Women's World Banking

Women's World Banking is a global nonprofit organization dedicated to women's economic empowerment through financial inclusion.

Mission and vision
The mission of the Women's World Banking global network is "to expand the economic assets, participation and power of low-income women and their households by helping them access financial services, knowledge and markets."

History and governance
Women's World Banking was borne out of an idea conceived during the first United Nations World Conference on Women, held in Mexico City in 1975 to coincide with the International Women's Year and to mark the start of the "UN Decade for Women" (1976–1985).

The Mexico City conference was convened by the United Nations General Assembly to focus international attention on the need to develop future-oriented goals, effective strategies, and plans of action for the advancement of women. A group of ten women from five continents determined that economic independence can reinforce women's rights, enabling them to make choices and affect their own education, opportunity and well-being. Providing small loans and other financial services to poor women entrepreneurs was seen to be a powerful weapon in the global fight against poverty. Women's World Banking was thus founded in 1976 by several women leaders from a diversity of cultures.

The Founding Committee included Michaela Walsh, the first woman manager of Merrill Lynch International, who became the organization's first president; Ela Bhatt, founder and president of India's Self Employed Women's Association (SEWA), the world's first and largest trade union for undocumented women workers; and Esther Ocloo, one of Ghana's leading entrepreneurs and a prominent advocate of the role of women in economic development, who served as the first chairperson of WWB's Board of Directors. According to Bhatt, the goal was "To reach women who have been bypassed by the traditional banking system and to bring them into the economic mainstream."

In 1979, WWB was officially incorporated, registering in the Netherlands as Stichting (Foundation) to Promote Women's World Banking, an international nonprofit organization with the objective of providing women entrepreneurs with the capital and information necessary to access the money economy of their own countries and build viable businesses.

In 1991, Nancy Barry became WWB's second president. She led the expansion of the WWB network to include major banks, recognizing their potential to be innovative in bringing financial services to poor populations. During her tenure, the WWB network grew to reach nearly 20 million low-income entrepreneurs.

Mary Ellen Iskenderian became WWB's third president in 2006 and she has held the post for over 15 years.

WWB is governed by a Board of Trustees, made up of representatives from the sectors of banking, finance, business, law, and community organizing. "Friends of WWB/USA, Inc." is a 501(c)(3) tax-exempt organization which raises donations from U.S. foundations, corporations and individuals in support of Women's World Banking's global mission, and maintains a separate Board of Directors made up of U.S.-based leaders in law, finance and academia.

At the Clinton Global Initiative Annual Meeting in September 2009, President Barack Obama recalled his mother working at WWB, where "She championed the cause of women's welfare and helped pioneer the micro loans that have helped lift millions out of poverty." The former President's mother, Ann Dunham-Soetoro, was WWB's policy coordinator in the mid-1990s, and her work was pivotal in informing the policy platform of the United Nations Fourth World Conference on Women in Beijing in 1995.

Focus on women
The earliest MFIs were largely gender neutral: they sought to offer credit to low-income entrepreneurs who lacked assets to pledge as collateral and as such were deprived of access to capital by the formal banking sector—an obstacle that still affects women in disproportionate numbers today.

Research began to show that granting women microloans had an enduring, more profound impact on the broader well-being of the population. Access to credit gave women not just more control over household assets, but also more autonomy and decision-making power and greater participation in public life. Empowering women economically had a multiplier effect as well. Evidence showed that poor women reinvested much more of their income in their families and communities than men did—financing such items as health care, education for their children, and home improvement. The woman entrepreneur as the gateway to household and community stability became a fundamental basis for the microfinance business model and a guiding principle behind the value of microfinance as a tool for poverty alleviation.

In view of the multiplier effect of empowering women, and in keeping with its founders' intent, WWB has since its inception concentrated specifically on enhancing the opportunities and well-being of women through economic independence. WWB conducted gender research on household dynamics and women's roles in financial decisions in low-income families. This research, led to changes such as: simplified loan paperwork and borrowing requirements, which take into account women's lower literacy rates in many countries; changes in the design of MFI branches to accommodate women with small children; and housing loans for which women must be placed on the property title for the household to receive the loan.

