Traders say based on past experience, they fear being harrassed by representatives of microfinance banks and informal financial services providers.
Funlola Abdulsamad's first-hand knowledge of how women entrepreneurs could access financial support and other services came in the form of a humiliating episode at Odo Ori market in Iwo, Osun State, in 2017.
A trader who allegedly defaulted in the payment of her microsavings loan was forced to dance around the market with plastic and other filthy materials hung around her neck. The woman, Ms Abdulsamad told PREMIUM TIMES, was thereafter taken to Feesu bus terminus and other strategic parts of Iwo town by officials of the microfinance bank that lent her money.
"It was a most embarrassing and terrifying moment for even me," Ms Abdulsamad said of the memorable occasion in an interview with this newspaper, her voice a mélange of fear and irritation.
"Although it didn't happen to me, I thought about it and concluded that I was never going to be a part of any such [financial services] support system. I can't imagine going through such humiliation. It was very embarrassing."
Ms Abdulsamad sells fruits and other agricultural produce at Oluwo Market on the outskirts of Iwo town. Everyday, she displays her produce on the edges of the Ibadan-Osogbo Expressway. With an entire stock valued at less than N10,000. She admitted that she could expand her business and rent a shop if she received the right financial support. But despite her financial challenges, she vowed never to seek support from the numerous organisations offering microsavings and other financial products and services to women entrepreneurs and traders in and around Iwo town.
"They have no respect for privacy," she said. "They can humiliate you anywhere at any time. They don't care if you really don't want other people to know about your businesses or financial status and challenges."
Adijatu Kareem, a trader at Odo Ori market in Iwo, told PREMIUM TIMES how "public" the application process could be for prospective loan applicants, thus exposing them to the "prying eyes of the entire market." Mrs Kareem, who resides in Papa, a village on the outskirts of Iwo, explained that in their efforts to conduct due diligence, officials of financial service providers often expose applicants' data and pay less attention to privacy.
"Before you have access to a loan or open an account, they will have to conduct an 'inspection' on your shop or kiosk," she began. "That way, they take pictures and do a valuation of your goods. They do this publicly and it attracts the attention of everyone in the market to your shop. Many of us don't like this at all."
The trader added that many women in the market have chosen not to be part of any formal credit service because of this privacy concern.
Financial Inclusion
In October 2012, Nigeria launched its National Financial Inclusion Strategy with the overall target of reducing the adult financial exclusion rate from 46.3% in 2010 to 20% by 2020. Central to these goals are a strong network of financial access points such as commercial bank branches, microfinance bank branches, Automated Teller Machines (ATMs), Point-of-ofSales (POS) terminals, agent banking outlets and mobile money agents.
In January 2019, the strategy was modified and it identified five of the most excluded demographics: women; youth; micro, small and medium enterprises (MSMEs); rural dwellers; and individuals living in the country's northern regions.
At the heart of conversations around financial inclusion are issues of women entrepreneurship and access to and use of financial products and services in relation to how they affect job creation, economic growth and women empowerment.
According to a 2018 survey by Enhancing Financial Innovation and Access (EFInA), financial inclusion nationwide stood at 59.1 percent for women compared with 67.5 percent for men, a gender gap of 8.4 percent. Although this represented a slight improvement from a gap of 9.8 percent recorded in 2016, it was still considered poor.
Working in collaboration with its Financial Inclusion Secretariat (FIS), the Central Bank of Nigeria has designed policies and partnership programmes targeted at women. Examples of such initiatives is the establishment of the MSME Development Fund (MSMEDF), a NGN220 billion (approximately USD 717 million) intervention fund set up by CBN that takes into consideration the unique challenges faced by women in accessing credit with 60 percent of funds (NGN132 billion, or roughly USD 430 million) earmarked for women. There is also the National Financial Inclusion Special Interventions Working Group (NFISIWG).
Women Still Vulnerable
Despite the various interventions by government and other stakeholders in the private sector, women are still largely excluded from the financial service ecosystem. Over 1 billion women still do not use or have access to the financial system, according to the World Bank Group's Global Findex report.
