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Financial inclusion in Egypt: Why Egypt’s banks are supporting women

Women represent more than half of the labor force, but their bank transactions are only 10%. Banks believe financial inclusion in Egypt is key.

The Central Bank of Egypt is ramping up its support for women, particularly under-served women in rural communities.

Working with banks operating in local markets, CBE aims to boost the loan portfolios of banks in the nation to women who need micro-loans.

On Sunday, CBE is poised to sign an agreement with the National Council for Women and the 50th Forum, which includes the 50 most influential women in the Egyptian economy, to launch the “Women Leading the Future” program.

The Women Leading the Future program is especially popular with local banks and female leaders in various economic sectors.

The program aims to identify women qualified to take on leadership positions in various sectors of the country, in the spirit of breaking barriers for entry in all political, economic, and social fields.

According to Lubna Hilal, deputy governor of the CBE, this agreement is part of the central bank’s focus on the economic empowerment of women through credit grants and training.

All of the parties involved in the programme will form joint working groups to come up with the content of the training programme and provide new strategies to teach future generations of women how to lead.

Egypt’s future relies on strong female leaders

Niven Al-Misiri is the CEO and managing director of Ahli United Bank-Egypt. As a female leader in her own right, Al-Misiri sees the future of the bank and the nation as tied closely to the development of the female talent pipeline.

Al-Misiri adds that Egypt has many promising women in the workforce who can contribute to the development of the state and society.

According to Al-Misiri, Ahli Bank aims to raise financial awareness among Egyptian women as part of its plan to hone them for leadership. The move is based on the strategy and values of the parent group in Bahrain, which has played a huge role in boosting financial inclusion in the region and promoting gender equality in employment.

Financial inclusion in Egypt

According to Al-Misiri, exposing Egyptian women to financial culture is the first step to positively change the organizations they work for, and society as a whole.

Several banks operating in Egypt told local media that women cuurently have a large share of their loan portfolios, especially microloans.

El Sayed El Kosayer, the chair of the Egyptian Agricultural Bank, believes financial inclusion will raise the living standards of women, which is a crucial element to empowering them in society. It also helps increase household income, which has a positive effect on reducing child labor since Egypt has a large number of households where women are the sole breadwinners.

Egyptian Agricultural Bank has a number of initiatives aimed at the economic empowerment of women. The bank is the second largest lender to the Mashrouk program, a joint initiative with the Ministry of Local Development, the National Bank of Egypt (NBE), Banque Misr, Banque du Caire, and the Housing and Development Bank. 30% of the customers in the Mashrouk program are women who benefit from flexible financing.

The bank has also launched the “Bent Misr” programme to finance female breadwinners, particularly in the Nile Delta and Upper Egypt.

Egyptian Agricultural Bank was also the first to launch an independent financing scheme for women, which helps female entrepreneurs with favorable terms and conditions for micro projects in rural sectors, from livestock breeding to bread production.

These loans range from EGP 1,000 to EGP 10,000, while the maximum funding for groups of at least three people amounts to EGP 25,000 over 12 to 24 months.

Female breadwinners account for a quarter of Banque du Caire’s microloan portfolio, totaling EGP 12 billion.

The bank plans to increase the income of female entrepreneurs to improve their standard of living in the coming years.

Similarly, Nasser Social Bank (NSB) allocated EGP 250 million to support female entrepreneurs. The bank received the funding from the Tahya Misr Fund and will be re-lent at 5% interest rate.

Transactions by women still proportionately low

Women make up more than half of Egypt’s human labor force, but their banking transactions are only around 10%, says Ashraf El Kady, chairman of United Bank. He says this is mostly because of social and economic reasons.

One of the most important barriers to financial inclusion is that women are still not economically independent in different areas in Egypt. Many are part of the informal economy, which needs to be tackled through economic integration, he says.

Unemployment among women amounts to 44% compared to 30% among men under 30 years of age, he adds, which compounds the problem. Getting women into the workforce is another challenge El Kady believes the nation needs to tackle.

Women account for 70% of the total microloans provided by banks, companies, and NGOs, roughly equating to EGP 7.8 billion as of September 2017.

This according to Mona Zulfikar, chair of the Egyptian Federation of Microfinance, who adds that almost 100% of women repay their loans regularly. This untapped demographic are more likely to meet their obligations, and is a vital part of Egypt’s economic success.

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