Women are an underserved market for mobile financial services
Women in developing countries represent a significant underserved market and commercial opportunity for mobile financial service providers, according to a new study from the GSMA and Visa.
Around the world more than two billion people, the majority of whom are women, lack access to basic financial services, the new study has shown. Women often also face an additional burden of having primary responsibility for managing the household finances. These resource-poor women must overcome numerous challenges in managing their finances: incomes are low, irregular and unpredictable, and formal financial tools hard to access, said the GSMA.
The research showed that women use a variety of tools to manage household finances, with nearly 60% of women surveyed saving money for daily expenses and long term needs, and one third paying the family's utility bills or making other types of remittances. Also, women recognise the security and privacy of mobile money; in Kenya, for example, 95% of women using mobile remittances rated them as secure and private. In comparison, only roughly half of those using personal delivery of cash as their primary method consider it secure and private.
'At Visa, we believe mobile technology is a key component in advancing financial inclusion, providing the excluded a convenient and accessible point of entry to the formal financial system,' said Aletha Ling, chief operating officer at Fundamo, a Visa company. 'This is particularly true for women, who face additional barriers to entering the financial mainstream and for whom security and privacy are critical issues. By working to build relevant services, expand distribution networks and tailor their marketing efforts, the mobile financial services community can create better approaches for reaching this underserved group.'
According to the report, women are active contributors to household incomes, and as household financial managers, they are responsible for a variety of transactions such as remittances, payments and money storage that mobile financial service (MFS) providers are well-positioned to deliver. As an additional commercial benefit to MFS providers, when women's financial and payment needs are met consistently, they can be very loyal and evangelising customers. Furthermore, their role as primary recipients of government-to-person payments means that providers who serve women may be better positioned to provide solutions for the emerging wave of payments in the future.
To better serve low-income women, reduce the mobile phone gender-gap and increase the likelihood of commercial success for mobile financial service deployments in emerging markets, the report recommends an increase in mobile access for women; 34% of women in Tanzania, 13% of women in Kenya and 10% of women in Papua New Guinea who want to try mobile financial services cite the lack of a phone as the main reason for not having done so. Closing this gender gap can help MFS providers build scale and volume for their mobile financial service businesses.
The report also recommends that providers need to research how women in their markets learn and absorb information and tailor their communications appropriately. It also noted that women tend to value convenience, reliability, security and privacy in financial management tools so investments in marketing, services, plus customer care and agent networks will enable providers to better meet these needs.
Finally the report said country-specific adoption barriers need to be addressed with targeted solutions. For example, in Kenya, the lack of an identification card is a significant issue for women. In Pakistan, low literacy levels appear to contribute to women's limited understanding of mobile financial services. Country-specific research will lead to targeted marketing approaches that can broaden the potential user base for MFS.
The study, called Unlocking the Potential: Women and Mobile Financial Services in Emerging Markets, by the GSMA mWomen Programme and Visa, focused on women in Indonesia, Kenya, Pakistan, Papua New Guinea and Tanzania.