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BEYOND MICROFINANCE: EMPOWERING WOMEN

IN THE DEVELOPING WORLD

HEARING

BEFORE THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FIFTEENTH CONGRESS

FIRST SESSION

JULY 12, 2017

Serial No. 115–53

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

ADAM KINZINGER, Illinois 

LEE M. ZELDIN, New York 

DANIEL M. DONOVAN, JR., New York 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

ANN WAGNER, Missouri 

BRIAN J. MAST, Florida 

FRANCIS ROONEY, Florida 

BRIAN K. FITZPATRICK, Pennsylvania 

THOMAS A. GARRETT, JR., Virginia 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

KAREN BASS, California 

WILLIAM R. KEATING, Massachusetts 

DAVID N. CICILLINE, Rhode Island 

AMI BERA, California 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania 

DINA TITUS, Nevada 

NORMA J. TORRES, California 

BRADLEY SCOTT SCHNEIDER, Illinois 

THOMAS R. SUOZZI, New York 

ADRIANO ESPAILLAT, New York 

TED LIEU, California

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

(III)

C O N T E N T S 

Page

WITNESSES 

Ms. Mary Ellen Iskenderian, president and chief executive officer, Women’s 

World Banking ..................................................................................................... 4

Tavneet Suri, Ph.D., associate professor of applied economics, Sloan School 

of Management, Massachusetts Institute of Technology .................................. 9

The Honorable Melanne Verveer, executive director, Georgetown Institute 

for Women, Peace and Security, Georgetown University ................................. 22

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Ms. Mary Ellen Iskenderian: Prepared statement ................................................ 7

Tavneet Suri, Ph.D.: Prepared statement ............................................................. 11

The Honorable Melanne Verveer: Prepared statement ........................................ 24

APPENDIX 

Hearing notice .......................................................................................................... 60

Hearing minutes ...................................................................................................... 61

The Honorable Eliot L. Engel, a Representative in Congress from the State 

of New York: Material submitted for the record ............................................... 63

The Honorable Gerald E. Connolly, a Representative in Congress from the 

Commonwealth of Virginia: Prepared statement .............................................. 71

(1)

BEYOND MICROFINANCE: EMPOWERING 

WOMEN IN THE DEVELOPING WORLD 

WEDNESDAY, JULY 12, 2017

HOUSE OF REPRESENTATIVES,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The committee met, pursuant to notice, at 10:11 a.m., in room 

2172, Rayburn House Office Building, Hon. Edward Royce (chairman of the committee) presiding. 

Chairman ROYCE. This hearing will come to order. If I could ask 

the members here to take their seats. 

This hearing is the fourth in our series of hearings to examine 

the challenges and opportunities facing women worldwide. 

Today we consider some of the barriers to economic empowerment that women face in developing countries and what that 

means for them, what it means for their families, and what it 

means for their communities. 

Now, all countries stand to benefit from women’s increased economic participation. But the potential gains are particularly great 

across the developing world, due to the extent of the constraints 

that so many women face on their ability to own property, their 

ability to access financial services, or work outside the home. Consider that women in more than half the world’s countries face limits on their ability to own or manage property, while women-led 

small to medium-size firms in developing countries face an estimated $285 billion credit gap. 

As renowned Peruvian economist Hernando de Soto explained 

when he testified before this committee, one of the primary sources 

of stagnant growth and unrest in developing economies is a lack of 

property rights, and the resulting exclusion of workers, including 

women, from the formal economy. 

These constraints directly harm women by preventing them from 

working, from saving, and from controlling their own future. But 

they also harm economic growth and they harm stability. In fact, 

a multitude of studies project huge gains of global GDP from increases in women’s economic participation. 

Perhaps that is why, after de Soto helped reform the customary 

laws in his native Peru to make it easier for Peruvian women to 

work and to own property, women’s formal labor force participation 

increased by 15 percent in that country. As a result, Peru became 

one of the fastest-growing economies in Latin America. 

We have reason to be optimistic that this type of success can be 

replicated. More developing nations are beginning to understand 

2

the importance of women’s economic inclusion and are taking steps 

to reform their laws and to address inequities. The U.S. has a critical leadership role to play in continuing to promote such reforms. 

Our economic, humanitarian, conservation, and many other interests around the world are better served when women are empowered and when economies are growing. 

