The Cost of gender inequality: Microfinance provides hope.

A 2000 World Bank report pointed out stark realities of the costs of gender inequalities across the world. Mothers’ illiteracy or low level of education has negative impact on the nutritional status, Life expectancy and general welfare of children. For instance, child immunization by mothers’ vis-à-vis level of education in the Sub Saharan Africa for 1999 showed that only 25% of mothers with no education fully immunized their children. This figure rose to 45% for mothers with primary education and 78% for those with secondary education. Is it doom and gloom?

Microfinance particularly targeted at women provides hope in addressing gender inequalities across the world. There is a growing body of evidence of improved socio-economic development once women are empowered.

Historically, microfinance, in its form today has some of its roots and traditions in Africa: “…Community and member based as well as other informal financial institutions are exceedingly widespread throughout the world. In Nigeria for example, they date back to the 15th and 16th century from where they were carried by slaves as part of their social capital to the Caribbean, where both the institution and the original Yoruba term, susu, are still found today...” (Siebel, 2003).

Small loans and savings facilities through microfinance have empowered poor people particularly women to take more control of their lives and to participate more actively in the socio-economic development process in Africa.

With the support of multi-lateral and bilateral development partners as well as private investors, providing access to financing for income-generating activities, through microfinance organisations (MFOs) across Africa has reduced women’s vulnerability to poverty and also contributed toward addressing gender inequality and women empowerment. Furthermore, women empowerment has helped in addressing household poverty, particularly child poverty. Evidence indicates that where women have control over income a greater proportion of this is spent on nutrition, health and education of children.

According to the United Nations Capital Development Fund (UNCDF), “…women’s success benefits more than one person. Several organisations confirmed the well-documented fact that women are more likely than men to spend their profits on household and family needs. Assisting women therefore generates a multiplier effect that enlarges the impact of the organisations’ activities.”

Research in Zanzibar, Tanzania, found that “women’s increased income benefits their children, particularly in education, diet, health care, and clothing”.

Other recent examples of accumulated savings and credit associations (ASCAs) in Swaziland have demonstrated that microfinance services targeted at women have helped to improve the socio-economic lives of women and their families particularly children, those affected by HIV and the elderly. Women generally provide the primary care for children, those affected by HIV and the elderly. As such, targeted microfinance support for women has empowered them to help their children to attend regular schooling; to support their family members affected by HIV to adhere to anti-retroviral treatment and good nutrition, and to care for the elderly by providing access to nutritious food, clothing and medication for their better living.

What is needed, therefore, is a more concerted effort among stakeholders to scale-up the outreach of microfinance services to women – the impact of such support goes beyond the women themselves. They act as proper conduits for household and community empowerment.

Kennedy Lweya, PhD
Kuala Lumpur