Narrowing the gender gap through Digital interventions
With a vision statement of “financially included, economically empowered Pakistanis” Karandaaz Pakistan, through all of its four verticals i.e., Capital, Digital, Innovation and Research; is working to develop and promote an all-inclusive and a conducive financial environment and accords great importance to equal provision of financial services to women. Since its inception, Karandaaz Digital – one of the four verticals, directly funded and monitored by the Bill & Melinda Gates Foundation (BMGF) – has developed extensive partnerships with public & private institutions alike. The primary aim of these partnerships is to enhance the financial inclusion of masses and improve their access to digital financial services through well designed and targeted interventions, having a distinct focus on women and low-income households.
To further refine its approach and in order to provide a strategic direction for its future activities, Karandaaz Digital has drafted a Gender Action Plan that lays down four key objectives, explained below.
1) Mainstreaming Gender in the Digital Portfolio
The first objective relates to ensuring that gender is embedded in all of Karandaaz Digital’s activities. This entails capacity building of the team and gender sensitization, carrying out a periodic gender audit of the portfolio and publishing disaggregated gender metrics. Accordingly, the vertical has designed and implemented some initiatives to have a more effective impact of its interventions. On the private sector front, the team is working in partnership with various businesses to test models that can help improve digital inclusion and participation of women in the domestic financial scenario. Some programs are focused on conducting A/B testing  on pricing, communication, channel or features of financial products to find solutions that would result in higher uptake of a digital financial service.
One such experiment with Hysab Kytab has been concluded recently (detailed insights of the experiment are shared in Box 1), while another is currently in process with Ubank, which will be focused on evaluating and designing an incentive system that can encourage women to save in their mobile accounts; options include offering a higher rate of return; a cash-back option; and bundling with other relevant financial products. With its aim to promote product innovation, the vertical has recently announced a second round and taking applications for potential digital experiments. The action plan also involves management of a design thinking program for early stage fintechs to educate and promote adoption of design thinking approach in their financial offerings, particularly for women-centric products.
Partner spotlight: Hysab Kytab
Karandaaz Digital conducts experiments in collaboration with the private sector to test various hypotheses for the benefit of the industry. Hysab Kytab (HK) is one such partner, which offers a personal financial management application. It was observed that most of HK’s user base comprised of men, so an experiment was designed to test if enhanced UI/UX features coupled with a recommendation engine can increase the level of women’s engagement. Over the span of several months, engagement levels for two different variants, one with basic features and one with more enhanced features of the app, were analyzed among a sample size of 8,000 women. Color schemes, fonts, illustrations, onboarding instructions, icons and animations were changed, among other characteristics. It was found that the conversion rate of the financial products offered to women increased by 1.3 times i.e. from 37% to 47%, while the conversion for male participants remained steady at 51%. The onboarding success rate increased by 4% and the female user acquisition cost (measured as average cost per install) declined by 40% due to the costs being spread out over a much larger user base now.
There were some other interesting insights as well that were unearthed during the experiment. For instance, emotion-based story telling is more effective; animations with localized human images work better than static images; 20% of new downloads were a result of referrals by other women rather than expensive digital media marketing; women have a 1.2 times higher propensity to save than men and 25% of the conversion was for small ticket-size loans offered by HK’s partners. The experiment clearly demonstrated ways to increase the profits earned from the female segment without adversely affecting the male segment, and for this reason the findings are being made public for the benefit of the industry.
Additionally, a yearly challenge round branded as “Financial Inclusion for Women Challenge (FIWC)”
was introduced in 2019, under which technology companies and financial services providers can access funds, particularly for ideas that can result in better adoption of financial services for women. In the first round, two of the applicants i.e., Techlets Pvt. Limited (Techlets) and Oraan Tech. Pvt. Limited (Oraan), emerged as final winners. Techlets has developed a unique platform called Walee that connects small women-led businesses with influencers. Their app allows the businesses to track the activities and the influencers to receive payments digitally. Oraan, on the other hand, offers a digital ROSCA (or committee savings) product to middle and low-income women, and have on-boarded a sizeable number of women (including women-led businesses). The FIWC program has got an overwhelming response from the industry and to continue momentum, second round has been launched in October 2020, whereby the winners will be announced at the start of next year.
|Number of Incremental Users||9,406||65,016||74,422|
|Number of Incremental Transactions||14,945||127,861||142,806|
|Value of Incremental Transactions (PKR)||46,829,571||6,499,336||53,328,907|
Note: The value of transactions for one of these partners couldn’t get recorded as the app links its users to partner financial institutions instead of providing a suit of financial products its self; accordingly, the number of transactions and value of transactions are not linearly correlated.
On the public sector front, Karandaaz Digital is working with Benazir Income Support Programme (BISP) to cater to the low-income women and allow them to access the unified payments system so that they can transfer funds seamlessly. In addition, support is also being provided to upgrade and strengthen BISP’s data management and governance infrastructure. Central Directorate of National Savings (CDNS) is another major public partnership. The vertical is providing support to CDNS to roll out dynamic digital service; including an ATM card and a mobile app, to its consumers (half of which are women).
2) Research & Advocacy
This objective pertains to carrying out research on gender-specific barriers in the provision and update of digital financial services and then formulating and recommending solutions to these bottlenecks. It also includes collaboration with international development organizations and disseminating the learnings from various interventions to the wider industry.
3) Policy Support
This includes providing support to regulator for policy improvements, so that they are more inclusive and less ambiguous in terms of their targeting settings, especially with regards to women’s financial inclusion. The Design, Digitize and Direct (D3) framework of the BMGF has been implemented to evaluate the current status of progress under BISP which identified four action items, i) opening of optional savings account for beneficiaries in addition to the mandatory limited mandate accounts; ii) poverty graduation; iii) financial inclusion; and iv) upgradation of IT infrastructure. Karandaaz Pakistan is working to connect the social welfare beneficiaries to a unified payment infrastructure called the Micro Payments Gateway to allow interoperability. It is also providing technical support to open mobile wallets (with options for current and savings accounts) and taking steps to improve digital financial literacy of women population.
4) Capacity Development
Interventions can only be successful if the industry and stakeholders have the necessary skills and understanding of their implementation. Accordingly, the fourth pillar is focused on capacity building of various partners and grantees, ensuring that their processes and practices are gender sensitive, beginning with the FIWC grantees.
With these four pillars Karandaaz Digital envisions to enhance the effectivity of its Gender Action Plan, take a more targeted approach and make a far-reaching tangible impact of its designed interventions with an overarching aim to support low-income women population of Pakistan and their connectivity to the formal financial system.
 A/B testing (also known as split testing) is a process of showing two variants of the same web page to different segments of website visitors at the same time and comparing which variant drives more conversions.
 Hysab Kytab is a locally domiciled technology company providing digital solutions to manage an individual’s financial activities, providing a 360-degree review of one’s budgeting, spending and savings.