Financial Inclusion Insights

📊 Exciting new research from the European Central Bank (ECB) sheds light on how banks are pricing climate risk in their lending practices! 🌿 In their working paper, Carlo Altavilla, Miguel Boucinha, Marco Pagano, and Andrea Polo combine euro-area credit register data with carbon emission information to uncover fascinating insights into the intersection of finance and climate change. 🏦 The study finds that banks are indeed factoring climate risk into their lending decisions. Firms with higher carbon emissions face higher interest rates, while those committed to reducing emissions enjoy lower rates. Interestingly, banks that have publicly committed to decarbonization goals (through initiatives like Science Based Targets initiative) are even more aggressive in this pricing strategy. 💶 But here's where it gets really intriguing: the researchers uncovered a "climate risk-taking channel" of monetary policy. When the ECB tightens monetary policy, banks not only increase their overall credit risk premiums but also amplify their climate risk premiums. This means that during periods of monetary tightening, high-emission firms face a double whammy of increased borrowing costs and reduced access to credit compared to their greener counterparts. The authors argue that while restrictive monetary policy may slow down overall decarbonization efforts, it inadvertently creates a more favourable environment for low-emission firms and those committed to going green. 🌍 These findings are crucial for understanding how the financial sector is adapting to climate change and how monetary policy interacts with climate-related financial risks. It's also clear that the greening of finance is not just a trend, but a fundamental shift in how risk is assessed and priced in our economy. #ClimateFinance #SustainableBanking #MonetaryPolicy #ECB #GreenEconomy #ClimateRisk

When Moms First was starting out, a lot of people asked me: Why moms? Why not all parents? This is why: https://lnkd.in/eh3gqwPm ------ "This month, the U.S. Census Bureau published a bombshell finding: The gender wage gap just got wider for the first time in two decades ‒ with women now earning just 83 cents to a man’s dollar. That’s maddening. But, for moms at least, it’s hardly surprising. It’s next to impossible to balance work and family in this country ‒ and as this new data shows, women are taking the hit. As the cost of child care continues to soar, women will just keep falling further behind. On paper, there’s no reason to believe that women should be earning less than men. Girls are more likely to graduate from high school and more likely to hold a bachelor’s degree. More women than men go to law school and medical school, and women’s enrollment in MBA programs has reached record highs. In fact, women do earn nearly as much as men ‒ at least early in their careers. On average, women in their late 20s and early 30s are much closer to parity, taking home at least 90 cents on the dollar compared with the guys sitting next to them at graduation or new hire orientation. Then, when women hit their mid-30s, something changes. The pay gap gets wider. It’s no coincidence that that’s precisely when women are most likely to be raising kids. All of a sudden, women are forced to make very hard choices to manage the demands of work and family. As the founder of Moms First, I’ve heard versions of this story from more women than I can count. Maybe mom drops down to part-time so she can make it to school pickup. Or maybe she switches to a new job that pays less but offers more flexible hours. Or maybe she drops out of the workforce entirely, because the cost of day care would have outpaced her salary anyway. Make no mistake, we are talking about moms here. When women are paid less than men anyway (and, in the case of Black and Hispanic women, way less), deprioritizing their careers can feel like the only logical decision, even if it isn’t what they wanted. This creates a vicious cycle, where pay inequity begets more pay inequity ‒ and women are systematically excluded from economic opportunities. At the same time, while women experience a motherhood penalty, men experience a fatherhood premium ‒ working more hours and reaping bigger rewards than those without kids. As Nobel laureate Claudia Goldin put it, when describing her pioneering research on the pay gap, 'Women often step back, and the men in their lives step forward.' Because here’s the thing: The 'choice' to step back from the workforce isn’t much of a choice at all. If grandma isn’t around to pitch in and child care costs more than rent, what other option do you have?"

