Presented by:

Manar Korayem

Women Banking Champions

Program Lead

IFC EMENA

Cairo, 8 May 2017

EBI 9TH ANNUAL CONFERENCE

INNOVATION IN BANKING

SOLUTIONS FOR FINANCIAL INCLUSION OF WOMEN IN EGYPT

AN OPPORTUNITY TO SHARE AND CREATE VALUE

THE

EGYPTIAN

CONTEXT

“To be competitive and

productive, we need to find

skilled workers and talented

staff with the skills we need”

EGYPT’S PRIVATE SECTOR FACES CHALLENGES

Egypt’s businesses are telling us:

“We are fighting to keep

our existing customers

and find new ones”

To survive in the market, we need to

innovate and differentiate ourselves

from our competitors, offer different

products and target different customers

Customs

Taxes

Electricity

Forex

AT THE SAME TIME, BUSINESSES HAVE BIG GENDER

GAPS

Only 1 in 8 jobs in

Egypt’s businesses

is held by a woman

Only 1 in 14

companies in Egypt

is led by a woman

Only 1 in 6 borrowers

from banks in Egypt are

Female entrepreneurs

WORKERS LEADERS

Women represent 50% of Egypt's adult population, yet…

BANKING

CUSTOMERS

HOW DOES IFC WORK WITH COMPANIES?

STAKEHOLDERS

CONSUMERS

EMPLOYEES

SMES

LEADERS

Working with financial institutions

to serve the women’s market

Working with clients to train and coach

women entrepreneurs

Supporting clients in better managing

talent

Supporting clients in raising productivity of agribusiness

value chains

Supporting clients in increasing the

number of women on boards and in

management

Ensuring that investments create opportunities for men and women

Working with clients in measuring

gender impact

MEN AND WOMEN IN BUSINESS

IFC GENDER SOLUTIONS

WOMEN’S ACCESS TO

FINANCE

IFC’S BANKING ON WOMEN (BOW)

PROGRAM IN EGYPT

An opportunity to help financial institutions create value by serving the women’s market

US$ 260-320 billion

…is the estimated

amount of credit

demanded per year by

women-owned SMEs in

emerging markets – and

not met by financial

institutions.1

There is significant market

demand for financial services

for women business clients.

30% of registered

SMEs globally2

…have been created by

women.

Women entrepreneurs are

changing the landscape of the

global economy, creating

sustainable jobs and economic

growth.

870 million women

…will participate in the

economy for the first time

in 2020.

The female labor force grows.

Women who did not

participate in the economy

before will get a job or start

their own businesses in this

decade.

1/ IFC and McKinsey Enterprise Finance Gap Database2/ A woman-owned small and medium size enterprise (WSME) is, according to IFC,: (a) ≥ 51% owned by woman/women;

or (b) ≥ 20% owned by a woman/women; and has ≥ 1 woman as CEO/COO (President/Vice-President);and has ≥ 30%

of the board of directors comprised of women where a board exists.3/ She for SHIELD: Insure Women to Better Protect All; IFC, AXA, and Accenture 20154/ Harvard Business Review

85%..

…. of households identify

women as the main

decision makers in the

household.

US$ 20 trillion...

…in annual consumer

spending is controlled by

women. 4

GLOBAL CONTEXT

Women are driving the global economy

US$ 1.7 trillion...

…. is the estimated global

women’s market for

insurance by 2030. 3

6

• 40 banks licensed to operate in Egypt in May

2015

• Real GDP growth averaged 5.6% in the first

half of 2014/15

• Formal Bank account ownership is < 15% for

adults and just at 9.3 %

• The financial sector is a substantial driver of

the Egyptian economy

• However, lending to the private sector is

expected to outpace the rate of lending to the

government in the coming years

• 100% of individual loans and 90-95% of SME

loans granted in MENA by financial institutions

require some type of collateral – a specific

challenge for women-owned companies

• New CBE regulations issued to encourage

banks focus on SME sector.

• CBE became an active member of the Alliance

for Financial Inclusion, with clear commitments

for women financial inclusion

EGYPT CONTEXT

7 Source of Account Data: World Bank Group Global Findex 2016

OPPORTUNITY IN THE MIDDLE EAST AND NORTH AFRICA…

Unserved

Underserved

Well served

55-67 49-59 24-0

17-21

19-23

25-31

18-22 29-35 19-24

Very Small Enterprises (%) Small Enterprises (%) Medium Enterprises (%)

Source: IFC SME database, World Bank Enterprise Survey

US$ 50 Billion/year

Estimated credit demand for

women-owned SMEs

in MENA

US$ 72 Billion/year

for women-owned

Micro + SMEs

in MENA

Do not need credit

9

... 55% of women-owned MSMEs do not have access to credit,

and 63% of formal women-owned SMEs under-served by banks

Definitions: Unserved: Do not have a loan AND applied OR need a loan; Underserved: Have a loan but access to finance is a constraint; Well-served: Have a loan

AND access to finance is not a constraint; No need: Do not have a loan AND did not apply AND did not need

MENA

Women owned

MSMEs

Missed Business Opportunity:

Banks do not have specific value

propositions for women entrepreneurs,

professionals, etc.

