AFI’s PPD on COVID-19 highlights gender concerns

“Women who work in informal sectors are most at risk of being left behind which is why we need gender-sensitive and targeted interventions in formulating policies to address the COVID-19 pandemic,” Dr. Monique Nsanzabaganwa, Deputy Governor of the National Bank of Rwanda said during the 1st Virtual AFI Public-Private Dialogue (PPD) Meeting.

By addressing solutions that build resilience among micro, small and medium size enterprises (MSMEs) amid the short- and medium-term impacts of COVID-19, the meeting offered practical gender sensitive solutions while providing a platform for collaboration between public and private sector from a global perspective distilled to country level.

“Women tend to fall between the cracks where information dissemination is concerned. This, coupled with their low level of financial literacy, puts women-owned MSMEs at a disadvantage, especially at times of crisis.” Dr. Nsanzabaganwa told close to 150 participants during a ‘Meeting the Impact of COVID-19: Implications and Response Measures for MSMEs” on 23 April 2020 organized exclusively for AFI members and select PPD partners.

“Now, more than ever, there is a need to collaborate and invest in women,” Dr. Nsanzabaganwa emphasised.

Nevertheless, access to information and lack in financial literacy among women-owned MSMEs are not new issues.

“Even before the crisis, women are already disadvantaged where access in concerned. This is further exacerbated in times of crisis,” said Amina Tirana from Visa, underscoring the need for both pre-existing conditions and long-term goals to be considered in gender inclusive finance strategies.

“There is enormous political will to help women now amidst the COVID-19 outbreak,” she said adding that “We need to harness this to ‘leap-frog’ policies that makes things better for women.”

Giving Mexico as an example, Tirana explained that two years after the country introduced its tiered Know-Your-Customer (KYC) program in 2011, the number of bank accounts increased by 14 percent or 9.1 million. Of the newly opened accounts, 77 percent of them were attributed to simplified due diligence.

Financial regulators need to consider how to incorporate diversity into their strategies, promote the use of e-commerce, as well as focus on how to establish formal relationships with women-led informal and quasi-formal microenterprises, Tirana concluded

Killan Clifford from GSMA echoed this sentiment and shared that women make up the largest number of informal MSMEs, especially in developing economies.

“Many women-owned enterprises do not have access to formal financial services,” said Clifford, “Instead, in many parts of the world, they use their personal mobile money devices for their business transactions.”

For this reason, initiatives such as temporary increase in transaction limits and reduction of transaction fees during the COVID-19 pandemic, like those being done by the Central Bank of Liberia, the Central Bank of Lesotho, the National Bank of Rwanda and the Bank of Uganda have an amplifying impact on women.

“In these challenging times, we need to ask ourselves how we can make life easier for users of digital technology and especially women,” added Christopher Harrall from Mastercard. He also emphasized the need for practical innovation in using digital technology, illustrating how Mastercard had previously partnered with the Egyptian government to disburse alimony payment via mobile money, benefiting over 60,000 Egyptian women and their children.

“In Egypt, the National Council for Women established the women’s policy tracker on responsive policies and programs during the Covid-19 pandemic,” shared Perihan Hegazy from the Central Bank of Egypt.

The tracker monitors the responsiveness of policies and procedures to the needs of Egyptian women in light of the efforts made to reduce the spread of the virus. Among important components captured by the tracker are the impact on human endowment (health, education and social protection), women’s voice and agency (including addressing violence against women and women’s leadership and representation), the impact on economic opportunities for women, as well as the promotion of data and knowledge.

In addition, loan instalments for MSMEs have been momentarily deferred. “This is important as 80 percent of microfinance businesses are women-owned,” explains Hegazy, “And it is much needed for reducing the gender gap especially in the current challenging time.”

AFI’s Gender Inclusive Finance workstream is partially financed by the Swedish International Development Cooperation Agency (Sida) and other partners.