The rising gender gap in financial services threatens Nigeria’s financial inclusion target

Image used to illustrate the story (efina report)
  • Gender gap is rising in Nigeria's financial services and stakeholders call for proper measures to close the gap.
  • A report conducted by the CBN and EFInA finds that differences between men and women in education, income, and trust in financial service providers contribute to the gender gap in financial access.
  • The report states that Nigerian women are still financially excluded from the formal banking space and more tend to use the informal system.

Nigeria still faces a significant and growing gender gap in financial inclusion as a result of huge differences between men and women in education, income, and trust in financial service providers.

This is the outcome of new research on women’s financial inclusion jointly conducted by the Central Bank of Nigeria’s Financial Inclusion Secretariat and Enhancing Financial Innovation & Access (EFInA).

The report seen by Business Insider SSA found that levels of income, education, and trust in financial service providers are strongly associated with financial inclusion in Nigeria, for both men and women.

It also states that women in Nigeria tend to have lower levels of income, education, and trust in financial service providers, and this contributes strongly to the financial inclusion gender gap.

Other high points from the report

  • The most important drivers of financial exclusion for both genders are lack of income, lack of education, and low trust n Financial Service Providers (FSPs) and that these factors also drive the gender gap.
  • Nigerian women are less likely than Nigerian men to use formal (regulated) financial services such as bank accounts.
  • Nigerians living in rural areas are significantly less likely than those in urban areas to use formal financial services, even when all other factors are held equal.
  • Women in the North are more excluded than their peers in the South, which may be driven by conservative socio-cultural gender norms.
  • Women who are married are more likely to be financially included than those who are single (never married). And women in the youngest and oldest age groups are more likely to be financially included than younger or older women.

Aishah Ahmad, CBN’s Deputy Governor for Financial System Stability, during the launching of the report on Monday, December 9th, 2019, said, “The path to inclusive economic growth is paved with women’s economic empowerment. The gender gap is rising. It is a worrying trend that underscores the importance of this research. We need to work with targeted segments and speak to their unique challenges. It requires not incremental thinking, but bold, visionary ideas that will drive transformation.”

Ashley Immanuel, Head of Programmes at EFInA, said to address the financial inclusion gender gap, stakeholders need to work together to address this gender inequality, earn women’s trust in financial services, and explore ways to build a better business case for reaching excluded women.

The report concludes that stakeholders should prioritise activities and interventions that will increase women’s levels of income, education and/or trust in FSPs.

Launched in October 2012 and revised in 2018, the National Financial Inclusion Strategy (NFIS) aims to increase the percentage of adult Nigerians who own bank accounts and use formal financial services to 80% by 2020.

In June 2019, the CBN governor, Godwin Emefiele, expressed optimism towards achieving the target and increased the target to 95% for eligible Nigerians by 2024.

To achieve this, stakeholders believed Nigeria will place a priority on women's participation in the country's financial services.

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