Close the Digital Divide to Narrow the Gender Gap
Written by 2023 IMF/WBG Spring Meetings delegates Madison Savilow and Radia Mbengue
From financial literacy training to payment platforms and marketplaces, digitization is transforming the global economy for the better. However, our new focus on tech has created a digital divide, the unequal distribution of information and communication technologies in society, leading to another barrier to women’s financial empowerment. Particularly in low- and middle-income countries, women are disproportionately impacted by this disparity. Investing in digital public infrastructure could reshape the global economy while increasing women’s participation within it. A rising tide that lifts all boats.
With 2.7 billion people offline, it is no surprise that this was one of the main concerns discussed at the World Bank Group and International Monetary Fund Spring Meetings, which wrapped up last month. Economists, digitalization experts, and women’s rights champions in attendance sent a clear message: access to digital tools increases a woman’s ability to earn independently and safely.
Different demographics and regions have differing access to modern information and communications technology, including telephone, television, personal computers, and internet connectivity, but women are still less digitally connected than men; for instance, they’re 20% less likely to own a smartphone than men. While closing the gender gap is expected to be an intergenerational effort, the digital divide is a problem that can be solved in our lifetime. It is also a massive opportunity as connectivity increases human capital which, in turn, improves economic and social outcomes for generations.
With concerted effort to implement digital public infrastructure, all people, particularly women, can achieve the basic digital essentials, including owning a phone, having access to a bank account, and having a digital identification to access social services. These could equip women with the resources needed to start small scale businesses, better manage their finances, and protect their assets.
India is a prime case study for success in digital inclusion with an 80% increase in women’s financial participation over the past 6 years through investment into digital infrastructure throughout the country. Improved access had implications on the country’s social and environmental initiatives as well. For instance, digital access provided connection to services which allowed them to install 90 million clean cooking stoves - a climate solution with the global potential for 31.38 gigatons for carbon emission reduction by 2050.
Women and girls’ access to digital infrastructures has also been shown to improve their public participation by increasing access to education, one of the most powerful tools for economic, social, and environment prosperity. Having access to digital technology and the internet gives women the opportunity to use online learning tools, get better jobs and, therefore, further close the gender and wage disparity in their communities.
Digitalization can also have consequences in other fields. Health, including family planning, is a barrier for entering the workforce, and harassment and childcare are the key factors leading women to leave the workforce, with just over 50% of women participating in the labor market compared to 80% of men. Digital connectivity can, however, improve these statistics by providing online alternatives, such as support related to healthcare, family planning, harassment, and childcare. Women are also able to partake in remote work, giving them the opportunity to tend to family duties and reduce exposure to workplace harassment.
Implementing solutions for women’s financial success isn’t only about social justice; it’s an economic and environmental play as well. It equates to $5-6 trillion in economic growth globally, and fostering equality through family planning and education could reduce carbon dioxide emissions by up to 70 gigatons by 2050.
To unlock the benefits of women’s economic participation, there is an urgent need for financial institutions and governments, especially those advocating for gender equality to take critical steps to ensure women’s financial independence, autonomy, and resilience. Canada’s Feminist International Assistance Policy is an example of this initiative. Investment into digital public infrastructure is an effective and efficient approach.
Everyday, women around the world face multifaceted obstacles that prevent them from earning independently and providing for their communities. Increasing access to digital public infrastructure is a sustainable way to ensure women are economically empowered and equipped with the needed resources to face crises happening today and in the future.