India just did something that should have taken 47 years in 9 years. 561.6 million people gained bank accounts through Jan Dhan Yojana since 2014. That’s nearly 1.5 times the entire US population brought into the financial mainstream. Most countries take half a century to do this. Anil Padmanabhan something that stopped me cold. Here’s what makes this unprecedented: ↳ Stats that demand attention: • Gender gap in account ownership: 17% → 6% in just 6 years • Education divide collapsed from 29% → 10%• Rich-poor banking gap narrowed from 14% → 5% • ₹38.49 trillion transferred directly to citizens via JAM trinity • 116 million retail investors on NSE, 72% from tier-II/III towns ↳ Three insights reshaping financial inclusion: 1/ From access to empowerment The real challenge isn’t opening accounts—it’s transforming savers into investors. 561 million people now have economic identity, but only 4.2% are truly financially literate. Infrastructure creates leapfrogging 2/ JAM trinity (Jan Dhan + Aadhaar + Mobile) became economic GPS. It saved ₹3 trillion by eliminating middlemen while restoring trust in government welfare. 3/ Inclusion without literacy creates vulnerability India’s retail investing boom is exciting but dangerous. Millions entering markets without capacity to navigate volatility. Financial inclusion 2.0 must prioritize education. ↳ my take after 20 years in this industry What India achieved defies every textbook on financial inclusion. As Anil notes, countries typically need per capita income to rise from $5,000 to $20,000 over 47 years to reach this scale. India did it with incomes rising only from $1,500 to $2,700. The secret wasn’t just tech—it was reimagining the social contract. JAM how 500+ million people relate to the formal economy. But here’s the catch: access without financial literacy is like giving someone car keys without driving lessons. But the story everyone’s celebrating has a massive blind spot. That’s why my co-authors Ayush Tripathi and Soham Jagtap and I wrote “Ushering into the New Era of Financial Inclusion: Enabling Women and Women-Led Organisations.” last year ↳ What our research revealed: • Women make up only 32.8% of India’s workforce vs 47% globally • Despite being nearly half the population, women contribute just 17% to GDP compared to 37% worldwide •Women receive credit equal to just 27% of their deposits, while men get 52% • Only 10% of women are borrowers compared to 15% of men The infrastructure is built. Now comes the harder part—ensuring these accounts become instruments of wealth creation, not just welfare delivery; the women become employment drivers and borrowers not just subsidy recipients. Which other emerging markets do you see balancing rapid financial inclusion with financial literacy? What lessons can others learn from India? (link to the articles in the comments)

It’s nearly 2025, please stop telling me there’s no gender bias in investment. Here are the facts from 2024: → Firms founded by women received only 1.8% (£145m) of all equity investments in the first half of the year. → That’s a decline of 2.5% compared to the same period last year, so things are getting worse, not better! → The root cause of this is a systemic bias and money not being in the hands of enough women, with only 12% of fund managers in the UK being female. Multiple studies show female-powered businesses generate 35% higher returns than male-led businesses. Not investing in women isn’t just costing investors greater returns but also creating a £250bn hole for the UK plc. If we don’t invest in women, we all lose!

“If she’s left out of the data, she’s left out of the solution.” This isn’t just a slogan—it’s the hard truth many organizations overlook. When women’s experiences, contributions, and challenges are not captured in data, strategic decisions are built on partial truths. We cannot address what we don’t measure. I remember working with an organization during a DEI audit where gender representation looked fairly balanced on the surface. But when we dug deeper, the data told a different story: • Leadership roles were overwhelmingly male-dominated. • Performance reviews showed a bias in language—men were described as “ambitious,” women as “cautious.” • Promotions for women plateaued at mid-management, despite equivalent performance metrics. The solution wasn’t more policies or more workshops—it was more data. Data that captured not just headcounts but lived experiences. Data that told the story of pay equity, growth opportunities, and workplace culture. When women are left out of these metrics, they’re left out of the growth, the opportunities, and the solutions that move organizations forward. If you’re serious about equity, start with the numbers. Measure what matters. Because if she’s not in the data, she won’t be in the boardroom either. #diversity #equity #inclusion

The venture-capital world has a serial-entrepreneur problem, and it is gendered. New National Bureau of Economic Research (NBER) research comparing male and female co-founders of the same startups reveals disparities that cannot be explained by founder quality or ambition: → Women make up only 4% of founders with 3+ startups (vs 13.3% of all VC-backed founders) → After a startup failure women are 22.5% less likely to secure venture-capital backing for their next venture → Female serial entrepreneurs raise 53.3% less capital after failures and 24.6% less after successes → Men receive larger deals for founding experience regardless of outcomes. Women are penalized for failures and barely rewarded for successes → When an unrelated women-founded startup fails, it hurts funding prospects for all female founders. However, successes do not create positive spillovers.

