A wide array of evidence documents the differential impact of the COVID-19 pandemic on women compared to men, threatening reversals in many of the gains made in gender equality and the empowerment of women and girls in recent decades. These impacts range from job and income losses to impacts on mental health and increasing gender-based violence. Women-led businesses were more likely to experience a decline in sales and profits during the pandemic and were more likely to close than those owned by men. Relatedly, women entrepreneurs took on more unpaid care than their male counterparts as schools closed and family members fell ill. Even before the pandemic, women lagged men in financial inclusion, and women were over-represented in the informal sector in low-income countries and had greater interruptions work experience.
Yet the crisis has opened a window of opportunity to tackle persistent and stubborn gender gaps and accelerate progress to equality. By focusing on the opportunity to reset economies and ensure a strong recovery, the crisis response could help narrow long-standing gender gaps that limit economic empowerment of women while promoting inclusive growth in the recovery phase and beyond. Centering gender equality in policies that address the effects of the pandemic may allow us to limit backsliding and reinvigorate efforts to ensure a more equal and resilient future.
Policy Directions to Close Gender Gaps
In the spirit of identifying such opportunities, this blog summarizes three notes on broad policy directions that the crisis response can and should emphasize to address gender gaps in entrepreneurship, financial inclusion, and access to safety nets.
Closing gender gaps in entrepreneurship can have a significant impact on poverty reduction, job creation, growth, and innovation. And utilizing the untapped potential of women’s talent has positive effects on economic growth at the macro level. The business case for supporting women entrepreneurs in post-COVID interventions is clear: women have been hit harder by the crisis and, among other things, they often lack resources that are key to crisis survival and recovery.
The first policy note emphasizes three opportunities to support women entrepreneurs. One is to invest in connecting women to digital technologies to sell (e-commerce), save, and secure financing. Another is support for the development of skills and information to micro, small and medium enterprises to grow, especially with digital platforms. Access to the right information at the right time is critical for making informed business decisions that can lead to successful outcomes. Third, financial products and services should be designed to respond to the unique needs of women entrepreneurs, for example, in overcoming barriers in access to funding and building support networks.
The second note proposes a policy agenda for greater financial inclusion though digital systems for women. The crucial starting point is providing access to digital connectivity, including addressing the basic need to eliminate gender gaps in mobile phone ownership, followed by the need for investment in new fintech approaches for small- and medium- enterprise (SME) financing. Mobile usage data, such as digital transaction histories, airtime purchases, internet browsing habits, and payments of rent and utility bills, can be used to create important financial records for underserved SMEs which then enable these businesses to access other financial services.
Investment in digital financial capabilities, a critical component of digital transformation, is needed to ensure that women customers can use digital financial services with ease and confidence. These should be embedded in COVID-19 policy responses in all countries where gender equality is a challenge. For example, in Jordan, people who receive COVID-19 relief payments have the option of using a demonstration e-wallet to build trust and comfort in using digital payments. A supportive regulatory framework is needed to underpin these investments and close gender gaps. A number of recent adjustments to regulatory frameworks aim to increase financial inclusion – such as relaxing know-your-customer requirements and new flexibility with respect to remote account opening.
The third policy note focuses on maximizing the potential of safety nets to promote gender equality. Employed in virtually every country, social protection measures have emerged as a primary policy tool for mitigating the socioeconomic impact of the pandemic-inflicted crisis. The COVID response has been an opportunity to design more inclusive schemes, support a holistic recovery, and address specific gender gaps. For example, the project in Jordan mentioned above also has a communication campaign with messages that aim to raise awareness about COVID-19 pandemic, address the increased risks of GBV as well as promote healthy conflict resolution and stress management within the household. Messaging is designed to be culturally sensitive and delivered via SMS, online tools, or other more traditional means.
To ensure a robust recovery, social protection systems, of which safety nets are one part, need to cover not only the poorest, but also other excluded populations. Schemes can consider differentiated benefits for groups that are particularly vulnerable, which in many instances includes certain groups of women. This expansion, together with efforts to shift to digital delivery of assistance, can have multifaceted benefits especially for women. Digital payments create a gateway to savings, credit, and other financial services provided payments go hand-in-hand with financial and digital literacy efforts. Furthermore, as assistance expands, transitioning programs from cash-only to more ambitious economic inclusion programs can address many constraints to gender equality.
The COVID-19 pandemic has also highlighted the value and importance of investments in adaptive delivery systems for safety nets. Rethinking social registries using a gender perspective can improve the ability to identify vulnerable individuals more accurately. Underpinning efforts in these areas is the need for foundational identification systems for fast, efficient crisis response. Yet several policy and other structural barriers remain to be addressed before women can easily access ID cards.
The COVID-19 response presents an opportunity to accelerate gender equality
COVID-19 has underscored, and exacerbated, long-standing gender inequalities. As governments across the world expand and enact new policies and programs to support households and firms as they offset COVID-19 impacts, these efforts present an opportunity. Designing and implementing policies to account for and address persistent and newly widened gender gaps—including in women’s entrepreneurship, digital financial inclusion, and access to social safety nets—can alleviate poverty, grow firms, get people back to work sooner, and allow countries to accelerate gender equality to ensure greater shared prosperity.
This blog is part of the World Bank Group’s yearlong Gender Equality and Development +10: Accelerate Equality initiative, which explores the important progress made and lessons learned in reducing gender gaps and increasing women’s economic empowerment over the last 10 years, and takes stock of remaining challenges, while strengthening partnerships with a diverse group of stakeholders in the quest to #AccelerateEquality.