Fortunately, new technologies are making women’s economic participation more possible than ever. In decades past, microfinance 

loans were championed to combat extreme poverty. But microfinance is not a cure-all for those living in poverty, particularly 

those women who face so many additional challenges to their economic empowerment. 

In recent years, however, an exciting array of financial technologies, like mobile money, have sprung up across the developing 

world. This presents tremendous opportunity for impoverished communities and women in particular. 

And so I look forward to hearing from our distinguished panel 

today about how the U.S. Government can batter help ensure women’s inclusion in the rise of ‘‘Microfinance 2.0.’’

And I now turn to our ranking member, Mr. Engel, for his remarks. 

Mr. ENGEL. Mr. Chairman, thank you for calling this hearing. 

To our witnesses, welcome to the Foreign Affairs Committee. 

Ambassador Verveer, I am especially grateful that you were able 

to join us. I know you had to rearrange some travel to be here. 

Your work as our country’s first-ever Ambassador-at-Large for global women’s issues made a lasting difference all over the world. And 

I hope that the administration sees the value of this position and 

appoints a new Ambassador soon, along with so many other positions at State awaiting nominees. 

And I want to thank Dr. Suri and Ms. Iskenderian. I hope I 

didn’t butcher that. Thank you so much. We look forward to all of 

you testifying. 

We use the word ‘‘empowerment’’ a great deal when it comes to 

women’s and girls’ issues. And honestly, I think it is a bit of a misnomer. Women and girls are powerful and we know what happens 

when that power and potential are unleashed—communities thrive, 

local and global communities grow, societies prosper and become 

more inclusive and equitable. If women were full participants in 

the global economy, we would see an additional $12 trillion to $28 

trillion in growth in global GDP by the year 2025. 

Certain innovations, such as microfinance and mobile banking, 

have driven progress in women’s economic participation, but they 

aren’t close to a silver bullet. A woman without a mobile phone 

cannot take advantage of these tools. A woman without a birth certificate might not even be able to open a bank account. And in too 

many places around the world much bigger roadblocks stand in the 

way of women exercising their full potential. Roadblocks caused by 

poverty or lack of opportunity or by legal barriers or cultural and 

societal norms that treat women as second-class citizens. 

So when it comes to promoting economic access and participation 

for women, I think we should focus on getting these obstacles out 

of the way and make it easier for women and girls around the 

world to put their power to work. 

3

Now, in my view, making economies more inclusive for women is 

simply the right thing to do. It is just wrong that women anywhere 

are denied access to the same economic opportunities as men. And 

that is true in the United States as well. We might not want to 

deal with it, we might not want to confront it, but it is true. 

But this is the Foreign Affairs Committee, so we also need to 

ask: Why is women’s economic opportunity a foreign policy priority? 

Well, it is easy: All those benefits of women’s full economic participation I mentioned earlier—stronger, more stable societies—are 

also in our national interest. We want to see economies thrive, governments become more responsive, countries become stronger partners on the global stage. 

Full participation of women is directly tied to these outcomes. So 

from a strategic standpoint, this is good, smart policy that 

strengthens American security. 

The aim of our policy then should be to identify and meet the 

challenges that hold women back from full economic participation. 

When we start to look at those challenges, we find that women’s 

economic participation is closely tied to a range of other issues that 

disadvantage women and girls in the developing world. 

For example, a young girl who is denied an education won’t become financially literate or learn the skills needed to compete in 

the marketplace. Girls forced into child marriage won’t have a 

chance to contribute to their local economies. Women who are victims of gender-based violence and domestic abuse are less likely to 

get ahead economically. 

Perhaps most importantly, access to quality healthcare, including 

family planning, is critical to women’s economic success. The evidence is indisputable: Improving women’s access to contraception 

improves their economic well-being. Women who are able to plan 

and even delay childbirth are more likely to get an education, raise 

their standards of living, and climb out of poverty. 

That is one reason American policy has focused on expanding access to family planning around the world. These efforts have seen 

good results. In the 27 countries with the biggest USAID-supported 

programs, the rate of modern contraception use has risen from 

under 10 percent a half century ago to 37 percent today, a good 

jump, but it shows we still have a long way to go. 

