Challenging assumptions about girls and saving

Those in the asset building and financial inclusion fields have long noted the potential benefits that building savings or growing assets—even small amounts—can have for economically vulnerable individuals. Experts contend that females, in particular, whose access to education, health, or even nutrition is more tenuous than their male counterparts’, stand to significantly benefit from having savings that can be used for personal, educational, or emergency expenses. One question of interest in the YouthSave initiative was whether gender-based inequities would present barriers to saving by girls. Conversely, would removal of barriers to youth savings and barriers specific to girls foment account uptake? If so, how much would girls save compared to boys?

The good news is that girls involved in the YouthSave project opened savings accounts when access barriers were removed. Moreover, these girls saved as much as or more than boys.

The four participating YouthSave countries differ in the number of accounts opened by gender. In Colombia, a nearly equal number of girls and boys opened accounts, and in Ghana, more girls than boys opened accounts. In Kenya and Nepal, on the other hand, more boys opened accounts than girls, by a ratio of 3 to 2. Interestingly, the ratio becomes increasingly disproportionate when youth can open accounts independently. In Nepal, for example, the ratio of boys to girls increases to 3 to 1 for those who were at the age of majority when they opened their account. We believe that country context and cultural norms help explain some of the gender patterns in account uptake. In the context of the four YouthSave countries, Colombia has the lowest gender inequality index, and Kenya has the highest gender inequality index (UNDP, 2013). And in Nepal, where cultural and religious norms restrict the autonomy and mobility of girls in public spaces, our findings seem to support, at least in part, the idea that uptake is affected by these norms.

YouthSave also found that an important factor in achieving account opening is the banks’ outreach efforts at schools. Although our project did not create account opening targets based on gender, YouthSave financial institution (FI) partners were conscious of potential disparities. In countries where girls and women have limited autonomy and/or mobility, FI outreach to places where girls already were, which removed the challenge for girls of getting to the bank, provided a greater opportunity for their participation in saving at a financial institution. First, outreach provided information to girls about saving through a bank account, which they may not have otherwise obtained, and, second, it offered opportunities to open accounts at the schools themselves.

Particularly notable are the savings amounts by gender across the countries. Based on average monthly net savings, girls saved as much as boys across all four countries, pointing to the fact that overcoming access barriers is of critical importance. Surprisingly, given the disparate uptake rate, in Nepal girls saved significantly more than boys. Part of the reason may lie in transaction patterns. Boys, especially older boys, tend to withdraw more than girls. In fact, although boys and girls both report they are saving for their own education, boys more often than girls indicate saving for emergencies, day-to-day expenses, or business expenses. Boys may have greater pressure to provide financial support for family expenses and to become self-sufficient earlier. Girls, on the other hand, might be motivated to amass their savings, as they are often less likely to enter or complete higher education, sometimes because limited family resources are spent on the education of male siblings. For girls, then, savings may increase educational and future employment opportunities, which may serve as a motivating factor. Alternatively, lack of mobility or autonomy in some contexts may limit withdrawal opportunities for girls, yet have the benefit of retaining savings in the account.

These findings suggest that access to financial institutions for girls may be a bigger barrier to financial participation than saving itself; that is, focus should be on facilitating easier and safer ways to open accounts and make deposits, provided girls who may lack autonomy or mobility have relatively easy ways to access and withdraw money when needed. This study shows that girls can and will save as much as boys. YouthSave increased the opportunity to do so by “taking the bank to the youth.” Financial institution partnerships with schools or youth-serving organizations is one solution for advancing gender equity in financial inclusion.

References

Demirguc-Kunt, A., Klapper, L., & Singer, D. (2013). Financial inclusion and legal discrimination Against women: Evidence from developing countries. Policy Research Working Paper. World Bank: Washington, DC.

United Nations Development Programme. (2013). Human development report 2013. Retrieved from http://hdr.undp.org/en/media/HDR2013_EN_Statistics.pdf

This post originally appeared in New America’s digital magazine,The Weekly Wonk. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Lissa Johnson is a contributor for NewAmerica.org. 

Image: Girls stand inside their classroom at a primary school. REUTERS/Thomas Mukoya.