At Women’s World Banking, we are dedicated to building evidence on the relationship between women’s financial inclusion and economic empowerment. Our definition of financial inclusion goes beyond access; it encompasses the choice to access a full suite of responsibly delivered financial services and the capability to use them effectively.
Over the past five years, we have gathered insights from over 24,000 women. These are women who have used accounts to save for their children’s school tuition, women who accessed productive credit for the first time and were able to start or grow their small business, women who save valuable time by more easily sending money to family, and women who feel more secure knowing they have insurance in case they need to go to the hospital. We have seen the difference in how women talk about their financial lives once they have the choice to access and capability to use financial services – they are confident, they are in control, they are proud.
To deepen our understanding, we conduct rigorous impact evaluations. Our ten-year strategy includes ten quantitative and qualitative studies, assessing the impact of our women-centered design interventions. This summary paper is our transparent findings from the first three of these ten studies, conducted between 2020 and 2023.
What is Economic Empowerment?
Our definition also considers economic empowerment as a process rather than as an end-state. We build off the work of Dr. Martha Chen, who developed a conceptual framework to monitor the impact of microfinance on women’s lives, identifying four pathways through which women experience change. We have adapted these to our four dimensions of Women’s Economic Empowerment (WEE):
- Material Change: Focuses on change in earning capacity, income, assets, and her ability to meet basic needs. It reflects the more tangible changes women experience as they access and use financial services.
- Cognitive Change: Refers to changes in awareness, knowledge, and skills. It is a vital component of women’s economic empowerment as women often have lower education levels, lower digital and financial literacy, and less trust in financial services at the outset.
- Perceptual Change: Focused on change in women’s self-awareness and confidence, as well as her perceived financial security and vision for her future.
- Relational Change: Includes changes in financial decision-making, control over resources, participation, visibility, and respect. It is an important part of economic empowerment as it reflects women’s agency in relation.
There are many concepts of women’s economic empowerment. Naila Kabeer defines empowerment as the process by which women take control and ownership of their lives through expansion of their choices and can be thought of in terms of three interrelated dimensions that make up choice: resources, agency, and achievements. The Bill & Melinda Gates Foundation says that “A woman is economically empowered when she has access to: skills, resources, and institutions necessary to effectively participate in markets; [and the] power and agency to act on personal preferences in making economic decisions, including the control of personal and household resources.” Our WEE framework similarly addresses these core concepts, with material and cognitive change enabling women to build resources, and perceptual and relational change contributing to her agency, power, and participation.
For every Women’s World Banking intervention, we map out the economic empowerment outcomes we expect at the outset and design with these outcomes in mind. We use a variety of methods to measure change across these dimensions, including administrative data from FSP partners, surveys and interviews with women customers, and rigorous impact evaluations. Some of the dimensions of change are harder to measure than others, and a diversity of tools enables us to assess the changes in financial behavior and felt experiences of women, contributing to our understanding of their economic empowerment. Read the full report and gain deeper insights into our findings.