Now, the Trump administration has said that it supports efforts 

to empower women and girls around the world, but its budget proposal tells a different story. The Trump budget completely zeros 

out funding for international family planning and reproductive 

health and eliminates American support for the United Nations 

Population Fund, the largest purchaser and distributor of contraception globally. 

On top of that, the administration has reinstated and expanded 

the global gag rule, which we know has devastating effects on 

women’s health around the world. This is a disgrace which will set 

women back across the globe. 

Addressing women’s economic participation requires a broadbased, integrated, detailed-oriented, and comprehensive approach 

that deals with all the issues I mentioned, plus a host of others. 

The wrong approach is to cut our diplomacy and development by 

nearly a third. 

4

Fortunately, Congress has the last word on how much we spend 

on foreign policy priorities, and I will continue to fight for a robust 

investment in these areas. So I look forward to hearing from our 

three excellent panelists on these issues. 

And I thank you again, Mr. Chairman, for calling attention to 

this issue. 

Chairman ROYCE. Thank you very much, Mr. Engel. 

So this morning we are pleased to be joined by a distinguished 

panel, which includes Ms. Mary Ellen Iskenderian. She is president 

and CEO of Women’s World Banking, which is a nonprofit devoted 

to helping low-income women in developing countries access key financial tools and resources. 

And we have Dr. Tavneet Suri, associate professor at the MIT 

Sloan School of Management. She focuses on the impact of digital 

finance services in developing economies. 

And we have Ambassador Melanne Verveer, who served as the 

former Ambassador-at-Large for Global Women’s Issues at the 

State Department. She currently is the executive director of the 

Georgetown Institute for Women, Peace and Security. 

Without objection, the witnesses’ full prepared statements will be 

made part of the record. Members are going to have 5 calendar 

days to submit any statements or questions or any extraneous material for the record. And if we could ask everyone to summarize 

your remarks that would be best, and then we will go to the questions. 

So, Ms. Iskenderian, if you would like to start. 

STATEMENT OF MS. MARY ELLEN ISKENDERIAN, PRESIDENT 

AND CHIEF EXECUTIVE OFFICER, WOMEN’S WORLD BANKING 

Ms. ISKENDERIAN. Thank you, Mr. Chairman. 

Members of the House Foreign Affairs Committee, thank you for 

inviting me to speak with you today. My name is Mary Ellen 

Iskenderian, and I am president and CEO of Women’s World Banking. 

For nearly 40 years we have listened to low-income women in developing countries describe their need for financial services and 

then worked with local banks, insurance companies, and, increasingly, cell phone companies to tailor convenient and affordable savings, insurance, and credit products to meet those needs. Women’s 

World Banking currently works with 49 partners in 32 countries to 

reach 44 million clients. 

But Women’s World Banking can’t do this alone. The Global 

Findex tells us that 1.1 billion women, more than half of the 

world’s unbanked population, do not have an account at a bank, 

while hundreds of millions more do not have access to the full set 

of financial products. In addition, women own roughly one-third of 

the 200 million businesses in emerging economies that have no or 

insufficient access to credit. 

Providing these women with basic financial services, that fundamental first step toward economic empowerment, can unlock unprecedented economic growth and job creation and can have a direct impact on development outcomes such as health, education, 

food security, and water and sanitation. 

5

Women spend, save, and invest money in profoundly different 

ways than men. One such difference: When women have discretion 

over their financial choices they prioritize spending on their families. On average, women spend 90 cents out of every dollar earned 

on education, healthcare, and housing, in comparison to men’s 60 

cents. 

Improving a woman’s financial access brings with it a multiplier 

effect that will be critical to realizing the potential of financial inclusion for reducing poverty and driving economic growth. 

I am pleased to note that you have entitled this hearing ‘‘Beyond 

Microfinance.’’ The traditional microfinance institutions established 

an important principle: Low-income people and women in particular can borrow responsibly. But over the years we have learned 

that, like all of us, low-income people have complicated financial 

lives that require more than just a one-size-fits-all microloan. 

Fortunately, a broad range of providers, including mainstream 

commercial banks and insurance companies, as well as payments 

providers, mobile network operators, and fintech companies, has 

emerged to meet these needs. 

Yet low-income women face a number of barriers that hinder 

their access to these services. I will touch briefly on just three of 

them along with some potential solutions. 

