Banking on Women?

Are women-only banks an empowering move, segregation or bank saviours?

As over half of banks’ worldwide clients are female, no wonder that many international banks have turned their focus on this lucrative market, claiming that women have been marginalised for long enough and it is time to recognise women’s role in the economy. But is women-focused banking all about women’s rights and well-being or is it pure capitalist greed for profit? The wealth gap between men and women is narrowing: some research suggests that 53% of millionaires are likely to be females in 2020.

In 2001, Dubai Islamic Bank was the first in the Gulf region to launch women-only branches in the UAE, acknowledging women’s needs and rights to have control over their finances especially since they were encouraged to play an active role in the workforce of the country.

There are several women-only products in the UAE:

Dubai Islamic Bank: Johara operates in nine branches across the UAE. Run by women for women, these female friendly branches offer the same services and accounts as other branches, including financial consultancy.

Emirates Islamic Bank
Al Reem is an account specifically for women available in all of the bank’s branches. Account holders receive points-related benefits and dedicated women-only queues.

ABN Amro, a Dutch Bank
The Al Ameera credit card works on a points reward system that women redeem in places such as at Dubai’s Wild Wadi water park on women-only days.

Citibank followed suit by opening branches that are devoted to women, only after losing widowed female customers.

Such branches allow women to feel more comfortable, their needs attended to by other professional, well-qualified and sympathetic women. In the Arab Muslim world women may not have joint accounts with their husbands, but they have every right to accounts of their own subsidised by their husbands. Also, many women, in the Gulf particularly, have wealth in their own right, so it doesn’t come as a surprise to find banks that are dedicated to looking after women’s finances in a safe environment which reassures male guardians. Everyone is a winner: the banks, the husbands and the women.

Elsewhere, with the introduction of the euro, Raiffeisenbank Gastein’s currency exchange business broke away in 2002, leaving a large, unused space.

The banking consultancy Emotion Banking was called in to drum up ideas on how to use the space and increase local business. It found that while 13% of women in the Austrian Gastein valley were self-employed and required high-level banking strategies, 50% percent were housewives with more basic banking needs. The consultancy devised a strategy to target the wealth of opportunity among Gastein’s women, and “female-banking” was born.

The branch includes a lounge-like interior that includes a play area to keep children occupied. Female employees assist customers, and build a strong relationship with their customers.

Austria might be the first European country to conclude that women’s approach to money is different from that of men. However, the concept isn’t altogether new on an international scale.

Leading the way are banks for women in Islamic countries. Microcredit providers like Grameen Bank, established in 1976 when Bangladeshi Professor Muhammad Yunus, a winner of the Nobel prize for peace, realised the importance of empowering women by providing them with loans to start their own businesses. Yunus’s long-term vision is to eliminate poverty in the world. That vision cannot be realised by means of microcredit alone. But Muhammad Yunus and Grameen Bank have shown that, in the continuing efforts to achieve it, microcredit and supporting women must play a major part.

http://www.grameen-info.org/index.php?option=com_content&task=view&id=388&Itemid=

In Pakistan, First Women Bank was founded in 1989 and strives for the economic empowerment of women. However, apart from its president and chairman, there are only a few females amongst its top management.

Saudi Arabian women, although still restricted in terms of driving cars, do have the right to control their own finances, and Saudi banks have been devoting extensive resources to ‘ladies banking’, with separate entrances, distinct product offerings and a staff consisting entirely of women. In 1980, Saudi Arabia National Commercial Bank opened two women-only branches in Jeddah and Riyadh. A few years ago the bank opened a VIP centre for women who hold accounts of over £200,000.

In Saudi Arabia, thirty percent of accounts worth nearly £4.72 billion, are opened by women, and women control 21 percent of the country’s private investments and a fifth of all Saudi mutual funds. Some estimates by local portfolio managers say up to 60 percent of new stock investors and 40 percent of new real-estate investors are women.

Masrafy women-only Bank was established in 2006 in the financial hub of Bahrain in the Arabian Gulf. Studies and statistics from the region showed that women in the region have funds worth £24.91 billion and there were no credible investment avenues to maximize returns from investing these funds in a professional manner. Masrafy aimed to bridge this gap.

Mujer Banorte is one of the biggest banks in Mexico that target women. Services including insurance for illnesses common to women, such as cervical cancer.

According to this website http://trendwatching.com/trends/femalefever.htm all staff at Standard Chartered Bank’s Jodhpur Park branch in Kolkata, are women—down to the security guards, and unlike the guards in the ladies-only Dubai Islamic Bank whose guards are males to make sure they can deny entrance to any male intruders.

And though men won’t be driven away, the purpose behind opening the branch is to attract more women customers. The launch of the branch was based on customer feedback which indicated that female customers would prefer a ‘non-inhibiting’ environment. On the cards are workshops for women on financial planning and investments. Particular efforts are being made to provide information related to investments, and the concept will also be taken to other Indian cities.

In Kenya, Equity Bank is about to open women-only bank branches. The initiative will receive a USD 75 million cash injection from the United Nations Development Programme.

North American banks are also addressing women’s needs. Just two decades ago, it was commonplace for a female entrepreneur to have to get her husband to co-sign a loan, according to the Royal Bank of Canada (RBC).

Dundee Bank created a bank in Nebraska (http://www.dundeebanking.com ). Everything about it was designed around the needs of women. In the US, women spend 81¢ of every dollar. And in the vast majority of households, women handle the check book and make the banking decisions. It only makes sense to focus on women’s needs. Research showed that women desire convenience most of all, are more appreciative of little details, and want a solution-based bank. They also are more likely to own or start up a small business. Dundee Bank doesn’t exclude men. It just focuses on the needs of an important and core audience.

UK banks were among the pioneers of women-focused banking over 10 years ago, but other countries worldwide are moving further ahead now, according to the wealth management consultancy Scorpio Partnership. Which is a shame in a financial hub such as the UK.

For the Dutch bank ING, 95% of the target users of microfinance were women, though some commentators have seen little advantage to this sort of targeting in a country like Holland.

However, the UK Coutts private bank “aims to create a culture that fosters female entrepreneurship”, said Sarah Deaves, who became Coutts’ first female chief executive. A spur for the bank is the growing number of rich women in the UK. About one-third of Coutts’ six thousand clients are women. What started as a small lunch programme two years ago has grew into networking events, charity fundraisers and the launch of Coutts Woman online magazine.

The atmosphere might be very relaxed for some women; however, the more important point is: do these banks provide extra or different benefits to women in the hard core of banking or it is just an accessorized service to keep female customers indoors by making them feel privileged. Would a female widow receive extra interest on her husband’s pension, for example?

Please share your views with us here. Would you prefer women-only banks? How do you perceive this service?

Suhad Jarrar-Browne

Education Consultant on Higher Education, Middle East and Gender Issues

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