Introduction

This report examines the financial inclusion of young women aged 15-24 in low- and middle-income countries (LMICs). It provides a synthesis of lessons from various organisations that focus on improving young women’s access to financial services. The report also explores how financial inclusion can enhance young women’s financial knowledge, attitudes, and well-being, offering insights into effective strategies tailored to different life stages.

Chapter 1: Why financially include young women? Impact and business case

Financial inclusion plays a critical role in improving young women’s economic empowerment. With almost 600 million young women globally, 90% of whom live in LMICs, the report underscores the challenges they face, such as early marriage, childbearing, and limited access to education and employment. Less than 60% of young women in these regions have financial accounts, a gap that widens compared to young men during adulthood. Financial inclusion can help address these barriers by enabling young women to build savings, access credit, and participate in economic activities. For financial service providers (FSPs), serving young women can make business sense, as research shows that they are consistent savers and responsible borrowers, often exhibiting better repayment rates than young men. For example, Banco ADOPEM in the Dominican Republic reported better loan repayment performance among young women during the COVID-19 pandemic.

Chapter 2: Serving young women: A life stage approach

The report categorises young women into “Dependent” and “Independent” segments based on life stages, such as age, school/work status, and family role. Dependent young women, such as students or minors, have fewer financial needs and less control over resources, while independent young women, such as workers or mothers, tend to have more complex financial needs. Contextual factors like social norms and rurality also shape young women’s access to financial services. Financial strategies need to be adaptable to these segments, with dependent segments benefiting more from group-based savings and Independent segments requiring formal financial products like loans.

Chapter 3: The five components of financial inclusion strategies for young women: An overview

The report identifies five key components necessary for the financial inclusion of young women:

• Product design: Products should be designed to meet the specific needs of young women, including flexible savings accounts and small loans.
• Product delivery: Group-based mechanisms and digital channels are essential for reaching young women, particularly in rural areas.
• Financial capability building: Young women require financial education to build trust in financial systems, with digital financial literacy being a key focus for independent segments.
• Social intermediation: Engaging gatekeepers such as family members is crucial for Dependent segments, ensuring they can access financial services safely.
• Commercial viability: Although Dependent segments may take longer to become profitable clients, long-term relationships can make young women commercially viable for FSPs.

Chapter 4: Financially including young women

Products for young women should evolve with their life stages. Dependent segments often require informal savings products, while Independent segments benefit from a full suite of formal financial services, including credit and insurance. Delivery mechanisms should be tailored to each segment, with digital options playing a key role in reaching Independent young women, provided they have sufficient digital financial literacy.

Chapter 5: Monitoring and learning agenda

The report recommends that FSPs use both quantitative and qualitative data to track the impact of financial inclusion strategies on young women. For example, tracking account usage patterns can help FSPs identify when clients are ready to transition to more advanced financial products. Complementing data collection with interviews and surveys offers deeper insights into how interventions affect young women’s financial behaviour and well-being.