First, millions of women lack the documentation and other forms 

of identification to open even a simple savings account. India has 

recently implemented an innovative biometric ID system that has 

dramatically expanded access to financial services. Elsewhere, 

tiered ‘‘know your customer’’ requirements allow women to open 

no-frills savings accounts with minimal documentation. 

The second barrier women face is a lack of collateral. Women 

generally have fewer assets to pledge to a bank and in many countries are legally barred from owning or inheriting land. In response, some countries have established movable collateral registries that better reflect the types of assets women can provide to 

satisfy bank requirements. 

Finally, more than 1.7 billion women in low- and middle-income 

countries do not even own a cell phone. This lack of access to technology, combined with lower financial and digital literacy, prevents 

them from fully utilizing digital financial services. Once women 

gain access to their own phone and some basic training, however, 

their usage levels parallel men’s. 

Despite these barriers, I am optimistic about the opportunities 

presented by women’s financial inclusion. The United States can 

play an important role in accelerating those opportunities by joining other developed countries that are investing in women’s financial inclusion, often led by their country’s gender Ambassadors. 

The United States can use its influence at the G-20 and other 

fora to push for implementation of more national financial inclusion strategies that have explicit gender targets. USAID, OPIC, 

and even Ex-Im could catalyze more private sector investment by 

including requirements in their programs to serve women. They 

could also engage in public-private partnerships that serve to 

derisk private sector investment. 

6

Distinguished committee members, thank you for calling attention to the role that women’s financial inclusion plays in building 

stronger families, communities, and economies. 

[The prepared statement of Ms. Iskenderian follows:]

7


26222a-1.eps

Mary Ellen lskenderian, President and CEO, Women's World Banking 

House Committee on Foreign Affairs 

July 12, 2017 at 10:00AM: "Beyond Microfinance: Empowering Women in the Developing 

World" 

Members of the House Foreign Affairs Committee, thank you for inviting me to address you 

today. My name is Mary Ellen lskenderian and I am President and CEO of Women's World 

Banking. For nearly 40 years, we have listened to low-income women in developing countries 

describe their needs for financial services and then worked with local banks, insurance 

companies -and increasingly- cell phone companies -- to tailor convenient and affordable 

savings, insurance, and credit products to meet those needs. Women's World Banking currently 

works with 49 partners in 32 countries to reach 44 million clients. 

But Women's World Banking can't do this alone. The Global Findex tells us that 1.1 billion 

women - more than half of the world's unbanked population -- do not have an account at a 

bank, while hundreds of millions more do not have access to the full set of financial products. In 

addition, women own roughly one-third of the 200 million businesses in emerging economies 

that have no or insufficient access to credit. Providing these women with basic financial services 

-that fundamental first step toward economic empowerment-- can unlock unprecedented 

economic growth and job creation and can have a direct impact on development outcomes such 

as health, education, food security, and water and sanitation. 

Women spend, save and invest money in profoundly different ways than men. One such 

difference: when women have discretion over their financial choices, they prioritize spending on 

their families. On average, women spend 90 cents out of every dollar earned on education, 

health care, and housing, in comparison to men's 60 cents. Improving a woman's financial 

access brings with it a "multiplier effect" that will be critical to realizing the potential of financial 

inclusion for reducing poverty and driving economic growth. 

I'm pleased to note that you have entitled this hearing "Beyond Microfinance." The traditional 

microfinance institutions established an important principle: low-income people- and women in 

particular-- can borrow responsibly. But over the years we've learned that, like all of us, lowincome people have complicated financial lives that require more than just a "one size fits all" 

microloan. Fortunately, a broad range of providers, including mainstream commercial banks 

and insurance companies as well as payments providers, mobile network operators and fintech 

companies has emerged to meet these needs. 

Yet low-income women face a number of barriers that hinder their access to these services; I'll 

touch briefly on just three of them along with some potential solutions. First, millions of women 

lack the documentation and other forms of identification to open even a simple savings account. 

India has recently implemented an innovative biometric 10 system that has dramatically 

expanded access to financial services. Elsewhere, tiered "Know Your Customer" requirements 

allow women to open "no frills" savings accounts with minimal documentation. 

