The case for financial inclusion is an indispensable component if women are to achieve economic empowerment.

This is highlighted in the 2020 FINSCOPE report on Gender and Financial Inclusion in Rwanda, which was produced by Access to Finance Rwanda (AFR).

According to the report, financial inclusion—defined as the availability and equality of opportunities to access financial services—should be made priority if women are to be empowered economically.

With financial inclusion, individuals and businesses can access appropriate, affordable, and timely financial products and services. These include banking, loans, equity, and insurance products.

The report shows that 61% of the women in Rwanda are from households that are involved in farming activities.  Farming activities account for 41% of women’s income and 13% from selling something that they grow, the report shows.

Meanwhile, 34% of adult women earn an income from piece work. This makes farming and piece work the leading sources of income for women.

These livelihoods, the report underscores, are often related to irregular and low levels of income and, as such, women generating their income from farming activities are less likely to prioritise the use of financial products or services.

Apart from limitations with income, women are faced with broader societal issues such as cultural norms and belief systems; access to land or property, allocation of intra-household resources and decision-making powers, family responsibilities limiting women’s time, and mobility constraints as challenges affecting women’s levels of financial inclusion.

Overall, 93% of adult Rwandans are financially included, implying that 6.7 million are using either formal or informal products/services to meet their financial needs.

The overall gender gap in financial inclusion has been narrowing, from 4% in 2016 to 1% in 2020, the report states, whereby 92% of adult women are included versus 93% men.

However, women still rely on informal mechanisms as compared to men (80% women versus 76% men).

The Country Director of Access to Finance Rwanda (AFR), Jean Bosco Iyacu, said they have also observed a financial capability/skills and planning gap amongst women as compared to men.

Iyacu appealed that women economic participation and empowerment cannot be achieved without ensuring they access and use quality financial products and services.

"AFR has been and will continue to promote meaningful women financial inclusion and economic participation through the provision of evidence to support policymaking and delivery of adequate financial products and services to women,” Iyacu said.

More factors into play

Financial inclusion is higher in urban areas compared to rural settings yet women in Rwanda mainly reside in rural areas.

The report highlights that women residing in rural areas with no or low levels of formal education, and those who generate an income from piece work or agricultural activities (including those receiving a salary from a farmer) seem to be most vulnerable in terms of financial inclusion and, therefore, should be given priority.

These efforts should go hand in hand with overall poverty alleviation initiatives as they are closely linked.

Financial education has an important role to play in helping women to access and use appropriate formal financial products.

When considering women with no education 87% are financially included, 100% of those with tertiary education have or use financial products or services.

AFR recognises Rwanda’s successful implementation of key policies and strategies such as the National Gender Policy and the Girls’ Education Sector Strategic Plan (2008-12), which have improved girls’ enrolment, retention and completion and in the long-term might have positive effects on women’s economic participation in terms of employment and income generation, this has a strong relationship with financial inclusion.

Iyacu said, "AFR will continue to build capacity of Financial Services Providers (FSPs) to be able to deliver women centric financial products as well as promote women capabilities through financial education and planning.”

When considering women’s overall attitudes and mind-sets about finances, awareness of financial products is fairly low at an average of 43% women, compared to 47% men.

Last year, 8% (a decrease from 14% in 2016) of the female adult population in Rwanda were financially excluded (compared to 7% men), meaning that they manage their financial lives without the use of any financial products or mechanisms external to their personal relationships.

To ensure more women are financially included, AFR has moved to invest in understanding the social and cultural norms that hinder full economic participation and financial inclusion of women as well as work with men to support the women empowerment journey.

"We want to concentrate efforts on programmes that address structural barriers to women’s economic empowerment and put increased attention on engaging men and boys in supporting gender equality advocacy and action, particularly regarding gender-based violence and social or cultural norms,” he said.

Given that formal inclusion is driven by the uptake of other formal financial products or services and that the gender differences in this product category are the largest, promoting these products or services to women poses a real opportunity for the financial inclusion of women.

Through the International Women’s Day marked under the theme ‘Women in leadership: Achieving an equal future in a Covid-19 world’ Rwanda, like other countries, continues to celebrate the tremendous efforts by women and girls around the world in shaping a more equal future and recovery from the Covid-19 pandemic and highlights the gaps that remain.

In this regard, AFR has shown commitment to work closely with the government in terms of strategies and any other development actors to remove all systemic barriers to financial services by putting the poor (women and youth) at the centre of its interventions to advance women’s economic empowerment in general.

Government upbeat

Rose Rwabuhihi, the Chief Gender Monitor at Gender Monitoring Office (GMO), said it is very encouraging to note that there is a continuous improvement that has been made towards financial inclusion because the gender gap in financial inclusion is progressively decreasing.

"This report has definitely contributed to bringing to our attention the state of gender financial inclusion in Rwanda and it is going to play a critical role in documenting our journey, efforts, as well as the progress of gender-responsive financial sector. That’s encouraging for all of us, collective efforts from different partners have also been made and we have to continue from this accordingly by encouraging it,” Rwabuhihi said.

Herbert Asiimwe, the Director of Banking and Non-banking Sector at the Ministry of Finance and Economic Planning, believes that fostering financial inclusion for women is not only going to promote inclusive economic growth but also achieve Sustainable Development Goals (SDGs) to close the gender gap.

"We have come a long way and we have seen brilliant things being achieved. We are seeing the overall financial inclusion gaps reducing tremendously thanks to the brilliant previous strategies and policies that we’ve implemented an, as we move forward, I strongly believe that we need policies that are based on evidence where women data are desegregated very well for decision-makers to be able to develop those policies that are based on numbers that everyone can relate to,” Asiimwe said.