Historically, women in emerging economies have been at a disadvantage when it comes to accessing financial services. Barriers to access typically include the absence of banks in rural areas, the duty of caring for family and other work responsibilities or a lack of the appropriate documentation required to become part of the financial fabric of society.

Despite notable advancements to drive inclusion, women are still less likely than men to own an account at a financial institution and more likely to be financially excluded, according to the 2017 Global Findex database by the World Bank. This is especially pronounced in Asian countries like India, Bangladesh and Pakistan, where the gap between men and women owning an account is nearly 30 per cent.

In South-east Asia, the actual population of unbanked women is difficult to identify. We do know, however, that women in emerging Asian economies are more likely to be engaged in informal employment and remunerated in cash.

If they were working in formal, recognised employment, they would automatically be incorporated into a banking network to have their wages paid. Unfortunately, working in informal sectors means their wages are nominal and paid often, meaning there is rarely any surplus to set aside to pay the upfront fees required to open a bank account, let alone any credit history

There is also the challenge of societal norms. Many countries in emerging Asia are still deeply patriarchal, with women being largely responsible for household and other familial chores. If they are principally confined to the home, then women are less likely to be exposed to or to absorb information on banking or financial planning than their male counterparts.

Patriarchal structures often mean that South-east Asian women’s discretionary income is limited, so they are also constrained when it comes to the purchase of what are now considered everyday items: mobile phones. An estimated 1.2 billion women in low- and middle-income countries still do not enjoy access to the mobile Internet, and therefore remain oblivious to a wealth of information. GSMA estimates that women in low- and middle-income countries are “on average 10 per cent less likely to own a mobile phone than men”. This therefore creates a digital gender gap, with women being unable to reap the benefits of accessing mobile financial services and information.

Role of tech in bridging the gap

Fortunately in some South-east Asian countries, there’s been a recent, marked uptick in the number of women opening bank accounts.

In the Philippines, the Social Institutions & Gender Index has found that women make up more than half (56 per cent) of bank account holders; in Indonesia, the World Bank reported that bank account ownership by women climbed from 20 to 50 per cent between 2011 and 2017.

One of the main drivers of this shift is that financial inclusion is a high priority for the current administrations in both countries, along with support for innovation in technology to make financial services more accessible. Laws in Indonesia, for instance, mandate that women have equal access to financial services including bank loans and credit, and possess the right to independently conclude contracts. Closer to home, the Singapore government’s decision to award five new digital bank licences is a landmark move that could benefit niche segments of the market such as foreign workers and SMEs.

Innovation in financial technology, or fintech, as a harbinger of change can consequently help close the gender gap in financial inclusion. For example, distinct gender preferences were noted in Singapore around the uptake of robo-advisory products and services in wealth management: women with assets of less than S$60,000 with average retail investment experience were more likely to consider investing with robo-advisers.

Achieving parity: Where to from here?

As the Women’s World Banking holds its summit titled “Making Finance Work for Women” in Singapore this week, closing the gender gap in financial inclusion in emerging Asia is certainly brought into focus.

Fintech providers can’t go at it alone. But, because we are at the forefront of rising innovation, we are well positioned to help underserved communities, including unbanked and underbanked women across the region.

Platforms created by Oriente, such as Cashalo in the Philippines and Finmas in Indonesia, are not only helping to empower women in creating financial identities and accessing credit; they are also driving active participation in the formal economy. For instance, in the Philippines, a majority of the over two million Cashalo users are young working women looking to build a better life for their families and are using digital credit through the platform to buy household goods, or other items to grow their small businesses.

Meanwhile, governments play a critical role in fostering innovation in financial technology and enabling a dynamic ecosystem in which digital financial solutions that specifically cater to underserved communities can flourish. It is only with a multi-faceted, collaborative approach that the vision of a financially fair and inclusive future for South-east Asian women will be realised. It’s about time.

This opinion was published in The Business Times on 22 October 2019.