The International Finance Corporation (IFC) has estimated that globally, a $300 billion gap in financing exists for formal, women-owned small businesses, and more than 70 percent of women-owned small and medium enterprises have inadequate or no access to financial services.
Iya Sodiki, a trader at Ile-Ogbo community in Ayedire Local Government Area of Osun State, told this newspaper that she does not own any bank account nor does she know of anyone around her who owns an account. According to her, access to financial services can be cumbersome and tedious, hence their nonchalant attitude to financial inclusion.
Multiple interviews with women across markets in Iwo and adjoining villages like Papa showed that many of the traders save their money with thrift collectors and others who run infromal contribution schemes. Others who handle fewer cash, including those with relatively low rate of daily turnover, often resort to keeping their money at home.
According to a report by the Rockefeller Philanthropy Advisor's Gender Centre of Excellence, about 98 per cent of Nigerian women are left out of formal credit markets, unable to obtain loans from formal financial institutions like banks.
The centre, established to be a knowledge hub on advancing women's financial inclusion in Nigeria, added that only about 45 per cent of adult Nigerians borrow at all from the formal sector.
Data Privacy
The challenges notwithstanding, the digital financial services market is being transformed at an exponentially fast rate, and it has helped in meeting financial inclusion goals and their poverty alleviation and economic growth benefits. But there has equally been concern with regard to data privacy issues especially in relation to vulnerable groups such as women, youth, the elderly, persons with disabilities and displaced persons.
Folasade Badmus, a trader at Oja Ale market, Iwo, told PREMIUM TIMES that she once attempted to open an account with a microfinance bank but shelved the idea after officials of the company showed up in her shop unannounced.
"They said they came for 'inspection' and 'mobilisation', and then they wanted to take pictures of my kiosk," she said, half-amused. "Just like that?"
"They didn't even inform me ahead of time. When they came, everybody's attention shifted to my shop; I didn't like that at all. So, I opted out."
According to a guideline prepared by the Alliance for Financial Inclusion (AFI), cultural norms in some societies may mean women are especially concerned about the privacy of their data, including as far as other household members (such as their partners) and their communities are concerned.
Mama Glory, a fruit seller at Oluwo market, said she chose to shut herself away from financial service companies because of her "peace of mind" and "integrity" in the market. According to her, she doesn't worry about being humiliated however poor her daily sales records are.
"Women in our community value their self-esteem but many of them are just helpless; that's why they go for these loans and services despite the disgrace," she said.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
A study conducted by the Digital Financial Service (DFS) Working Group noted that low-income customers value data privacy, were prepared to spend time in obtaining a loan that offers privacy, and were unwilling to share personal data with third parties.
But a loan service officer at LAPO Microfinance Bank, who declined to have her name in print because she was not authorized to speak to the press, told PREMIUM TIMES those financial institutions also value issues of data privacy. However, she said, officials are sometimes compelled to adopt certain "open" strategies due to the "recalcitrant attitude" of some of the female beneficiaries.
"We conduct inspections and go unannounced because most of the women can be crafty," she said.
"They can arrange goods that are not theirs in their shops once they know you are coming for inspection. We also take pictures so that we can keep records of their valuables. These things are inevitable."
Due to poor access to financial services, women face difficulties in collecting and saving income, growing their businesses, and pulling their families out of poverty.
The Rockefeller Philanthropy Advisor's Gender Centre of Excellence report said that low education, limited decision-making power, and being in a rural area exacerbate these issues. It also exposes women to financial limitations and, by implication, deepens poverty.
Tunde Bamishe, a finance analyst, told this newspaper that there could be moderation in the conduct of loan service providers with regard to data privacy. According to him, due diligence could be conducted discreetly in ways that it won't discourage other women from being part of the financial ecosystem.
"The goal is to support their businesses and deepen financial inclusion," he said.
"Stakeholders especially in rural areas must be sensitive to the cultural dynamics and ensure that data privacy guidelines are adhered to, in order to encourage them to adopt financial services."
