INSIGHTS: Investing in innovative research approaches to understand and address barriers to financial inclusion for women

Like many of women across Africa, Judith Laokwali, from the Kano region in Northern Nigeria, runs her own small business as a fashion designer, making clothes for customers in her community. However, due to limited access to finance, given her remote location and scant penetration of banking services, she sometimes experiences challenges with customer payments. Additionally, her community’s social and cultural norms can limit interaction with men, restricting her income opportunities.

Overcoming the barriers that limit access to digital solutions for millions of financially excluded women, youth, rural dwellers and small-business owners can boost their financial inclusion and economic participation in their communities.

ADFI has been investing in innovative research approaches such as human-centred design (HCD) to gain understanding of the barriers to access and use of digital financial solutions. This approach places participants at the centre of the process, co-creating responsive and inclusive products and services relevant to the last mile. Intentionally designed to be appropriate, affordable and accessible, these solutions provide some of the most powerful tools to build resilience, mitigate risk and achieve their potential, particularly for those who have been marginalised.

Y'ello Digital Financial Services Ltd, a fintech subsidiary of MTN Nigeria Communications Plc, used human-centred research to develop a gender-focussed network of women mobile money (MoMo) agents that can overcome barriers, including cultural and social norms, to access for women customers. 

Becoming a MoMo agent, she said, “will help me boost myself with my customers. If they say they want to pay with money, I will have ways for them to withdraw … and not for them to tell me that the transfer is not working, and they should go to another place.” 

For Judith, her participation in this research has informed MTN Nigeria's development of female mobile money agent networks that can help enable women to access digital financial solutions, while overcoming cultural and social norms that limit contact with men. Becoming an agent also means her earning potential could increase. The project generated evidence-based insights that can inform more inclusive financial sector policies, regulatory reforms, and gender-sensitive market strategies. 

DEVELOPING CREDIT SOLUTIONS THAT MEET THE NEEDS OF WOMEN SMALL BUSINESS OWNERS

ADFI awarded a grant of USD 300,000 to M-KOPA to explore and respond to the needs of women small business owners to build resilience and growth. 800 men and women took part in the HCD research process to assess barriers to and the feasibility, desirability and viability of digital credit solutions for women informal traders to strengthen and grow their businesses via credit-secured, pay-as-you-go smartphones combined with other data as collateral.

“I would be happy if credit solutions could be specifically tailored for women.  Additionally, cash loans to women’s informal savings and investment groups (chamas) would be uplifting, as when our husbands' income is low, we'll be there to help.” Zipporah Sanga, Eldoret region in Kenya

Findings from this research have confirmed that women small traders face issues with high-interest rates and fixed-term repayments as their cash flow is unpredictable. In addition, they are seeking larger loan amounts to be able to effectively invest in growing their business or starting a new one.

M-KOPA has deployed over USD 2 billion in credit to 7 million total customers, with women making up 40% of active customers and 45% of its agent network. 81% of female customers stated they could not have afforded a smartphone without M-KOPA. The ADFI HCD work in Kenya directly informed a product model that has since attracted IFC, Gates Foundation, and BlueOrchard investment — a clear multiplier from early grant support.

EMPOWERING WOMEN SMALLHOLDER FARMERS THROUGH BUNDLED DIGITAL MICROINSURANCE

Human centred design research informed responsive microinsurance for women smallholder farmers in Kenya, Nigeria and Zambia, resulting in the registration of over 1.5 million farmers of which 50% were women, which has risen to 3.7 million to date (including 50% women). ADFI awarded a grant of USD 1 million to Pula Advisors to explore and respond to women’s insurance needs and the social, cultural and economic barriers limiting their access.

Participative qualitative and quantitative research studies were carried out with

• Kenya: 239 women smallholder farmers & 13 agro-dealers
• Nigeria: 480 women smallholder farmers
• Zambia: 253 women smallholder farmers & 12 agro-dealers

Products/Services Developed: Insights from the research informed the development of bundled gender-centric insurance products (Area Yield Index and Weather Index Insurance) embedded in seed and fertiliser packages, with digital farmer registration and agronomy delivery via SMS and WhatsApp.

Agronomy Tips, Fertiliser & Seeds: Pula delivers individualised agronomy tips via SMS using satellite and ground data. Their data shows bundling insurance with agronomy advice increases farm investment by up to 16% and yields by up to 30%. In Zambia, insurance premiums are embedded directly into fertiliser and seed packages.

“We are very happy knowing that whenever we face disasters, there is insurance to help us.” Woman smallholder farmer, Mambwe District, Zambia

The findings fed directly into a product model that has since attracted funding from BlueOrchard, Gates Foundation, and Women's World Banking. In 2024, Pula executed Africa's largest agricultural insurance payout — over 800,000 Zambian farmers received USD 29 million after severe drought.

For more information on the ADFI-supported HCD projects, please visit ADFI projects