For a country this size and demographics, Pakistan’s financial services ecosystem is particularly underdeveloped, where traditional institutions continue to be locked out of a large segment of the real economy. One indicator is our overwhelming dependence on cash, as reflected by the currency in circulation crossing Rs9.1 trillion in June.

For decades, the financial institutions in the country have skirted around their responsibility and made access to their services cumbersome for ordinary folks. According to the World Bank’s Findex, only 16.29 per cent of the adult population in Pakistan had a financial institution account, putting us ahead only of five states: South Sudan, Afghanistan, Guinea, Sierra Leone, and Iraq.

And as always, things happen to be much worse for women, where the corresponding percentage is estimated to be only 11pc. Anyone who has ever visited a bank branch can probably attest to how difficult it is to bank as a female customer in Pakistan. To address this problem, we have seen a number of policies, whitepapers and conferences over the last few years. But have things really changed? Let’s look at the data.

As far as financial institution accounts are concerned, Pakistan has indeed noticed considerable progress, with the number reaching 167.4 million in December 2022, compared to just 69.6m back in June 2017. Almost 27pc, or 45.95m, of the total, belongs to women, of which 28.07m were unique depositors.

Numbers indicate that for females, for every Rs100 spent through a payment card, Rs12.7 is paid via point of sales and Rs4.4 through e-commerce

Going by these numbers, 39pc of all adult women in Pakistan are banked. In contrast, the World Bank and Karandaaz estimate that proportion at 11.5pc and 13pc, respectively. While it’s true there will always be differences in demand and supply side numbers, such a massive gap is questionable: either about the survey methodology or the reported data.

More importantly, active female unique depositors also increased to 21.82m as of December 2022, compared to only 8.2m in June 2017. Over the same period, the corresponding numbers for males are 42.05m and 21.26m, respectively. While this is great progress, focusing too much on just account openings is a little futile because what really matters is their quality. Ideally, that is measured using the transaction activity, but no such data is available.

Luckily, there are a few ways we can assess that quality. First of all, 28.7m — or 62.5pc of the total — female accounts were branchless as of 2022. This is not just for women: the corresponding share for males was also 59pc. The credit for this goes to players like JazzCash and Easypaisa, who have, to some extent, plugged the gap left by legacy institutions in providing access to financial services.

However, let’s be mindful that mobile money wallets offer a tamed-down version of banking, further lowering the bare minimum standards of financial inclusion.

The second indicator is to look at the number of female-owned debit cards, which stood at just 6.2m as of December 2022. That’s 19pc of all debit cards in the country. Put another way, only 36.2pc of the scheduled banking accounts of women had a debit card, compared to 55.3pc for males. So even when women have a proper bank account — not a digital wallet — they are far less likely to get something as basic as a debit card.

Let’s not even talk about credit cards because our banks just don’t bother with that segment, regardless of gender, and given the current interest rate environment, even the existing users are feeling the strain.

Interestingly, as banks double down on digitisation initiatives, women may even be better customers to target. For example, of the total female spend through payment cards, 12.7pc was on point of sale (POS) and 4.4pc on e-commerce — both substantially higher than the corresponding figures of 7.7pc and 2.5pc for males. That means if women are spending Rs100, every Rs12.7 is paid via POS and Rs4.4 through e-commerce.

Volume-wise, women had an even larger share in POS and e-commerce, at 29.4pc and 10.2pc, respectively. Again, this is substantially higher than men’s 18.3pc and 5.5pc, respectively. Basically, of all the transactions from female-held cards, almost 40pc are truly digital — i.e. not on ATMs.

One could argue that this may be because female customers who have debit or credit cards are already relatively well off (because banks don’t issue them to the rest) and thus are more digital. While the reasoning makes sense, it ignores one thing: women usually manage household expenses even if the card itself belongs to men. So, if a wife goes to Imtiaz and pays for monthly groceries (high value) via her husband’s card, the data should be reflected in at least a higher POS value for males.

Nevertheless, the data so far points to two contrasting realities: despite being more digitally savvy in terms of spending, female users struggle to access even the most basic of financial services. Unfortunately, no one in the status quo really wants to do anything to bring a meaningful change, apart from a few marketing gimmicks here and there.

Mutaher Khan is co-founder of Data Darbar and Halima Iqbal is the founder of Oraan

Published in Dawn, The Business and Finance Weekly, September 4th, 2023