Financial inclusion can be win-win for both financial institutions and women entrepreneurs: Speakers on International Women’s day 2022
Author: Mehzabin Ahmed
Dhaka, Bangladesh — Bangladesh’s millions of women entrepreneurs are currently underserved by the country’s financial services sector. Better and easier access to finance would help their enterprises, boost the banks’ business, and further the socio-economy development of the country more widely.
This message was the focus of an event held in Dhaka to mark International Women’s Day 2022 by the UN Development Programme, UN Women and the UN Capital Development Fund, along with top executives from several financial institutions.
“In most cases, women entrepreneurs are not aware of the financial services available, how to access them and how to leverage them for sustaining their businesses,” said Diya Nanda, deputy country representative for UN Women. “It is critical to have gender-responsive policies that identify gender-specific needs to work with women cottage, micro, small and medium enterprises (CMSMEs)” Women entrepreneurs or women in business are growing in numbers in Bangladesh and represent a large potential of client base for banks and non-bank financial institutes alike. However, despite women’s good repayment records, banks tend to grant them fewer and smaller loans than men.
To observe International Women’s Day 2022, UNDP, UN Women and UNCDF jointly organized an event in Dhaka, Bangladesh with top-level management of several financial institutions in Bangladesh to highlight the importance of better and easier access to finance for women.
The event was an initiative of a project titled WING: Women’s Empowerment for Inclusive Growth, jointly implemented by UNDP, UN Women and UNCDFwith support from the Embassy of the Kingdom of the Netherlands in Bangladesh.
Stressing the need for accessible loans for women, Sudipto Mukerjee, resident representative of UNDP Bangladesh, said, “We must create an enabling environment for women who are in the cottage, micro, small and medium businesses if we want to see sustainable progress in economic development for Bangladesh. Our WING project is working with the Government of Bangladesh, financial institutions, and the women themselves to empower women and to help Bangladesh achieve the SDGs by 2030.”
Of the almost 8 million businesses in Bangladesh, 99.93 percent are cottage or micro, small and medium enterprises, and 7.2 percent are owned by women, according to a 2016 report by the International Finance Corporation.
Md. Jaker Hossain, general manager of the SME & Special Programmes Department, Bangladesh Bank, was in attendance as guest of honour. “We need to change the mindset of women entrepreneurs along with the bank officials,” he said, “so that they understand the need of proper documentation, keeping transaction records and having a bank account and a mobile financial service wallet to get access to credit.”
“We need to ensure implementing the existing policies of the central bank - Bangladesh Bank - with support from all stakeholders including all financial institutions to achieve the desired goals of gender equality,” he added.
The IWD event especially advocated for strengthening implementation of the Bangladesh Bank’s policy and circulars by the SME and Special Programmes Department (SMESPD) which direct banks and non-bank financial institutes (NBFIs) to maintain at least 10% of their total CMSME loan portfolio for women entrepreneurs with a target to reach at least 15% women entrepreneurs by the year 2024. Only 4.08% of the total CMSME loans were disbursed among women last year.
Dutch Ambassador Anne Van Leeuwen said the Netherlands “is interested in a stable and economically strong Bangladesh, where plenty of jobs with opportunities for future generations are available, high value goods are produced and business opportunities are found everywhere, and for everyone.” Speaking as chief guest, he added that “facilitating access to finance for female entrepreneurs is a win-win situation for both the businesses and the financial institutions. Encouraging and including half of the population, i.e., the women, in economic activities can only increase the economic potential of Bangladesh and assist to pave the way to becoming a middle-income country inclusively and faster.”
This round-table advocacy meeting aimed to address the existing challenges, reality on the ground and policy gaps along with the valuable recommendations. Bas Blaauw, first secretary for RMG and economic affairs of the Dutch Embassy, Bangladesh moderated the discussion with support from Kajal Chatterjee, national project manager, WING, UNDP Bangladesh.
Other representatives from the Dutch Embassy, Bangladesh Bank and other public and private banks and non-bank financial institutions, and WING programme UN officials attended the meeting.