This blog post originally appeared in Spanish on the Inter-American Development Bank website.
In their recently released 2019 annual letter, Bill and Melinda Gates argue that data can be sexist. Missing or inaccurate data on women and girls can block their progress and that of society and economic development at large, they state, since robust gender data has the power to encourage change to achieve greater gender equality.
Due to an overall lack of high-quality data on women and girls (“gender data” as we call it), there are few documented cases where such data has shaped public policy and yielded clear benefits. This has been a challenge in the financial sector since the gap in data about women’s financial inclusion (defined as access, usage and quality of financial services for women) remains large, despite its value.
However, Mexico is a notable exception. Indeed, we document the data-to-policy-to-results link and detail how Mexico used gender data to shape public policies in a recently-published case study that we wrote in the context of the Women’s Financial Inclusion Data Partnership, coordinated by Data2X. It also highlights insights and trends in financial inclusion that only rich data sets can provide.
For instance, the proportion of adults in Mexico with access to at least one formal financial product (for example, savings, credit, insurance, or retirement fund) increased more for women (from 52% to 65%) than for men (from 61% to 72%) between 2012, when this data began to be collected, and 2018. In this same time period, and the gender gap in access shrunk, from 8 percentage points in 2012 to 6.6 percentage points in 2018. These numbers come from demand-side data, which Mexico has collected every three years since 2012 through a National Financial Inclusion survey which obtain access and use information directly from individuals.
Similarly, of the 94.7 million bank accounts in Mexico as of March 2018, 50.5% were held by women. Women make up the majority of customers of national development banks (they hold 81% of accounts), banks that manage accounts of social program beneficiaries (they hold 93% of the accounts at Compartamos), and commercial banks in lower per capita income states (they hold 53% of accounts in Tlaxcala and Oaxaca), while men are the majority of account holders in commercial banks (52%) and in higher income states. These numbers come from sex-disaggregated supply-side data provided by administrative records from banks and other financial sector providers.
In Mexico, gender gaps evident in the demand-side data triggered the collection of sex-disaggregated supply-side information—both sets of data are complementary and together give the full picture of the state of financial inclusion—and policies to address these gaps. For instance, a documented gender gap in retirement savings (only 33% of women versus 50% of men reported having retirement savings in 2015) motivated government programs to promote retirement savings, including formalizing domestic workers (the majority of whom are women) and providing them with pension benefits and insurance.
Women’s prevalence as customers of development and commercial banks in low income states is partly explained by the government’s massive conditional cash transfer program (Prospera) which in recent years has opted to transfer the monthly cash subsidy to women in the beneficiary households through bank accounts. The supply-side data points this out and highlights a new challenge now that the gender gap in bank account holding has closed: the need to expand women’s access to other financial products, such as credit, savings and insurance, in addition to commercial bank accounts.
One obstacle women in Mexico continue to face is lack of collateral (the 2018 demand-side survey revealed a gender gap of more than 20 percentage points in asset ownership in men’s favor). Mexican Fintech companies can help address this by using Artificial Intelligence (AI), alternative data, and predictive algorithms to qualify women for loans as a substitute for traditional collateral.
It might seem obvious that most countries should have financial inclusion data that is sex-disaggregated like in the case of Mexico; however, few countries do. In fact, Mexico is one of the few countries in the world where supervised financial institutions must report sex-disaggregated data to the regulator. More broadly, we found Mexico used legislation, regulatory leadership, inter-institutional collaboration (between government agencies and private sector banks) and data as engines of change, and this change built on an evidence-based policy culture, strong gender equality policies and advocacy, and solid statistical capacity. Many of the enabling elements described in the Mexico case study offer lessons to countries in the region and elsewhere.
Mexico is proving that when sex-disaggregated financial sector data makes women visible, this gender data strengthens Mexico’s financial sector and improves women’s lives.