Did you know Australian women just set a record?🏅 Women's labour force participation rate reached a new high of 63.5% in January 2025. That's a half-percentage-point jump from the previous month. Which is big in labour statistics land. It's this rise in women's labour force participation that drove the overall increase in the national rate (as men's participation rate fell slightly). Proof why it's important to always add a gender lens. January is the month where many new jobseekers and new hires are joining the labour market. As well as mothers who have been juggling summer holiday demands, and whose children will now be starting childcare or school, changing their working availability and preferences. Some will still be in the process of looking for opportunities and yet to be matched to a suitable job. This start-of-year job searching can help explain why the unemployment rate ticked up very slightly to 4.1% (again it was women's unemployment rate that drove the overall change, as men's rate was unchanged). Also today we found out Australia's latest gender pay gap, reported for November 2024. Men are earning on average $2073 in full-time weekly wages, compared to $1826 for women. That's a gap of $247 a week, tallying to around $12,800 a year. It equates to women earning 11.9% less than men on average, a gap which has widened since the last calculation (11.5% in May 2024). Men's earnings surged more rapidly than women's during this six-month period, particularly in sectors such as the Real Estate where jobs growth is strong. And partly the gender earnings gap reflects compositional changes. For example, between May and Nov 2024, we saw a notable expansion in women's employment in the Preschool and School Education sector. But because that's not a high-paying sector, it can dampen the calculation of women's overall average earnings. The Australian Government's legislated pay rise for Early Childhood Education and Care Workers came into effect in Dec 2024, so will be reflected in the next gender pay gap calculation. These numbers come fresh from the Australian Bureau of Statistics' Labour Force and Average Weekly Earnings datasets released yesterday. The takeaway from these numbers is that women's opportunities to join and stay in the paid workforce – and gain economic independence – continue to grow. Government policies, company initiatives, working-from-home and hybrid work, as well as the financial necessity of cost of living pressures, are all likely factors contributing to this record-breaking rise in women's workforce participation. But, we still need sustained and strengthened efforts to undo patterns of gender concentration, rectify the undervaluation of female-concentrated sectors, and unravel the biases and barriers that still underpin the gender pay gap. There are still more records to be broken. #genderpaygap #gendergap #genderlens #womenintheworkforce #genderequality #economics #labourmarket #ausecon

The Global South, home to two-thirds of the world’s population, faces a stark reality: it contributes a mere 18% of global power generation. Alarmingly, 1.5 billion people lack access to reliable energy, especially in sub-Saharan Africa, where energy consumption mirrors that of France and Germany in the late 19th century.   To achieve a #netzero future, we need $1.7 trillion in annual investments, yet only 15% of #cleanenergy investments currently flow to these regions. This highlights the critical need for innovative solutions.   Innovative financing models, such as pay-as-you-go, are paving the way for affordable energy access, while #impactinvesting is bridging the funding gap for sustainable projects. Done right, #carbonfinancing and climate-linked debt swaps can unlock critical funds, enabling countries to meet #climate targets while driving economic growth.   I recently penned down my thoughts for the World Economic Forum on how these three key financing mechanisms are reshaping the future of energy in the Global South: https://lnkd.in/gxKFP2cW   Now is the time for private and public stakeholders to collaborate and leverage these solutions to ensure a sustainable and equitable energy future for all.   #LifeisOn #wef25