Opportunity:

To integrate the

women’s market

into the existing

business model of

banks & FIs

20% 40% 28% 11% 32% 30% 30% 8% 21% 51% 18% 10%

WOMEN’S MARKET: OPPORTUNITY IN EGYPT

Source: IFC-McKinsey Study and World Bank Enterprise Survey

** Ready for Growth: Solutions to Increase Access to Finance for Women-Owned Businesses in MENA10

The next avenue for bank growth – market opportunity untapped ...

6.4 million

Total Number of Micro +

SMEs406,000

Formal SMEs

1

2

US$283 MillionEstimated credit demanded by

formal women-owned SMEs

US$246 Million Estimated potential deposit

needed by SMEs- owned by

women

Industry sectors of

concentration for

women-owned SMEs

10%

90%

40,000Formal, Women-Owned

SMEs in Egypt

(not including the agri

sector)

THE OPPORTUNITY: BANKING ON WOMEN

5

• Female customers have a higher propensity to save both as business & personal customers

• Deposits from female customers typically grow at higher rate and stay with the Bank longer

• Net funding surplus as a segment

• Provides source of market differentiation in competitive SME markets

• Establishes reputation as an innovator

• Entry and differentiation in specific sectors where concentration e.g. retail, mobile, youth

• Creates strong community-based advocacy and enhances corporate social responsibility

• Once main banker status achieved, higher cross-sell ratios (between 1 and 2 times)

• Higher footings obtained per relationship and higher fee generation

• Respond well to relationship management-based models

• Demonstrate stronger retention rates in many clients

• If a bank acquires the business relationship, high likelihood it will take majority of family wallet

• High advocacy creates strong conversion rates for husband’s business and personal finance

• Up to 85% of family financial decisions made by women globally

Market Share

Growth

• Female customers have higher risk awareness as both business and personal customers

• Women-led businesses outperform those led by men, including start-ups

• Stronger business plans can create higher acceptance rates and reduced processing costs

• Default rates are either the same or better than male counterparts depending upon market

Higher Cross-

Sell and

Loyalty

Strong Savings

Propensity

Positive Risk

Behavior

Linkage to

Family Wallet

Factor* Description

* Source: IFC Analysis

THE WOMEN’S MARKET: A BUSINESS OPPORTUNITY FOR BANKS

10

Data mining

& Customer

Analytics

Products / Campaign

Management

Organizational

Alignment

Branding /

Communication

Non-Financial

Advisory

Market insight

Research

• Build a separate

brand identity for the

women segment

• Mine database to

understand patterns in

behavior and establish

insights

• Tailor product offers to

meet the specific

behaviors of women

• Clear segment

ownership and

embedded in the

network for SCALE

• Include financial

education and

networking

opportunities as a key

part of the offering.

….Banks need to build capacity across 6 areas to serve women’s segments

13

Action Plan

BANKS NEED FOCUS ON 6 MAIN BUSINESS AREAS…

12

14

As at end-December 2016:

• Total Committed Portfolio: US$ 1.13 billion

• Total Number of Bank Investments: 38

• Total Number of Advisory Services Projects: 26

BANK INVESTMENTS IN

IFC BANKING ON WOMEN PROGRAM

Banco Internacional (Ecuador)

BFL (Laos)

BTPN (Indonesia)Chase Bank (Kenya)

Improsa (Costa Rica)

Banco Pichincha (Ecuador)

Rawbank (DRC)

(Romania)

Yes Bank (India)

TransCapital Bank (Russian Federation)

Banco Industrial (Brazil)

CDH (China)

SIB (Cote d’Ivoire)

(Turkey)

(Kyrgyz Republic)

Banco Internacional (Chile)

(Georgia)

Access Bank (Nigeria)

(Brazil)

DTB (Kenya)

(Turkey)

(Turkey)

(Vietnam)Acleda (Cambodia)

(Uganda)

(Tanzania)

IFC’S TRACK RECORD IN BANKING ON WOMEN

IFC HAS A STRONG TRACK RECORD OF PROVIDING INVESTMENT AND ADVISORY SERVICES TO 42 BANKS

TO BUILD PROFITABLE BUSINESS LINES IN THE WOMEN’S CUSTOMER SEGMENT

SUCCESSFUL IFC PARTNERSHIPS IN “BANKING ON WOMEN”

15

HBL Bank,

PakistanBLC Bank,

Lebanon

Gender Intelligence led to:

8% more account opening

Gender Intelligence led to:

18% of total bank revenue

16

…… BUT THIS IS NOT ALL

We aim for a Cultural, Social, Legal and Policy

#SheKtirMhem

DISPELLING THE MYTH

Unconscious

Bias Discrimination

Gain insights into gender biases that influence attitudes and behaviors

Thank You