From Account Ownership to Full Financial Inclusion

Tuesday 30th April 2024

Although more women around the world have access to bank accounts, they’re not necessarily using the accounts to achieve full financial inclusion. To turn this around, new research and innovative solutions by Alliance members provide models that chart a path from account ownership to usage to building financial health.

The share of people with a bank or mobile money account has grown to 76 percent, up from 51 percent a decade earlier, according to the World Bank’s most recent Global Findex data measuring global access to financial services. An even bigger increase is seen the share of women with accounts, from just 45 percent in 2011 to 74 percent in 2021.

Yet, women’s use of financial services lags behind their account ownership. Three in four women own an account, but fewer than one in three are actively using them for savings or borrowing purposes.

To better understand and address this gap, Mastercard in partnership with Brazilian neobank Nubank has released new research which draws insights from three years of transactional and behavioral data from 3.6 million Nubank customers, as well as qualitative surveys of 2,000 Brazilian consumers. The study maps the drivers and barriers people encounter in their journey toward financial inclusion, across four key stages – access, usage, security, and health – with the aim of informing the design of innovative solutions to empower people on the journey. 

It shows that by offering timely information and education to customers, Nubank was able to move them along the path from accessing gateway products—transactions-based accounts and prepaid/debit cards—to using credit and investment products. For example, it found 67 percent of prepaid card users went on to access loan products and 36 percent graduated to investment solutions. 

This “low and grow” approach to encourage usage eventually opened to offer higher-touch financial solutions that promoted customers’ financial security, health and wealth-building. Customers who built healthy habits by frequently using and regularly paying off credit cards were especially likely to go on to take up loan, investment, and insurance products.

TymeBank in South Africa provides another example of how to support the shift from access to inclusion. The digital bank has attracted millions of customers by offering formerly unbanked people access to debit cards within three minutes at digital kiosks in accessible locations like grocery stores. Once customers started using debit cards instead of cash for daily expenses, Tymebank’s banking app guides them towards credit solutions like MoreTyme, a ‘buy now, pay later’ product, which enables users to settle purchases in three interest-free installments.

Both these neobanks support customers on the financial inclusion journey by integrating financial education and behavioral nudges, like automated reminders, into the user experience. This complements other best practices to build trust, including simplifying onboarding processes, designing tailored user experiences, and engaging with customers personally throughout their journey.

New digital banking models will be showcased at the Alliance’s Annual Summit in London on June 4-5, where Alliance Hackathon winners—TymeBank, TRIBE Fintech, and LXME—will share tech-enabled strategies that support women on the path to financial and economic security. Join this and other discussions at the Summit to explore how we can build on women’s growing financial inclusion to unlock the full potential of the female economy.