Women's Economic Opportunity Index - Economist Intelligence Unit

Appendix IWomen’s economic opportunityA new global index and ranking66. “UK Government: NextSteps for Post Office BankingAnnounced”, M2 Presswire,March 29th 2010.67. J Toledano and J Ansón(eds.), Postal Economics inDeveloping Countries: Posts,Infrastructure of the 21stCentury?, Universal Postal Union:Berne, 2009.68. World Bank. (2006), op. cit.69. “Egypt Post RemittancesVolume Reaches 2.5 Billions”,http://www.egyptpost.org/en/NewsDetails.asp?NewsID=164(accessed May 5th 2010).70. Egypt Enhancing Accessto Finance for Micro and SmallEnterprises, World BankProject Appraisal Document,February 9th 2010. http://web.worldbank.org/external/projects/main?pagePK=64283627&piPK=73230&theSitePK=40941&menuPK=228424&Projectid=P116011 (accessed May5th 2010).accounts in less than five years (see below for more details). The interest in post-office banking is notjust from developing countries. The UK recently announced an expansion of the financial services offeredby its Post Office to improve the supply of credit to low-income households, to serve small and mediumsizedenterprises (SMEs) better, and to make the Post Office network of 11,500 branches more financiallysustainable. 66Although post offices have been offering financial services for many years, the concept of using abricks-and-mortar network to increase access to savings and loans has been sidelined in recent years bythe microfinance movement, and the use of new technology such as mobile banking. However, severalsuccess stories show that the post office may be an effective tool to bring financial services to the poor.The Brazil example is instructive. Starting in 2002, Brazil set up a special postal financial servicethrough the Brazilian post that acts as a correspondent for a private bank (Bradesco). Taking advantage ofthe experimental conditions provided by the gradual opening of postal bank branches in Brazil, an impactevaluation was done. It revealed clear and positive effects between the opening of postal bank branchesand new-firm creation and employment. 67 In a four-year period (2002-05), the involved municipalitiessaw an average of 20 additional new firms per municipality compared with peers without Banco Postal(after controlling for regional differences and specific levels of financial access). Interestingly, thepresence of Banco Postal also had positive effects on formalisation of the labour market. On average,municipalities that were initially unbanked experienced relatively more growth in the proportion ofsalaried workers than the municipalities that did not benefit from a Banco Postal launch in 2002.In Egypt in 2002, 50% of savings accounts were held at post offices—although these accounts heldonly 3% of total national deposits—and handled 22m payment transactions (compared with 8m by banksin Egypt). 68 In terms of potential for increasing financial inclusion, however, the post office has widecoverage in many of Egypt’s poorest villages, through its more than 3,000 outlets, and is accessible tolow-income households. When Egypt Post introduced remittance services in 2007, this service saw largecustomer take-up, as remittances are a main source of income for rural villages with relatives workingabroad. 69 A new World Bank project aims to use the country’s network of post offices to expand theavailability of credit to micro and small enterprises across Egypt. 70 An innovative element of this projectwill be a new financial product line designed and targeted at disadvantaged women in the country’spoorest 1,000 villages. This will operate through the new post-office-facilitated expansion of creditservices.Most financial services delivered at post offices are not specifically targeted at women, but the fact thatthese services are being offered in locations relatively close to their home may make it easier for women,especially women in rural areas, to access, as they may have more limited geographic mobility than men,owing to greater household and childcare responsibilities, less cash available for transportation needs,and less knowledge of financial institutions and services.Further ReadingA Demirguc-Kunt, T Beck and P Honohan, Finance for all? A World Bank Policy Research Report: Policies andpitfalls in expanding access, World Bank: Washington DC, 2008.115 Economist Intelligence Unit 2010