Many women still live in poverty, but we can change this
Lee
Hooi
Yean
In its recent gender snapshot, the United Nations noted that: “Globally, in 2023, women aged 55 to 59 are more likely to live in extreme poverty than men.”
Many women reach old age with few assets and savings, and lack an adequate pension or social protection benefits.
This is due to a higher likelihood of career interruptions, part-time employment, lower earnings, and more time spent on unpaid care responsibilities.
Read more: The mental health challenges facing ageing women: Insights from female baby boomers
Unless we change the trajectory, the UN predicts 340 million women and girls will be living in extreme poverty by 2030.
Microcredit and micro-enterprise development have been lauded for a capacity to empower women and alleviate poverty.
When we strengthen women’s economic security, the benefits flow on to their families’ nutrition and health, children’s education, and their broader communities.
Yet microcredit can be a double-edged sword – the prevalent neoliberal model passes the high cost of lending to borrowers, exacting a heavy toll on the poor.
The high cost of mainstream microcredit poses a debt trap to vulnerable borrowers. For example, evidence has emerged of families becoming enslaved in Cambodian brick factories with dangerous work conditions as a result of debts they could not repay.
Over-indebtedness has other harmful impacts, such as losing assets pledged as security, or having to forego meals to make repayments.
The stress of unmanageable debt can lead to poorer mental health, relationship problems, homelessness, and at times even suicide.
Our recent research shows that microcredit can be different and better.
We collaborated with non-profit organisation Women of Will (WoW) Malaysia to examine the impact of their microcredit and mentoring program for low-income female breadwinners, most of whom are single mothers.
With support from corporate funders, WoW provides interest-free microcredit, business coaching, skills training, and mentoring to help micro-entrepreneurs build sustainable livelihoods.
Microcredit-enabled entrepreneurship is promoted by leading transnational organisations as a means of addressing poverty and bridging the gender gap.
Corporate-funded interest-free microcredit enables the women to focus on building their micro-enterprises without the worry of escalating debt.
Corporate support also allows a shift in focus towards empowering women and fostering their wellbeing, and away from the demanding repayment schedules characteristic of mainstream microcredit.
WoW’s positive outcomes
Our impact studies reveal that women who participated in WoW’s program experienced positive outcomes across a range of indicators. The positive impacts are reflected in 79.46%
participants growing their microenterprises, and 80.33% improving their business knowledge and increasing their household income.
The results of our natural experiment showed that WoW women had better financial capability, wellbeing and stability than those who had not participated in the program.
The positive impacts were also reflected in participants’ personal and family lives.
71.89% of WoW participants reported that they were able to spend more time with their children. This, in turn, had positive flow-on-effects on their children’s education. Overall, 84.86% of women reported higher confidence levels after participating in WoW’s program.
Likewise, their increased empowerment, overall confidence levels and self-efficacy in entrepreneurship were evident.
Participants had improved capacity to develop and market new products, predict client demand, and network. They also acquired digital skills that helped them manage the challenges of the COVID-19 pandemic.
Access to affordable finance is often a challenge for single mothers juggling childcare with insecure work. Interest-free microcredit enables participants to focus on developing their micro-enterprise without the worry of escalating debt.
Practical skills training helps them to develop their micro-enterprise, manage their finances, improve their customer service, broaden their customer base, and develop innovative products that attract more sales. Each participant is mentored and given individualised support in growing her micro-enterprise.
It’s not just about growing micro-enterprises
WoW participants gain community support and social networks. Participants can opt to join the group initiatives to fulfil corporate orders for festive hampers and other products to earn additional income.
Supportive leaders and peers share with the newer recruits the strategies they’ve learned to help them overcome similar challenges, and thrive. And many go on to become leaders in their communities who have a positive influence on other families.
The positive impact of these initiatives on the women’s financial security and wellbeing reflect the value of collaboration between corporations and women’s groups. Yet the significant role that corporations can have on gender equality and empowerment is overlooked and under-utilised.
We’ve made significant strides towards gender equality in corporate leadership, but millions of women continue to live in poverty around the world.
Even in Australia, older women are the fastest-growing group of homeless individuals, and many are escaping family violence. In 2020, 405,000 women aged over 45 years were at risk of homelessness. This sadly often follows a lifetime of caring for others and economic disadvantage.
Corporate partnerships with women’s groups can help contribute much-needed solutions to the problem of gendered poverty.
At the same time, corporations benefit from contributing to socially-impactful projects. ESG investments have grown progressively popular, and making a genuine impact on disadvantaged communities is attractive to investors and talented employees.
Society increasingly expects businesses to be a force for the greater good. It’s high time we harnessed this to help at-risk women build sustainable livelihoods, fostering a fairer world.
About the Authors
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Grace lee hooi yean
Professor, School of Business, Monash University Malaysia
Grace is a professor of economics and head of the Department of Economics at Monash University Malaysia. She’s currently leading a team of researchers from Australia, Indonesia, Malaysia and Thailand on a regional project titled ‘Rural Women Empowerment through Entrepreneurship in Malaysia, Indonesia and Thailand’. She’s the principal investigator of the World Values Survey (WVS), a global network of social scientists studying changing values and their impact on social and political life since 1981 in more than 100 countries. Her principal areas of interest are applied economics, experimental and behavioural economics.
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Koh geok may
Senior Lecturer, School of Business, Monash University Malaysia
Sharon is the Director of Graduate Research Programs. Her research lies in the areas of Development Economics and Economic Integration, mainly focusing on countries in Southeast Asia. Her research interests include development economics, economic integration and the ASEAN Economy.
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Vivien chen
Senior Lecturer, Business Law and Taxation, Monash Business School
Vivien investigates the adequacy of legal protections for consumers in financial stress, together with researchers from Melbourne Law School and consumer advocates, and is part of an international collaboration on directors' accountability, and gender equality. Vivien has been a visiting research fellow at the National University of Singapore and has previously held an academic position overseas. Her publications include articles on Australian and Malaysian corporations law, gender, debt collection and financial regulation in the ASEAN Economic Community. She regularly contributes to corporate governance and business law blogs, and to law reform initiatives.
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Nicola charwat
Senior Lecturer, Business Law and Taxation, Monash Business School
Nicola's research interests lie primarily in international law and international trade law and governance, particularly international courts and dispute settlement mechanisms. The intersections between international trade law and governance on the one hand and social justice objectives on the other is of special interest.
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