Products and services
As the microfinance field grows, WWB has created new products, including; savings, microfinance, housing/home improvement loans, individual lending and rural finance. WWB also offers its network members advisory and technical assistance, including; research, branding and leadership.

The network
As a network, WWB does not issue loans directly to microentrepreneurs. Rather, it serves as a partner to its members, in their respective markets across five regions: Africa, Asia, Eastern Europe, Latin America and the Caribbean, and the Middle East and North Africa. As of 2009, the network represented an outstanding loan portfolio of more than US$5.5 billion and an average loan size per borrower of $1,200.

In 2007, ten WWB network members were named on Forbes magazine's first-ever list of the world's top 50 MFIs.

In 2009, thirteen network members were named on the Global 100 Composite Ranking by the Microfinance Information Exchange (the MIX), a nonprofit organization that provides business information and data services for the microfinance industry. This list highlights institutions that achieve high outreach and low transaction costs while being both profitable and transparent.

Women and leadership
Women's leadership has been a core element of microfinance since the industry's inception. Many of the industry's pioneers were women, and a solid female managerial contingent held steady as MFIs grew.

The business case for gender diversity in microfinance maintains that organizations that successfully hire, retain and promote women will achieve not just social benefits, but also financial returns. According to a 2007 report, Fortune 500 companies with the highest representation of women board directors attained significantly higher financial performance on average than those with the lowest representation. A 2007 study of 226 MFIs in 57 countries demonstrated that when the CEO of an MFI was a woman, the MFI showed a higher return on assets and lower operational costs. A 2008 leadership survey conducted by WWB showed that female loan officers and women authority figures make powerful role models for their female customers.

The microfinance industry saw a compound annual growth rate of 43% between 2004 and 2008 Research shows that within Women's World Banking member institutions between 2003 and 2007, the percentage of women in board positions declined from 66% to 58% and in senior management from 66% to 51%.

In 2009, WWB founded the Center for Microfinance Leadership to engage diverse leaders with the skills and values to both understand microfinance's dual objectives of financial stability and poverty alleviation, and set the vision, principles and practices of the sector. Founded in partnership with the Wharton School of the University of Pennsylvania and executive development firm Creative Métier Limited, the Center offers individual leadership programs, coaching, and practitioner exchanges, as well as institutional programs designed to improve gender diversity and develop managerial talent.

Commercialization
In 2008, WWB conducted research to assess the degree to which pressure to generate profits dilutes the aim of poverty alleviation. The study, Stemming the Tide of Mission Drift: Microfinance Transitions and the Double Bottom Line, found that after transformation, the proportion of women served by formalized institutions dropped dramatically, from 88% to 60%. It also found that average loan sizes were two to three times greater than those of non-commercialized organizations. These results may serve as evidence that a lower percentage of loans are going to women, because they tend to borrow smaller sums.

Mary Ellen Iskenderian noted, "Ensuring that women do not lose out in access to microfinance as institutions grow is vital. There are 30 years of data showing that women put more of their loans than men do into education, healthcare and nutrition, that their children stay in school longer and have longer life expectancy."

Microfinance's impact
In 2010 a number of questions were raised in prominent media about whether microfinance has made a quantitative improvement in the lives of borrowers. WWB, along with fellow microfinance organizations ACCION, FINCA, Grameen Foundation, Opportunity International, and Unitus, released a collective statement in response to the studies. First, studies were based on short-term data. Second, quantitative studies often do not take into account qualitative evidence which is not based on specific data points such as consumption patterns. Indications of impact are often small and very gradual: for example, moving from a cardboard roof to a metal one. Many microfinance experts posit that access to financial services brings a measure of stabilization to otherwise precarious lives."