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World Bank to consider impact of lacking ID on digital financial inclusion for women

World Bank to consider impact of lacking ID on digital financial inclusion for women

A blog post by the World Bank shares that an upcoming World Bank paper will recommend ways to close the gender access gap to digital financial services.

Limited financial literacy, a lack of identity documents, and cultural constraints are major barriers for women in accessing financial products, World Bank research indicates. Additionally, low digital literacy, smartphones, and lack of internet access limit their ability to take advantage of the expanding landscape of digital financial tools.

A lack of supply-side data on gender disparities as well as products and services designed without addressing the unique needs of women also stifles access. Discriminatory laws and regulations as well as limited rights reinforce these hurdles.

On average, women have 77 percent of the legal rights men do around the world. Even more concerning is that in 2022, reforms toward legal gender equality reached a 20 year low.

One step in overcoming challenges to digital financial inclusion for women is to create gender-relevant regulatory frameworks and policies. Tiered customer due diligence regulations for risk assessment, recognizing more identity documents, and incorporating a vulnerability lens to address negative experiences women have with digital financial services are some critical steps to bridge the access gap.

Mexico’s tiered account-opening requirements serves as an example of a gender-relevant policy approach that bridges this gap. Another example of addressing the gap is Bank Negara Malaysia’s commitment to gathering gender disaggregated data, which will inform interventions and educational opportunities.

Digital literacy initiatives such as Indonesia’s women digital ambassadors provide branch agnostic financial services mentorship. Pakistan’s Asaan Mobile Account, which includes a digital wallet, is an example of bridging the internet connectivity access gap.

Lastly, regulators should create infrastructure that includes interoperable digital identity systems as well as identity reform to make obtaining IDs simpler for women.

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