«Women-only focus group discussion in Kilimanjaro, Tanzania. 17 August 2011 i Version 1 – August 2011 Contents Abbreviations and Acronyms Executive ...»
Training women as extension workers: Girls and women need to be encouraged to train as extension workers. Some efforts in this direction are the provision of special training courses for women farmers, and the reorientation of home economics curricula to emphasise the needs of women in agricultural production. This includes improving access to higher education for women and creating incentives for women to work in rural areas, e.g. by the provision of culturally suitable accommodation, transport etc.
Work with partners: There is a need to work in close partnership on gender. This is particularly the case with increasing women’s access to extension. In the past, there has not been enough cooperation or coordination between agencies, ministries of agriculture and NGOs (Jiggins et al 1998).
5.6 Access to credit and financial services As evidenced in Section 2.3.2, women face differential access to financial services and although the situation is improving, there are still issues with provision of the type of financial service that is suited to women’s specific requirements.
Women face a number of barriers to accessing credit and other financial products:
Lending terms tend to favour larger commercial enterprises and not small-scale activities that women are involved in (Mikalitsa 2010). Husbands’ signatures may be needed on loan agreements (WB, FAO, IFAD 2009; SIGI 2009).
Lack of resources. Due to women’ lack of land ownership, they lack collateral for loans that tend to be based on property. Women’s limited education means that they are unable to engage with financial institutions or have the confidence to do so (see Section 5.4).
Women tend to be more risk averse. Women’s productive activities are less stable than men’s, making planning more difficult for women. The focus on a narrow range of activities, e.g. perishable goods grown on often less fertile land, may make women more susceptible to climatic and environmental risks, price and market fluctuations (and price bullying), and epidemics of pests and disease. Women tend to be at the bottom of the hierarchy in local and global value chains and are thus the least protected from fluctuations in employment and income caused by economic and environmental factors.
They have less incentives and less ability to take risks on economic activities that may yield a higher income (Bolzani et al 2010; Hurley 2010). This is supported by field work in Ethiopia and Tanzania where women faced greater repayment burdens and were very worried about debt.
5.6.2 Existing approaches There are a variety of rural financial services, beyond credit, that may be of benefit to women, including savings, insurance, pensions, remittances and leasing arrangements.
These products are provided by a number of different types of rural finance institutions (WB, FAO, IFAD 2009). These institutions may be more or less well-equipped at accessing women farmers and designing gender-sensitive products. However, it is clear from the literature that although there is some progress with commercial banks in starting to tailor their products specifically for women, it is within the other categories where some success
has been achieved:
Formal-sector providers. Commercial and state banks with rural development or
poverty portfolios. Examples include:
The Centenary Rural Development Bank, Uganda, which has designed an innovative product that makes credit available to both men and women farmers for the purchase of animal draught power (WFP 2010c).
Banks such as ICICI Bank in India currently aim to give universal access to loan
products and other services. This strategy would consist of many elements:
rolling out credit cards and ATMs in villages to give everyone individual access, building and maintaining individual credit histories through credit bureaus, basing credit decisions on scoring models (risk-based lending), moving from group-based to individual lending, and tracking clients through their life cycle to offer customised products for life-cycle needs (WB, FAO, IFAD 2009).
K-Rep Bank in Kenya offers asset leasing for cooling tanks for milk production or agricultural tools or machinery59.
Specialist microfinance institutions that provide specialist financial products to poor households. There are a number of different types (Grameen affiliates, trust banks, village banks) with slightly differing objectives, with some even providing training and technical assistance in financial matters.
Member-based financial organisations, such as financial cooperatives, credit unions and SHGs, which are owned and run by members. For instance, the International Cooperative Alliance (ICA) supported a credit scheme among women cooperative members in Tanzania. Thirty thousand women in the northern region of Kilimanjaro were helped by the ICA to set up savings and credit associations to raise capital for their businesses.
The ICA offers training in book-keeping and savings and credit management for women in cooperative development, the ICA’s priority area. Women contributed a total of 200,000 shillings (about US$400) two years ago to form the Masasa women's credit association. The money contributed acted as shares. Each member is allowed to borrow not more than half of what she has contributed. Other credit associations helped by the See http://www.k-repbank.com/ ICA in Tanzania are among subsistence coffee and maize growers who use their loans to buy fertiliser and pesticides, and to make improvements to their farms60.
Integrated provision of financial services through rural development programmes and NGOs. This is usually large-scale implementing organisations, such as the World Bank or the IFAD that work with financial cooperatives, credit unions and SHGs to mobilise financial services for programme beneficiaries.
Informal institutions. There are also more informal networks that offer credit, such as money lenders, friends and relatives, which provide loans for both production and consumption (Kimuyu 1995; Perry 2002).
Alternative providers include mobile phone banking, such as M-PESA in Kenya that is operated by the mobile phone operator Safaricom (Mas and Radcliffe 2010).
5.6.3 Opportunities Access to financial services can become part of a virtuous spiral of empowerment and in the right circumstances contribute to truly transformative outcomes for women. Much attention has been given to the opportunities that financial services provide (particularly
microcredit programmes). Potential impacts include:
Increased access to assets – bought with loans/savings or indirectly through income generated by loans/savings.
