Financial inclusion and land ownership status of women

Abstract

Purpose The purpose of this paper is to empirically examine the influence of women’s land ownership status on their inclusion in developing economies. Design/methodology/approach The study adopted a cross-sectional analysis. Data were taken from Global Findex data of World Bank and Indices of social development. Data were analysed using limited information maximum likelihood to establish the relationship between usage of basic financial services and women’s land ownership status variables. The study considers different demographic, social and economic factors as control variables. Socio-economic gender equality index and land ownership status of men are considered as instrumental variables in the estimations for controlling endogeneity problem. Findings The study proves that there is a significant influence of women’s land ownership status on their demand and usage of basic financial services. The results show that women who own land alone have a significant relationship for formal account ownership and formal savings but are deprived of formal and informal credit. The results find that women are more likely to avail of formal credit when they are backed by someone else in the family especially men. Irrespective of the wealth quintile to which women belong, they are deprived of credit if they do not own any land. The findings also show that women in higher wealth quintiles are more active in availing credit. Research limitations/implications The study is limited to the extent of influence of women’s land ownership status on their demand for basic financial services. Practical implications The study recommends appropriate economic and financial policies to encourage women to own, possess and use their land for personal as well as entrepreneurial activities. The study also suggests for policies to encourage women for joint ownership of land for better credit availability. Social implications Formal institutions must be more favourable for women in providing credit facilities because women play an essential role in economic development in developing economies. Originality/value This study is the first of its type in providing empirical evidence that women’s land ownership status influences their demand for basic financial services in developing countries.

What drive gender gap in financial inclusion? Evidence from Cameroon

“…Finally, beyond the socioeconomic drivers of gender gap in financial inclusion discussed above, other empirical studies have pointed out the role of institutions and legal barriers in explaining the differences in access and use of financial services between men and women. Balasubramanian et al (2019), using a sample of 148 countries, shows that institutions discriminate against women in access to land ownership. This difference in treatment reduces their involvement in entrepreneurial activities and contributes to keeping them away from the formal financial system.…”

“…(4) Legal barriers. There are also drivers of gender gap in financial inclusion and some discrimination against women limits their access to inheritance and land ownership, preventing them from holding assets that can be use as mortgages to take credit (Balasubramanian et al, 2019). Legal barriers also include documents required by financial institutions, such as identity cards and passports.…”

“…Theoretically, previous studies have shown that gender gaps in financial inclusion can be caused by differences between men and women in their access to education (Akhter & Cheng, 2020), income level (Demirgüç-Kunt et al, 2015) as well as legal and institutional barriers (Balasubramanian et al, 2019).…”

Formal vs informal demand for credit by women in urban India: a comparative study in slums of Delhi and Mumbai

“…Sometimes, women’s restricted spatial mobility due to social restriction and confinement to traditional norms may negatively impact their ability to use formal credit (Guerin, 2011). Thus, women who are mostly backed by someone else in their family, particularly men, are more likely to use the formal credit (Balasubramanian et al , 2019).…”

“…The past evidence suggests a significant relationship between the household ownership and demand for credit (Crook, 2001; Nguyen, 2007; Mpuga, 2010). Notably women, irrespective of wealth, are usually deprived of loans if they lack possession of land (Balasubramanian et al , 2019). Household expenditure is another determinant which is likely to affect the demand for credit, particularly in urban cities.…”