Digital Financial Inclusion of Women in MSMEs: G20 and India

Digital financial inclusion (DFI), especially for vulnerable groups like women, youth and micro, small and medium enterprises (MSMEs) is a core topic for discussions in international forums such as the G20. With a growing focus on the adoption of financial technology and digital payments systems by both individuals and businesses, the global digital payments market is expected to grow at an estimated compound annual growth rate (CAGR) of over 13 percent between 2022 and 2026. As access to, and usage of digital financial services increases, it can help promote gender equality by enabling affordable transfers, increasing women’s bargaining power in case of social security transfers, increasing women’s resilience to financial, economic and health shocks. Yet, there continues to be several gaps in DFI of women, and thus, there has been growing prioritisation of DFI for women at a policy and programmatic level across G20 countries and in the G20 forum. With India entering the Troika in 2021 and taking over the G20 Presidency for 2023, there is a need for the country to focus on both the achievements and the issues related to DFI of women and MSMEs in India. To participate actively in the discussions, there is need to have a clear understanding of the issue and India’s strengths. The Centre and state governments, the Reserve Bank of India (RBI), and National Bank of Agriculture and Rural Development (NABARD) have introduced several schemes and initiatives to facilitate DFI of women and MSMEs. Some of these schemes, such as the Pradhan Mantri Jan Dhan Yojana (PMJDY), Stand-Up India, and Pradhan Mantri MUDRA Yojana (PMMY), which have provided better access to digital finance to women, can also be showcased in the G20. Yet, there are hardly any survey-based studies on where the country stands, its achievements and gaps in DFI, especially with reference to the MSME women entrepreneurs and employees. This study aims to fill the lacuna.