The gender gap in financial inclusion has been stubborn for decades with women worldwide mostly suffering the brunt of its effects.
Between 2011 and 2017, there was hope after the world saw strong progress which brought 1.2 billion people into the global financial system for the first time.
But, the gap between the proportion of men and women who had an account with a financial institution in low and middle income markets stayed stuck at nine percentage points.
The latest research launched by Caribou Digital with support from the Bill & Melinda Gates Foundation found that women's financial exclusion is driven by structural-cultural and socio-economic issues.
The study titled, Payments System Design and the Financial Inclusion Gender Gap looked at how payment system design specifically, and the Level One Project principles (L1P) could impact gender bias in Digital Financial Services (DFS).
The study was conducted in Kenya, Nigeria, South Africa, Cote d'Ivoire and Bangladesh and is likely the first cross-platform, cross-network analysis of gender difference in actual financial activity in the Global South.
Norms and biases
The research sought to find out why despite the reduction of financial inclusion barriers, many women still remain outside the formal financial system.
It also sought to know what barriers exclude women in greater numbers than men be it culture or institutions or a failure on the part of financial providers to design products that interest them.
Cultural norms and biases the research found out can impact access to and usage of digital financial services, particularly for women.
The report also notes that adoption of a Level One Project principles (L1P system) has positive benefits for women relative to the typical digital payments system.
"Our research emphasises that women's exclusion is driven by structural, cultural and socio-economic issues. Such issues include the fact that many societies invest less in building women's knowledge and trust of financial products," the report says in part.
The research findings also observe the fact that women are more often budget and time constrained than men makes them more sensitive to cost and time barriers.
It also reveals that women face more specific structural barriers, like owning lower-end phones or lacking necessary identity card documents.
Legal and policy barriers are also named as another key set back that many laws persist that discriminate against women and indirectly or directly contribute to the financial inclusion gender gap and which impact DFS access and usage for women.
Mobile device ownership gaps is another major challenge with mobile devices being critical for DFS to flourish and women being less likely than men to own them.
The report indicates more than 390 million women in low- and middle-income countries remain unconnected, and 165 million fewer women than men own mobile devices.
"When they do have a phone, they are more likely to have a basic or feature phone, while men more often have smartphones," the report says.
Socio-economic realities is another major undoing with the report indicating that women are more likely to be poor, experience pay gaps, be out of the workforce or participate in the informal sector, all factors that make it harder to access or adopt digital financial services.
Huge gender gap in DFS literacy, broader digital familiarity and education which include reading, writing and numeracy, digital/ technical familiarity, and financial literacy have also been named as barriers to DFS access and use that affect women disproportionately.
To help address these barriers, the research findings proposes that better payment system design features and policies are put in place.
Additionally, the report has recommended some modifications to some of the principles to increase their impact in closing the gender gap.
These include those that address irrevocability, account identifiers and directories, pricing transparency, user experience and consumer education.
In Kenyan FGDs, women reported valuing the convenience of engaging different mobile money use cases for bill and merchant.
In Kenya, female respondents who participated in the survey said that they had less time and sometimes less knowledge, to deal with revoking payments when making mistakes.
Existing methods to cancel or reverse erroneous mobile money transactions were mentioned by respondents as having a more positive impact on women.
In Côte d'Ivoire, female respondents voiced greater concerns over network issues and worries that transactions were not being completed, contributing to their lower levels of trust in digital finance overall.
Some of the female respondents here said they were particularly nervous about making mistakes and preferred USSD and keypad phones rather than touch-screen keypads, which they viewed as more prone to errors.
Some female small business owners said they feared being defrauded by customers who would buy something and then revoke the payment after they left with the goods.
The report covers several key insights into DFS activities from looking at how gender differences are lower at higher socioeconomic to data showing how women are still excluded in multiple ways in accessing advanced DFS products and Unstructured Supplementary Service Data (USSD) still being a dominant feature with 90 per cent of transactions are still being made via USSD or SIM toolkit and women are two to five times as likely as men to rely on USSD.