Cultural practices have put the woman and girl-child at an economic disadvantage in many societies across the world. Their place is relegated to menial, low-paid and subsistence activities that are often uncounted in national statistics. Even in modern times, these trends have not changed and are now entrenched in the way resources are being allocated and opportunities presented in the society. As we celebrate this year’s International Day of Women, it has become pertinent to highlight the disadvantages faced by women in accessing financial services in Nigeria.
Women are often seen as the weaker sex, yet in many communities in Nigeria, they put in more hours of work than men. They are expected to perform both reproductive and productive functions within the family, and are often unpaid. Women living in poverty (and majority of Nigerian women belong to this category) are disproportionally affected by these responsibilities. In Nigeria, where successive governments have failed to provide basic amenities and public services are lacking in our local and peri-urban areas, women rely on their labour to provide the needed care and still earn income through subsistence farming, petty trading or hawking. They must achieve this and again still perform the reproductive and maternal functions within the household. According to a recent study conducted by ActionAid, poor women in rural and urban areas work longer hours than men, spend more time on unpaid care work and subsistence agriculture, and have less time to engage in paid work and social and cultural activities. This is a breach of their fundamental human rights. Despite this amount of time women put into work, they earn little, own no assets and have no forms of security to handle social shocks. This situation is both for rural and urban communities in Nigeria.
Access to financial service is one of the areas where women face the greatest discrimination as financial service providers have failed to understand the salient lifecycle needs of women in the design and delivery of their products and services. There is a generally accepted correlation between gender inequality and low economic indices, and for Nigeria to improve the livelihoods of its people, greater attention must be placed on gender relations. Access to finance enables women to invest and acquire assets for increased economic activity. As a result of this economic empowerment, women can increase household wellbeing, including men and children (through improved nutrition, health, literacy and happiness). Increase in economic activities and increased decision-making by women lead to a wider social and political empowerment. This can be seen in improved confidence, skills, network and mobility as well as power to challenge and change gender relations. All these improve women’s human rights, general poverty reduction and national economic growth.
At the micro level, because women are more averse to risks, have time constraints (due to other household responsibilities) and are often inexperienced with large-scale income generation, financial service providers should design their products by offering small loans so that women can invest in small assets or in income-generating activities that yield quick returns. Loans to women must be targeted at productive activities while collateral requirements must be relaxed to include social collateral and women’s property such as jewellery and utensils. To instil financial discipline, repayments must be more regular (daily or weekly) and be as soon as loan is disbursed. Savings programmes should also be designed to increase thrift and financial management, risk mitigation and assets building. All financial service should be group-based and made accessible to women and they should be located where women frequent. Group-based delivery reduces cost and increases social cohesion. Financial service providers should lace their product offering with insurance products that mitigate the risk that women face in their lifecycle, especially health and other risks associated with loans.
The British Council in a recent report on gender in Nigeria stated that despite its size, Nigeria has the lowest rate of female entrepreneurs in sub-Saharan Africa due mainly to inability to scale up from casual, low-skilled, low-paid informal businesses. Their inability to scale up is attributed to limited access to credit, and with only 7.2 percent of them owning land, this access is far from them as they are unable to meet collateral requirements. Yet the Strategic Objective 55 of the Beijing Platform of Action calls for an increase in the productive capacity of women by providing access to capital, resources, credit, etc so as to raise their income and general household wellbeing. Women run only 20 percent of enterprises in the formal sector of Nigeria and without collateral security, they struggle to obtain the needed finance for off-farm activities.
Nigerian financial institutions should, therefore, provide frameworks for the scaling up of women from micro levels to SMEs. This can be achieved though vocational and financial literacy training that must be handled as part of the general service offering to women in such a cost-effective manner to the providers for sustainability.
The Commonwealth Secretariat in London, as part of its Plan of Action for Gender Equality, recently invited leading gender-friendly savings and credit organisations (SACOs) from selected countries to a capacity-building workshop and tour of India, where gender mainstreaming in financial services access was highlighted, knowledge shared and best practices recommended for adoption in member countries. Nigerian financial service providers, regulators and government should learn from success stories in other climes without reinventing the wheel and fast-track this all-important aspect of its economic development.
While the government of Goodluck Jonathan has been praised for its strides in gender matters as depicted by the number and portfolio of women in government, it should introduce policies that make women have equal opportunity to access needed financial resources to increase their businesses. This can be achieved through the provision of incentives (to banks) for priority lending programmes in favour of women businesses, as well as introduction of trade policies and reforms that are not gender neutral. Efforts must be placed in areas where women have demonstrated higher potential for entrepreneurship (such as handcraft and fashion) and linking up women producers and exporters to global markets.