Article Preview
TopIntroduction
Over the past few years, the governments of developing countries have taken unprecedented steps towards providing financial services for the poor who reside in both rural and urban areas. Financial inclusion in areas such as microcredit policies tied with the rapid spread of mobile penetration and the launching of mobile financial services have been designed to reach the underbanked and unbanked segments of the population. This study was designed to scrutinize women’s experiences with microcredit in regard to empowerment and also to identify the status of branchless banking from the perspective of women clients. Before delving into an understanding of women’s empowerment, however, it is necessary to highlight why women have been disempowered (Aithel, 1999; Shaikh, Glavee-Geo, & Karjaluoto, 2017). Disempowerment is the process of reducing the authority of an individual to make crucial decisions and shape their own life. According to experts in gender studies, disempowerment arises from factors such as religious misinterpretations or patriarchal societies, and a lack of education, employment opportunities, and financial resources help its spread (Sinclair, 2012). We live in a patriarchy where male dominance prevails, and due to cultural and societal taboos, women are considered inferior to men despite the fact that they make up half of the population (Alshebami & Khandare, 2015).
Policymakers for gender equality and women’s empowerment have suggested financial inclusion for poor segments of society as a development intervention, and this has translated to microfinance becoming a growth policy. Microcredit, in particular, is considered to be an efficient tool for women’s empowerment and for the alleviation of the feminization of poverty because it is the provision of small loans to poorer segments of society. This financial opportunity transforms women’s lives in a positive manner, as when they invest in a productive activity, they can generate income that will be utilized for their family’s welfare (Addai, 2017; Bateman, 2011). However, in the local context of Sindh, the second largest province in Pakistan, women’s experiences have been unexplored with respect to how they transmute their lives after taking part in a microcredit programme and how they realize empowerment and meaning through it. The success of microcredit programmes could be further increased with the adoption of automation and digitalization in business and the delivery of financial services (Shaikh, Hanafizadeh, & Karjaluoto, 2017). In terms of the microfinance sector, the advent of mobile telephony in developing and developed countries can make payment systems convenient. In this sense, electronic payments (e-payments) and branchless banking channels are commonly known as alternate delivery channels (ADCs) (Shaikh & Karjaluoto, 2015, 2016).
Branchless banking is essentially the provision of financial services without any reliance on bank branches; it includes the use of technology and outlets like small retailers, who work as agents. It allows customers to initiate transactions remotely and is available for use by any customer without the requirement to have sizeable minimum funds carried in their account. Branchless banking examples include the use of mobile phones, automated teller machines (ATM), and Internet banking (Mulki, 2014; Shaikh & Karjaluoto, 2015). Pakistan’s banking sector is well established but insufficient to serve the rapidly growing population, and most people in remote areas have little or no access to formal banking services. Microfinance targets the population where banking is underdeveloped, and branchless banking, in particular, was introduced for this segment of the population because they live distant from services, in areas of low population density, where banking costs are high relative to income and the people are illiterate or have minimal education. The process begins with the client opening an account that is accessible through a mobile phone. Then, when cash is received by the client, it gets paid through the agent, who deposits the funds into the bank and sends electronic availability of the funds to the client (Abbassi, 2011).