The second barrier women face is a lack of collateral. Women generally have fewer assets to 

pledge to a bank and in many countries are legally barred from owning or inheriting land. In 
8


26222a-2.eps

response, some countries have established moveable collateral registries that better reflect the 

types of assets women can provide to satisfy bank requirements. 

Finally, more than 1.7 billion women in low and middle-income countries do not even own a cell 

phone. This lack of access to technology combined with lower financial and digital literacy 

prevents them from fully utilizing digital financial services. Once women gain access to their own 

phones and some basic training, however, their usage levels parallel men's. 

Despite these barriers, I am optimistic about the opportunities presented by women's financial 

inclusion. The United States can play an important role in accelerating those opportunities by 

joining other developed countries that are investing in women's financial inclusion, often led by 

their country's Gender Ambassadors. The United States can use its influence at the G20 and 

other fora to push for implementation of more national financial inclusion strategies that have 

explicit gender targets USAID, OPIC and even Exlm could catalyze more private sector 

investment by including requirements in their programs to serve women. They could also 

engage in public-private partnerships that serve to "de-risk" private sector investment. 

Distinguished committee members, thank you for calling attention to the role that women's 

financial inclusion plays in building stronger families, communities and economies. 
9

Chairman ROYCE. Dr. Suri. 

STATEMENT OF TAVNEET SURI, PH.D., ASSOCIATE PROFESSOR OF APPLIED ECONOMICS, SLOAN SCHOOL OF MANAGEMENT, MASSACHUSETTS INSTITUTE OF TECHNOLOGY 

Ms. SURI. Thank you, Mr. Chairman Royce, Ranking Member 

Engel, and members of the committee for hosting this hearing and 

giving me the opportunity to provide testimony on empowering 

women in the developing world. I would like to offer three main 

messages today. 

First, although there has been truly remarkable progress in alleviating global poverty across the world, the progress of women has 

not kept up with that of men. We have a long way to go toward 

gender equality in the developing world. For example, only 39 percent of the total workforce is female, only 38 percent of businesses 

are female-owned even in part. 

Second, all that said, it turns out that a number of private sector 

digital financial technologies are helping even poor women in remote areas join the economy and manage their money more effectively with profound effects on their economic status and empowerment. 

Third, to date, though the private sector has created and provided these tools at scale, international aid played a critical role. 

In this case millions of digital transactions each day in poor countries can be traced back to be a small decision by the U.K.’s international development agency to fund a pilot of a new idea. Good, 

data-driven thinking which brings together government and private sector innovations can bring big payoffs. 

This hearing is aptly titled ‘‘Beyond Microfinance.’’ For many 

years microfinance was thought to be key to lifting poor women out 

of poverty. We now have very strong evidence from seven different 

countries showing that it simply does not. There is now a consensus amongst economists that this method of putting poor people 

into debt is not an effective long-term poverty solution. 

But there are new findings suggesting that another area of finance does empower women: Mobile money. In the U.S., services 

like Venmo or Apple Pay are just taking off. So it may be surprising to hear that Kenya’s mobile money system, M-PESA, has 

been around for 10 years. It lets people send money to one another 

with just a text message, so it works even on the simplest mobile 

phones. 

And this technology has taken the developing world by storm. 

There are twice as many mobile money payments every day as 

there are PayPal ones. There are over 400 million accounts in the 

developing world, more than half of these in sub-Saharan Africa 

alone. 

With my colleague Billy Jack at Georgetown, over the past 8 

years I have been studying what happened to communities in 

Kenya as M-PESA spread across the country. The first thing we 

saw was how families deal with financial emergencies. The poor 

are never more than one emergency away from financial disaster. 

When a child gets sick, you will do whatever you have to do help 

them get better. The same holds for Kenyans, but in many families 

10

this meant reducing the amount of food, other basic necessities, or 

even pulling their kids out of school to be able to pay for medicine. 

When M-PESA arrived, families could now phone a friend for 

help. They could get money from a cousin across the country or a 

friend in the city. Then in turn, when that friend had an emergency, they would repay the favor. 

A few years later we looked at the broader impacts of mobile 

money. When M-PESA came to an area, it reduced poverty, it lifted 

an estimated 194,000 households, 2 percent of Kenyan households, 

out of extreme poverty. 

