significant improvement over the coming years.

Maria Umar is a gender inclusion and women economic empowerment specialist. She is the founder and president of Women’s Digital League. maria.umer@epsystems.pk