Posted by: Katherine Oglietti
Female bank leaders distribute loans to clients in the Phillipines.
“Gender inequality is the fundamental root cause of most of the remaining hunger and poverty in the world.” That was among the more poignant points made last week during a discussion on gender and microfinance at Microfinance Monday (#MifiMon), a bimonthly Twitter forum. Why do many microfinance programs focus on women? Is this focus justified? How does gender mainstreaming contribute to poverty alleviation?
The Microfinance Monday participants’ consensus regarding the need for a gender-based approach in microfinance reflects the common sentiment in the industry. UNIFEM states that women are disproportionately affected by poverty, accounting for 70% of the world’s poor. The corollary is that if an MFI seeks to alleviate poverty or provide services targeted to the poor, it should include a gender focus in order to reach those goals. According to the World Bank, women tend to reinvest in the household at rates of 90% of their earned income, so giving women access to savings and credit can improve family health, nutrition, and education, thereby contributing to other aspects of development. (Men, in contrast, reinvest an average of 30-40% of earned income into their families). Women also have higher on-time loan repayment rates, so many MFIs view them as more creditworthy clients.
Taken from a different angle, microfinance can be seen as a vehicle for women’s empowerment, leadership development, and capacity-building, especially if MFIs design their programs in ways that take women’s specific needs into account and follow a holistic approach, beyond access to credit.
This week, we will focus our discussion on gender. In response to inquiries raised during the Twitter forum on how MFIs are incorporating gender outreach into their programming, we will present some data extracts on gender indicators as reported by MFIs to MIX, exploring such topics as how many MFIs specifically target women, how MFIs’ strategies and programs encourage gender mainstreaming, and whether gender-focused MFIs also incorporate gender equality policies within the workplace. Women’s World Banking (WWB) will also join our discussion, presenting their views on the topic in the coming days.
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