Why financial literacy for women and youth matters
If women participated in Africa’s economic activities to the same extent as men, the continent’s GDP would increase by 25%, or $8 trillion annually. But for women, as well as Africa’s burgeoning youth population to become economically effective, it is essential that they become financially literate. Elisa Desbordes-Cisse, Chief Operating Officer, Ecobank Foundation, and Florence Raes, Deputy Regional Director, UN Women West and Central Africa Office, look at how this can be achieved.
The economic empowerment of Africa’s youth and women is probably the main enabler of achieving most of the sustainable development goals, especially the targets for zero poverty, zero hunger, gender equality, decent work and economic growth and reduced inequalities. This is why Ecobank Foundation and UN Women have joined efforts to strengthen their respective agendas for promoting women’s empowerment in Africa.
At Ecobank, giving back to the communities in which the Bank operates is embedded in the DNA of the Group. For the past nine years, through the Ecobank Foundation, Ecobank’s employees have participated in “Ecobank Day”, an annual event where they serve the wellbeing of their communities.
This year’s Ecobank Day, which took place on 12 November, focused on financial literacy and inclusion as a key factor in reducing poverty and promoting shared prosperity for women and youth, mostly in marginalised communities, with the theme “Leave no one behind: Financial Inclusion for all!”.
Through this partnership with UN Women, particular attention has been paid to the specific needs and challenges faced by women and women entrepreneurs in both rural and urban areas in this year’s Ecobank Day.
The Ecobank Foundation and UN Women will also jointly carry out a series of awareness raising, advocacy and action activities to combat violence against women and girls in several African countries in conjunction with the international 16 Days of Activism Against Gender-Based Violence campaign starting on 25 November.
Economic empowerment is the transformative process that allows youth and women to move from limited power, voice, and choice at home and in the economy to having the skills, resources, and opportunities needed to compete equitably in markets.
When more women work, economies grow. Women’s economic empowerment boosts productivity, increases economic diversification and income equality in addition to other positive development outcomes.
If women participated in the economy identically to men, it would add up to $8 trillion, or 26%, to annual African GDP in 2025 compared with a business-as-usual scenario.
With more than 60% of Africa’s population under the age of 25, ensuring that all young people, including the most marginalised and disadvantaged, can unlock their potential through access to education, training and then decent jobs will boost the economies. It is particularly relevant for Africa where the Fourth Industrial Revolution and the rise of the digital economy offer unprecedented development opportunities.
Microfinancing and the development of different financial products tailored for women and youth have – to some extent – improved the access to finance of many people across the continent, allowing many of them to start or improve their business. Which is a great news! But how to ensure that the economic gains last?
To quote South African actress, Pearl Thusi, in the 2022 documentary I’ve Been Trying. Eight Years Without a Job’ “If we really want young people to effectively engage in business activities, it’s important to provide knowledge like financial literacy”.
Financial literacy is the ability to understand and effectively use various financial skills, including personal and business financial management, budgeting, and investing. It is the ability to understand how money works. It is the ability to make sound financial decisions.
Financial literacy is essential
Because women are more inclined to invest in the wellbeing of their children and family, it is crucial they gain the financial knowledge they need to do so. Financial literacy is, therefore, central to reducing poverty and boosting prosperity.
We all face moments in our life when we are forced to stick to a stricter budget. When we are financially literate, we are enabled to be better prepared and more resilient when the next crisis comes along.
How to ensure women and youth have this knowledge? By finding creative ways to make financial literacy more inclusive and accessible while also removing the stigma attached to discussing personal finance. The same way that people are taught to read, write and count, they should learn how to budget and save.
That is the reason why we strongly believe that financial literacy should be the cornerstone of financial inclusion programme. By doing so, women and youth, mostly in marginalised communities, can be empowered to make sound financial decisions that will change their lives and those of their families in the long run.
Through this approach of financial inclusion, no one is left behind.
Elisa Desbordes-Cisse is Chief Operating Officer, Ecobank Foundation
Florence Raes is Regional Director ad interim and Deputy Regional Director, UN Women West and Central Africa Regional Office