Mountains, low lands, wetlands, coastal areas, rainforests, islands… Sounds like an entire continent, but that geography is actually just one country’s: Papua New Guinea. With geography like that, you can imagine, getting anywhere is a real challenge. If you are a woman—juggling household responsibilities and managing a business—going to the bank to save, borrow or check on your money, while important, becomes too much of a burden.
The rugged and diverse terrain of the country was just one of the constraints to financial inclusion the Women’s World Banking research team uncovered during our research in Papua New Guinea in May 2012. Women in Papua New Guinea, mirroring our research from other countries, save primarily for the family – improved education, healthcare and emergencies, improvements in housing and secondarily to grow their businesses. As the Pacific region continues to evolve into a modern monetary economy with increasing financial pressures, we turned our attention to understanding how the geographic, social and cultural circumstances of low-income women affect their opportunity for financial inclusion and economic empowerment.
So what can a financial institution do to reach a budding woman micro-entrepreneur from the village? One of the answers is mobile banking. Mobile banking is great for exactly this kind of problem: as long as you have a phone and signal, you can transfer money, check your balance, pay a loan… everything you do at a bank, you can do from wherever you are, be it the Bay of Bismarck or in the middle of a palm oil enclave. Because the state of law and order in the country leaves much to be desired, not having to carry cash around is critical: a big concern of PNG women is protecting their money because of the unsafe conditions. It has other benefits for women as well. We know that women especially value having privacy and control over their finances and mobile banking easily affords this. It was no surprise that the women (and men) in our research expressed a profound interest in mobile banking, especially valuing the opportunity to access a lower-cost way of saving money that is closer to their homes.
At its base, Papua New Guineans are not widely financially included: roughly 85% of the population does not have access to formal financial services. Furthermore, the challenging geography has several implications that make access to banks particularly difficult for women. Because it is difficult to effectively build and maintain roads, a large portion of the mainland does not have roads at all. Even when there are roads, travel is long, expensive and rather dangerous due to weak state security. Women in particular are at risk of assault, harassment and theft in public places and on public transport. Bank branches are few and far between because it is too expensive to build and staff branches in remote areas. Even if you overcome all that, once you get to a branch, the average wait time for a transaction is an hour. The difficulty is tripled for Papua New Guineans who live on the outer islands.
“Going to the bank can be a hassle because there are a lot of queues and it is not always convenient.”
– Focus group participant in Kimbe
Two caveats: In order for mobile banking to be successful, people must have access to a mobile phone and have the knowledge to use it. Papua New Guinea still has a ways to go in ensuring the entire country has mobile service. According to the World Bank, only 26% of the population had access to a mobile phone in 2011, but mobile penetration in the cities is high. Literacy in mobile phone usage is also essential. In our research, women’s familiarity with mobile phones ran the gamut from not knowing basic functionality to using their phone for communication and gaming. Mobile coverage and mobile phone literacy both need to be improved to fully realize the benefits of mobile banking.
Our research partner Nationwide Microbank (NMB) was actually the first to introduce mobile banking initiative in the country. Called MiCash, the
initiative is a partnership between NMB and the biggest telecoms firm in the nation, Digicel. MiCash allows clients to make financial transactions through their mobile phones, including depositing or withdrawing cash and checking an account balance. It also provides value-added services, such as purchasing goods and services, processing payments and purchasing air-time money transfers.
A Kimbe woman shares her tech-savvy: “I think that phone banking is fine. I do not worry about them stealing my phone or my passbook. Only I know my PIN and account number, so this is not a problem for me.”
NMB has a specific focus on making sure that MiCash reaches women. According to Managing Director Tony Westaway, 37% of MiCash clients are women and they expect this number to grow as the bank, after receiving the blessing of the Central Bank, rolls out product more widely. It is currently operating through 154 agents in 12 branches across the country. So far, MiCash has exceeded K21 million in transaction value (over half of which have been deposits) and 4 out of 5 MiCash clients were previously unbanked. We hope that MiCash’s success inspires others in the Pacific and elsewhere to make mobile banking an essential offering of their institution (agent banking is a great alternative or complement to mobile banking, but that’s for another blog post!).
Our team uncovered plenty of other fascinating facts about the conditions of women in the Pacific, such as the importance of enclave developments to the country’s economy, the tradition of ‘bride price’ and pressures of a ‘wantok’ on a woman’s finances. Read the executive summary or download the full report to learn about them and our recommendations to microfinance practitioners and donors to deepen financial inclusion for women in the region.
With funding from the New Zealand Aid Programme, Women’s World Banking conducted a gender study in Papua New Guinea and Samoa to explore women’s ability to access and control financial resources and analyze the issues that must be addressed in order to provide effective financial services to women toward their deepened financial inclusion. We are grateful for their support.
