Putting women at the centre of inclusive finance

March 8th, 2022

Evidence shows that effectively including women in economic activity boosts growth.

People’s ability to participate within the more formalised markets which characterise the modern sector of an economy is often conditioned by the degree of access to the financial system. Exclusion from finance can result in exclusion from opportunities to participate productively in value chains.

FSD Kenya’s focus on financial inclusion has sought to deliver direct benefits to financially excluded and underserved populations, including women. However, greater long-term impact will derive from the dynamic function of finance to enable the transformation of economies, generating growth, jobs, trade, and assets for both men and women.

Access to finance is one path to economic empowerment.  Yet, women are disadvantaged in many ways, hindering their ability to access value adding finance. For instance, on average, women are less educated than men, earn less income, and own fewer assets which makes them less likely to be considered or targeted in design of finance solutions.

On the other hand, evidence shows that women are better credit customers than men – a strong business case for financial service providers[1]. The financial services provision related decisions are largely made by men who hold most of the leadership positions in financial institutions and could be subject to unconscious gender biases.  Social gender norms further compound the problem of financial exclusion of women.

Kenya’s financial inclusion gender gap

According to the 2021 FinAccess Household Survey, eight out of every ten Kenyans (83.7%) have access to formal financial services. The gap in financial access between men and women has continually improved, reducing from 8.5% in 2016, to 5.2% in 2019, then to 4.2% in 2021. However, the gender exclusion gap increased to 1.6% from 0.5% between 2019 and 2021, providing evidence of how the COVID-19 pandemic has disproportionately affected women.


Formal financial inclusion in Kenya is mainly driven by access to mobile money which contributes 79.4% to this. But even with this near ubiquitous access, the gender gap is obvious.


A deeper look into the numbers shows that, as well as using formal services, women also rely strongly on informal services to meet their financial needs. This is true regardless of the level of income or education [2].


Clearly, the value proposition of informal offers with their flexible terms and rich information base, remains significant for women. This is especially because informal finance leverages social capital and social networks, which are important assets for women.

Understanding how the formal sector can add value to Kenya’s rich informal infrastructure is an important area for financial inclusion. Through formalising remittances, mobile money is an example of formal finance adding value in the context of a highly developed informal infrastructure based on a social network economy.

But there are many more opportunities for formal finance to reduce the risks and enhance the efficiency of informal offers, potentially improving the value of financial services for women. 

FSD Kenya’s work on gender and women’s economic empowerment

International Women’s Day gives us the perfect opportunity to reflect on our work.  FSD Kenya has undertaken significant work on gender and women’s economic empowerment particularly through research and our work on informal groups. This includes the recently concluded women’s economic empowerment project in Marsabit, a gendered financial products and services survey among urban women retailers, and a gendered review of financial laws in Kenya.

We have just entered into a new strategic period with women at the core of everything we do. Our intention is to shift to a more transformational approach that puts the issues of gender, women’s economic empowerment and economic inclusion at the centre of all our interventions.

Gender and women’s economic empowerment (WEE) is a key strategic driver in our programme and will be integrated across all projects and interventions. This way, projects provide opportunities to yield stronger impacts for women.

As a first step, we carried out a gender assessment to understand where we were and what we needed to do to realise this ambitious goal. The views we heard motivated us to embark on the journey. We will be intentional in design and execution of all our interventions.

“Gender cuts across everything we are trying to do, so it’s important for FSD now. We have learned that ‘when you design for everyone, you design for men’. We need to change.” (FSD interview respondent)

We have adopted the World Health Organisation’s gender framework to guide our programme activities. This is work in progress and we will adapt it as we go along.


Although we do not intend to undertake any activity that is gender discriminatory or blind/neutral, we appreciate that we might need to deal with aspects of discrimination and lack of gender awareness in some intervention areas before we can realise tangible progress towards gender transformation. The projects designed under the new strategy will be situated within this gender framework, with all of them falling within levels 3, 4 and 5.

We are excited about this gender transformation journey. We appreciate that this will necessitate doing things differently. It will require undertaking a gendered analysis of the market to understand and design interventions with the potential to yield the desired gender outcomes. We will also need to identify the right partners who share our optimism, commitment, and passion.  It will not be easy but we are open to learning as we go along and are motivated by the envisaged impact on women and the Kenyan society that we anticipate.

Understanding gender norms and the way they influence the functioning of the financial market system – including the behaviours of women, FSPs, regulators, and others – is critical for systematically and effectively designing interventions that increase women’s financial inclusion and contribute to women’s economic empowerment. (CGAP 2021)





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