Global statistics show that one-third of the world’s population is financially illiterate. Of these individuals, women in impoverished countries make up a disproportionate percentage. As financial illiteracy is directly correlated with income levels, it is no surprise that women are also disproportionally living in poverty. The pandemic is further widening this gender poverty gap and earlier this year, FINCA projected that 120,000 of its women-owned small and micro-business clients will be financially devastated by the effects of COVID-19.
As the pandemic continues to impact the global economy, the need for women’s financial literacy in impoverished countries is intensifying and is critical in the effort to stop the reversal of decades of progress toward international poverty reduction.
Effective Financial Literacy Improves Financial Wellbeing
FINCA is focused on supporting the financial inclusion of women everywhere it operates. This includes everything from micro-loans and business advice to financial literacy training and tools to improve financial wellbeing. FINCA recognizes the importance of bringing financial literacy to women, helping them increase their standards of living and education while enhancing economic prosperity.
Improved advocacy for increased financial literacy is key to relieving the economic strain in many impoverished countries as it helps remove a critical barrier to financial inclusion. This also paves the way for improved risk management, increased customer usage of financial services, and empowers both men and women to gain better control of their savings. Over the past year, it has become clear that financial literacy education is a critical tool in the age of COVID-19 and ever-looming natural disasters.
Enhanced Financial Inclusion Helps Close the Gender Gap
Deeply rooted social norms coupled with gender biases have fueled the financial hardships women face today. This has made it difficult for women to achieve financial independence, which is crucial to their personal and entrepreneurial success. That’s why FINCA takes women’s financial inclusion seriously.
As an example, FINCA launched in 2017 the Financial Inclusion Project supported by the Government of Canada. This five-year partnership is designed to promote economic prosperity for low-income women and men in Haiti and the Democratic Republic of the Congo (DRC).
At the conclusion of the fourth year of the project, FINCA Haiti has cumulatively provided financial literacy training to 76,290 Village Banking clients, 92 percent of whom are women. In the DRC, FINCA has provided financial literacy training to 140,482 clients, more than half of whom are women. By providing women entrepreneurs with equal opportunities, knowledge and finances, FINCA has significantly contributed to the improved financial empowerment among women in Haiti and the DRC.
Globally, 4.5 million women in developing countries have partnered with the FINCA network, receiving appropriate financial education to better navigate the evolving financial landscape and lift themselves out of extreme poverty. Equal access to financial literacy and advancement is the goal, and FINCA is committed to helping clients break down the vicious cycle of inter-generational poverty by promoting economic education and financial inclusion for all.