Reduced vulnerability to shocks, such as seasonality and food-price rises. Vulnerability is reduced within the household and community when financial services help to protect livelihoods, contribute to income diversification, smooth incomes for consumption and provide a safety net in times of need (WB, FAO, IFAD 2009).
Increasing women's income levels and control over income leading to greater levels of economic independence.
Supporting women’s access to networks and markets giving wider experience of the world outside the home, access to information and possibilities for development of other social and political roles.
Enhancing perceptions of women's contribution to household income and family welfare, increasing women's participation in household decisions about expenditure and other issues, and leading to greater expenditure on women's welfare.
More general improvements in attitudes to women's role in the household and community (Mayoux 1997).
5.6.4 Risks Better access to financial services does not automatically lead to transformative or even gender aware outcomes for women. A substantial and important review of existing evidence
of microcredit programmes concludes that (Mayoux 1997):
Credit is debt. High uptake and repayment rates on loans are sometimes used as indicators of women’s empowerment. However, the picture is more complicated than that. Women may repay through taking loans elsewhere and get into serious debt. Loans See http://www.gdrc.org/icm/wind/tanzania.html.
may also be controlled by men (Husain et al 2010; Chowdhury 2009). Some have expressed concerns that women’s microfinance programmes may be merely using women as unpaid debt collectors, mediating between development agencies and male family members, increasing their dependency on men and/or conflicts between women to fulfil repayment targets (Goetz and Gupta 1996; Noponen 1990; Rahman 1999).
Additional risks. Women may use loans to increase their income, but this often comes at the expense of heavier workloads and repayment pressures. Women's increased autonomy may in some cases be temporary and lead to the withdrawal of male support.
In certain cases there have been fears that women’s small increases in income are leading to a decrease in male contribution to certain types of household expenditure.
Targeting and reaching poorer women is challenging. In some contexts, programmes benefit women who are already better off. In others, poorer women are freer and more motivated to use credit for production. However, in most cases the poorest women are by-passed in both individual and group-lending programmes, or are least able to benefit because of their initial low resource base, lack of skills and market contacts (Husain et al 2010).
5.6.5 Recommendations Institutional arrangements for financial institutions. To ensure that financial institutions are able to design products that suit women, there needs to be a good staff gender policy and capacity to undertake analysis of the particular barriers to uptake of services that women face (WB, FAO, IFAD 2009).
Credit/loans. There are a variety of options for more flexible financial services that are suitable for women, including mobile banks. When it comes to alternatives to collateral requirements, one alternative is to allow for traditional women’s assets (such as jewellery) or to consider a system of a group liability (that can support the participation of poorer women) and graduation from collective to individual lending (Quisumbing and Pandolfelli 2008). However, the primary need is to ensure that products are designed with women in mind61. Credit for women traders is also needed, as biases against lending to traders are particularly acute for women traders, including those operating in urban wholesale markets (Baden 1998).
Savings. Village savings and loans groups allow women to manage their money collectively and even set up income-generating businesses either collectively or individually through loans provided by the group. To support women’s control over their income, individual bank accounts are also needed. Similarly, with savings there is a need to assess the suitability of existing arrangements62 (WB, FAO, IFAD 2009).
There are some standard detailed questions to consider when assessing the gender awareness and potential transformative design of credit facilities. These includes questions about collateral requirements and whether women’s assets are accepted, requirements for joint registration, flexibility and suitability of application procedures, repayments schedules and interest rates, size of loans, requirements for use of loans, and group vs. individual lending (WB, FAO, IFAD 2009).
There are some standard detailed questions to consider including minimum entry-level deposits, flexible deposit and withdrawal requirements, confidentiality, protection from husbands and male relatives, and location of services.
5.7 Additional actions As described in Section 4 of this report, the fieldwork conducted has enabled us to divide women into different groups which will require different activities in order to be targeted by P4P. This section deals specifically with potential actions not mentioned in Occasional Paper II, but that can be of benefit to groups of women not currently reached by P4P. These actions can potentially transform gender relations.
5.7.1 Supporting women’s access to and ownership of land Land is the most important asset for households in developing countries. Owning land means that access to a source of production and income, and land can be used as collateral for financial services which indirectly can lead to increased production and income.
This is also the case for women in rural areas. Without land women are not able to produce for the markets, they will not be legally recognised as producers in their own right, and they will be excluded from accessing credit (as well as other financial assets). Additionally, since women are very likely to have significantly lower incomes, even in cases where they do have access to, and are able to work, a plot of land, they will be less likely to have disposable income to purchase inputs, such as seeds, tools and fertiliser. Additionally, in many countries, women’s property rights are limited by social norms and customs, and at times by legislation. Ensuring that women enjoy full legal rights to own property and to inherit is critical for economic empowerment.
Although it is perhaps beyond P4P to support the strengthening of women’s legal rights, such as their right to land, it might be possible to work in conjunction with organisations that do support such measures. A few examples of approaches that WFP could support
through supply-side partners include:
In Sierra Leone, Action Aid is working with women’s groups to support their access to land to promote vegetable gardening (Johnson 1999). This involved negotiating with village chiefs to reach agreement on a plot of land that women could gain access to.
In Niger, the International Crop Institute for the Semi-Arid Tropics (ICRISAT) worked with women’s groups to support their access to degraded lands. Village chiefs were willing to allot a parcel of such land to the local women's association, ensuring their ownership.