Financial inclusion for women empowerment in South Asian countries

Abstract

Purpose This paper aims to address the issues of Asian countries toward why females are discouraged and more likely to be removed from the formal financial system than males. Further, whether there is any connection between religion and women’s financial inclusion is also addressed. Design/methodology/approach This paper explores gender disparities in the use of structured financial services through multilevel models tailored to the individual. The data from 2004 to 2017 have been used for eight South Asian countries, including Bangladesh, India, Pakistan, Sri Lanka, Afghanistan, Maldives, Nepal and Bhutan. We used a multilevel modeling methodology to estimate the impact of the socio-economic climate on women’s financial inclusion while controlling for individual-level features, with all control variables included, the two-level logistic regression model used for this study. Findings The results of this study demonstrate that sex appears to be strongly correlated with the usage of financial services. The study also found that in nations where religious restrictions limit women’s willingness to work for a living, they are less likely than males to own a bank account. However, through legislation and regulations, countries that encourage gender equality in the labor market and have effective regulatory mechanisms to maintain these initiatives appear to have more financially active women. Practical implications This research advises that government authorities strengthen women’s empowerment in South Asian countries. Originality/value To the best of the authors’ knowledge, this is the first paper that explains the linkage between financial inclusion and women empowerment and will contribute to existing knowledge.

Sustainable women empowerment at the bottom of the pyramid through credit access

“…Based on the information found from the extensive literature review, it has been clearly understood that for SWE and sustainable economic growth, the FI of poor women and bridging the BoP with the formal financial system are very important. Furthermore, the FI EDI 42,1 and AC are highly influenced by the social, economic and individual characteristics of borrowers (Agnello et al, 2012;Aziz et al, 2022;Datta and Sahu, 2022;Kaur and Kapuria, 2020;Malik et al, 2021). Though the researchers observed these social, economic and individual determinants of FI in different contexts in different cultures, we have not found any single study in which a complete framework has been observed.…”

“…Furthermore, the FI and AC are highly influenced by the social, economic and individual characteristics of borrowers (Agnello et al. , 2012; Aziz et al. , 2022; Datta and Sahu, 2022; Kaur and Kapuria, 2020; Malik et al.…”

“…Subsequently, the financial exclusion is triggered by both demand and supply side obstacles of institutional finance. The supply-side obstacles are market conditions, high bank charges, physical access to bank premises and terms of banking system (Kempson et al, 2004) while the demand side obstacles are self-exclusion due to negative perceptions or experiences of financial institutions toward loan application (Ozili, 2018), allocation to payback (Naegels et al, 2022), lack of financial literacy (Lee and Huruta, 2022), low level of income (Barnett et al, 2021), identity documents requirement, controlled mobility due to religious limitation (Aziz et al, 2022) and absence of physical collateral (Ghosh and Vinod, 2017). These both demand and supply-side obstacles limited the access to finance among women from the BoP.…”

“…, 2022), lack of financial literacy (Lee and Huruta, 2022), low level of income (Barnett et al. , 2021), identity documents requirement, controlled mobility due to religious limitation (Aziz et al. , 2022) and absence of physical collateral (Ghosh and Vinod, 2017).…”

Nexus between financial inclusion and women empowerment: evidence from developing countries

“…Due to a lack of income and knowledge, women are disempowered. Women empowerment is required to manage this issue of cultural limitations and gender discrimination and allow them to live their lives freely (Aziz et al , 2022; Laila, 2006). Financial inclusion is important in empowering women and assisting them in overcoming the obstacles they face.…”