Empowering women-led micro, small and medium enterprises by democratizing access to financial tools and services will give a significant boost to the local economy.
In the “Promoting Women and Financial Inclusion Today” webinar hosted by the European Chamber of Commerce in the Philippines, officials from Bangko Sentral ng Pilipinas and the Senate as well as leaders from leading open finance platform UBX and the Insurance provider Pru Life UK highlighted the benefits of including women entrepreneurs in the financial system.
Global studies by the International Finance Corporation and the Organization for Economic Co-operation and Development have found that male-led businesses have more access to finance than their female counterparts.
Yet according to a digital readiness study conducted by the Department of Trade and Industry, female entrepreneurs are motivated to grow their businesses for their families and communities. They just need more knowledge and skills to optimize digital platforms and convert engagement into sales.
“The future of finance is female in many ways,” said UBX Chairman and CEO John Januszczak.
Closing the gender gaps
BSP Deputy Governor Chuchi Fonacier said that closing gender gaps by empowering women to become entrepreneurs and democratizing access to finance for women-led businesses are important areas that the central bank wishes to address.
“One area where there has been substantial exchange and sharing of ideas and initiatives between PASB and its stakeholders is in empowering women to become successful entrepreneurs in the MSME sector. PASB recognizes the important role of MSMEs in the economy and, in line with this, PASB has implemented a wide range of policies and regulatory relief measures to support them – especially as they have been among the most vulnerable sectors during the pandemic,” says Fonacier.
These include measures that incentivize financial institutions to provide financial relief to borrowers, initiatives that encourage bank lending, and efforts that promote continued access to loans and financial services.
“BSP continues to promote the adoption of innovative approaches to MSME financing by banks such as agricultural value chain financing and supply chain financing to direct much needed funds for this sector,” he said. said Fonacier.
Fonacier said empowering women entrepreneurs also involves financial education measures, as it will equip them with the right knowledge to harness the right tools for their financial needs.
“Financial literacy promotes the economic empowerment of women as they aspire to become leaders and agents of change, financial inclusion and sustainability. Financial literacy leads to the growth and development of women’s well-being and, in turn, contributes to economic growth. Financial feminism through financial literacy offers an opportunity to not only close the gender gaps in pay, investment and wealth, but also to use the growing financial power of women to align with the goals and actions needed to build a sustainable and equitable future,” Fonacier said.
Senator Risa Hontiveros, who chairs the Committee on Women, Children and Family Relations, lamented that the pandemic is amplifying the Philippines’ vulnerabilities.
“We need to expand opportunities for women, especially when it comes to financial inclusion. We can find solutions to common issues of limited access to financial support, training, business development services and technology that will improve the competitiveness of women-led micro, small and medium enterprises,” said Hontiveros .
Hontiveros called on the government to step up its support for the development of digital solutions that democratize access to financial services for women entrepreneurs, noting that the majority of businesses in the Philippines are run by women.
Anne Yosuico, UBX’s managing director for banking, agrees, saying it’s imperative for the financial industry to empower women-led businesses, as this leads to significant growth in the wider economy. .
Citing a McKinsey Global Institute study, Yosuico said closing the gender gap could add between $12 trillion and $28 trillion to the global economy, which is larger than the combined economies of the United States and from China.
World Bank data shows that the Philippines is one of three countries with more women homeowners than men. In fact, before the pandemic, 55.8% of business name registrations were owned and operated by women, according to DTI data.
About 64% of MSMEs supported by DTI Negosyo centers were headed by women. Another 64 percent of the 5.8 million individual cooperative members under the National Association of Cooperative Training Centers are women.
“If you look at the potential impact of women, that’s a game-changer,” Yosuico said. “This investment in women, whether through education or targeted financial services, will have an impact of this magnitude.”
Yosuico said UBX aims to empower women entrepreneurs through its open funding platform, which is considered the leader in the Philippines.
Through open finance, participating banks and other financial institutions are able to tailor financial products and services to women’s needs.
“There are so many other things we can do. We can start looking at how women entrepreneurs can help other women entrepreneurs too. We can provide targeted resources and services aimed at empowering women. Above all, participation and representation are important, so wherever you are, you need to keep the conversation going. This will open up more access for women, especially female entrepreneurs,” Yosuico said.
Pru Life UK President Ida Tiongson said it was imperative for the Philippines to address the four main issues facing women entrepreneurs, which she listed as lack of money, lack of confidence, lack of support and lack of time. These four factors, she said, can be addressed by promoting financial literacy among women.
“Helping women will have a domino effect on the economy,” Tiongson said. “The main thing for all of us is education. »