In 2021, I became the first woman to head a unicorn in Israel, AKA Startup Nation. In many parts of the world, women are excluded from even the most basic financial services, so leading a fintech company is far from their reality. United Nations data estimates that 3.8 billion women live in the world, 50% of which are adults. According to the World Bank’s Global Findex Database, 1.4 billion of those 1.9 billion adult women, are unbanked. That’s 73.65%. Visit that statistic again. It represents a disturbing gender gap in financial access, with women being far less likely than men to have bank accounts or access formal financial services. This financial exclusion has personal impact. It diminishes women’s economic empowerment by restricting access to education and limiting their potential for personal growth and independence. It makes women more financially dependent, and therefore, more vulnerable. There's economic impact, too. Research by McKinsey highlights the economic loss due to financial exclusion of women, noting that closing the gender gap in labor force participation could add trillions to global GDP. Financial inclusion isn’t just a matter of equality – ensuring the same opportunities for all. It’s a matter of equity - ensuring women have the tools and access they need to fully participate in the global economy. That’s where technology enters the picture to level the field. The rise of mobile banking is a great example of innovation enhancing financial inclusion. According to a report by the International Finance Corporation, mobile money accounts are more popular among women in regions like Sub-Saharan Africa, where access to traditional banking is limited. Various fintechs provide financial literacy resources, helping women understand financial products, budgeting, and saving strategies. Other solutions include AI-driven platforms that offer personalized recommendations and advice, empowering women to make informed financial decisions. Aside from personal apps and solutions, fintechs can facilitate community-based lending and saving initiatives, allowing women to support each other through group savings or microfinance schemes, fostering a sense of solidarity and shared purpose. This International Women’s Day’s theme is "accelerate action". In my mind, nothing accelerates action like innovation. As we mark International Women's Day, let’s advocate and innovate to enhance financial inclusion for women worldwide. #IWD2025 #financialInclusion Papaya Global

Diving into the Climate Fintech Landscape 💡 The emergence of fintech companies focusing on innovative climate solutions has gained significant momentum in recent years. They are offering fresh perspectives to financial institutions and corporations, helping them achieve their climate goals. The rising public interest in sustainability is also driving the introduction of regulations aimed at holding corporations accountable and eradicating greenwashing. 🔎 Bridging the Climate Data Gaps Quality data remains the primary ESG challenge facing financial institutions and investors. Private markets, for instance, offer limited climate disclosures. But change is on the horizon, with firms like Novata and ESG Book targeting this particular asset class and aiming to close that data gap. As we transition from a scarcity to an abundance of ESG data, we face the next challenge: standardising data. 👨💻 Addressing Data Integration Challenges Despite improvements in ESG datasets, a ‘one-stop shop’ does not exist yet. Financial institutions find themselves juggling data from multiple vendors to form a clear picture. This data must then be integrated into their internal systems and technology stack, which is often a complex and time-consuming process. Fintechs like Novisto or WeeFin, however, are addressing this issue by developing data operations platforms. 📊 Streamlining Carbon Management We’ve noticed a surge in carbon accounting start-ups offering intuitive software to help companies measure, reduce, and offset their carbon footprint. The space is very well-funded but crowded; we foresee consolidation and predict success for those with robust data capabilities, flexible technology, and value-add services like Greenly | Certified B Corp and Plan A. 🤖 Assessing and Pricing Climate Risks Climate change is no longer a distant reality. Investment managers face the daunting task of integrating climate change projections to assess risk and return expectations that inform security selection in investment portfolios. A few companies are tackling this space, including Jupiter Intelligence and riskthinking.AI in physical risks and Risilience in transition risks. Financial institutions require robust climate intelligence to help them form sound investment decisions 🌍 Carbon: A New Asset Class Decarbonisation is the critical first step towards achieving net zero. This includes initiatives to cut carbon emissions and investments in carbon credits to offset unavoidable emissions. Sylvera, for instance, helps bridge the gap. Their trusted and unconflicted data is helping asset managers evaluate the net-zero plans of investee companies globally. It also facilitates the development of new sustainable investment products. Source: Fidelity International Strategic Ventures - https://bit.ly/3YQx6W0 #Innovation #Fintech #Banking #Neobanks #OpenBanking #OpenAPIs #FinancialServices #Payments #Credit #Investing #OpenData #ESG #Sustainability