Think Finance, Think Access, Think Equal!

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ImageI am often invited to pose as an example of how far women can go. And I am typically asked how I feel about my career having worked in positions that were often exclusively held by men. I am of course proud of my achievement, fully aware that at no time in my upbringing was I told that I could not do certain things because I was female. But I am also aware that many women around the world face barriers and challenges that prevent them from succeeding in politics, from earning a living, from looking after their families, from running successful businesses or even from opening a bank account.

I “googled” the words “women and barriers” and I got 48,500,000 results. The World Development Report 2012 on Gender Equality and Development says clearly: Gender equality is smart economics. So leveling the playing field is not only about doing the right thing, it will help economies to develop. Our work on development should help us aspire to get less hits when we search for “women and barriers” on the web.  Removing barriers to access to finance for women and making finance equal is not a small weapon in this battle.

Opening and growing a business is tougher for women than for men. Women in developing countries say access to finance is the top barrier to running their business. They often face less favorable borrowing terms and are more likely to pay higher interest rates than men. A recent study found that the financial credit gap for women entrepreneurs to be over $300 billion per year. Women entrepreneurs in developing countries today represent 31 to 38% of formal small and medium size businesses. They could employ more people and help their economies grow if capital was available.

One of the reasons for this imbalance: Gender inequality is still enshrined in legal regimes across the world. Only 38 of the 141 economies set out equal rights for women and men in 45 key areas such as opening a bank account, getting a job without permission from a spouse or guardian, or being able to own and manage property. Where inequality is high, women entrepreneurs have to pay more bribes to run their businesses. All of this is both wrong and does not make economic sense.

Financial barriers are significant and removing them has a huge poverty alleviation and growth potential. That is why I welcomed the opportunity when I was invited last January by U.S. Secretary Clinton to be a member of the International Council on Women’s Business Leadership and to chair the council’s Sub-Committee on Access to Capital. This group of women leaders of public and private organizations has come together to advance the role of women in international business, economic policy development and global economic growth.

The World Bank does a lot of work trying to improve women’s business opportunities in general and providing better access to capital more specifically. We have projects in over 55 countries with significant potential to make it easier for women to provide jobs, growth, and opportunities through enterprises. We work with governments to design and implement national strategies for financial inclusion that increase access for women and other under-serviced groups.  The soon to be published Global Financial Inclusion Index, developed by the Bank and sponsored by the Gates Foundation, offers a rich source of cross-country data on barriers to finance for women. This new and important dataset should contribute to evidence-based policy-making and financial products design in this area. And our work on Women in Business collaborates with financial institutions to expand financial services offered to women entrepreneurs.

I believe the Bank has a strong role to play in this area and our strong partnerships with equally willing and enthusiastic partners are important. As I lead the sub-committee on access to capital for women I will be looking to use the energy and knowledge of this impressive group of top-class female leaders to channel the Bank’s expertise. Let’s face it, on International Women’s Day 2012, the world has no excuse to make it more difficult for women than for men to get the capital and resources they need to run successful businesses. Let’s work together to break through yet another ceiling of growth. 


Sri Mulyani Indrawati

Former Managing Director and COO

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