When we dug deeper, we found something we are not used to 

seeing: The anti-poverty effects were much stronger for women. In 

fact, an estimated 186,000 women in Kenya were able to switch 

from subsistence farming into business and sales occupations. 

Just giving women more privacy, flexibility, control, and the ability to manage the kinds of financial risks they face seems to have 

been a massive economic boon to them. And all that from a simple 

technology. Remember, it doesn’t give people cows or loans or any 

entrepreneurial savvy that they didn’t have before. 

Our results on women’s empowerment are now supported by 

‘‘fresh off the presses’’ work showing that cash grants have effects 

on male-run businesses and not on female-run businesses. But this 

is in part because even when women are given cash, often their 

husbands control where it goes. And in India, making government 

welfare payments electronic and giving women control of those payments by depositing the cash in their bank accounts improved their 

economic outcomes. 

One key message from the M-PESA story is how it started: An 

idea of two employees at the private cell phone company Vodafone 

in the U.K., a pilot paid for by the U.K.’s equivalent of USAID, and 

a resulting, scalable, highly profitable business model. 

There is essentially no private sector R&D in developing countries and aid money here acted as crucial R&D capital for the firm. 

Supporting these sorts of digital innovations and technologies will 

be key to closing the gender gap in economic opportunities in the 

developing world. 

Thank you again for having me, and I will look forward to any 

questions you might have. 

[The prepared statement of Ms. Suri follows:]

11


26222b-1.eps

TESTIMONY OF 

PROFESSOR TAVNEET SURI, MIT SLOAN SCHOOL OF MANAGEMENT 

before the 

U.S. HOUSE COMMITTEE ON FOREIGN AFFAIRS 

"Beyond Microfinance: Empowering Women in the Developing World" 

Wednesday July 121

h 2017 

Let me start by saying that the world has made remarkable progress in alleviating global poverty. 

Without a doubt, for most of the world's population, now is a much better time to be alive, than 

even thirty years ago. This has happened, not in small steps, but in amazing leaps and bounds. In 

1981 an estimated 44 percent of the world's population was living in extreme poverty, (living 

daily on less than what $1.90 buys in the U.S.). Tn 2013, that number had dropped to a quarter of 

that, 11 percent. 1 

That said, women's progress has not kept up with men's in many areas. But, new waves of 

research are discovering a promising new area, the growth of digital financial tools that help 

even poor women in remote areas join the economy and manage their even limited means more 

effectively. This in turns appears to spur increases in women's economic empowennent. 

The financial tools I am speaking about were made possible by an innovative government grant. 

In this case, millions of private sector digital transactions each day in poor countries can be 

traced back to a small decision by the UK's international development agency to fund a pilot of a 

new idea. When government agencies commit to innovation, small grants can lead to large 

outcomes by bringing in private sector actors. As in the UK, we are starting to see similar 

innovation within the broader U.S. international aid community, using Silicon Valley style 

investments. Norfund, a private equity company, established and funded by the Norwegian 

government, is also a great example. Good data-driven thinking, which brings together 

government and private sector innovations, can bring big payoffs. 

lam here today to talk about what we have learned most recently in women's economic 

empowerment in developing countries, and particularly how the spread of new financial tools is 

affecting women's lives. Gender equality is one of the Sustainable Development Goals (SDGs) 

set forth by the UN, an agenda set out to ensure global prosperity. It is well documented in the 

developing world that women lag behind men in economic access and outcomes. For example, 

only 39% of the total workforce in low and middle income countries is female; only 38% of 

firms have any female participation in ownership; and only 22% of seats in national parliaments 

are held by women. 

1 Based on World Bank dma. Roser, M. and E. Orti/.-Ospinn. 2017. Global E'treme PO\erty. Published online at 

OurWorldlnData.org. Retrieved from: https:l/mmvorldindata.org/extreme-poverty/. 
12


26222b-2.eps

These statistics show that we have a long way to go towards gender equality in the developing 

world. However, new findings from rigorous research point to opportunities for women to 

become more empowered and economically self-sufficient. These come thanks to a number of 

new financial tools that bring simple economic capabilities many women have historically lacked 

to anywhere within reach of a mobile phone network. In particular, the findings point to the 

catalyzing role governments can play in paving the way for private sector innovation. 

As such I will focus in my testimony on two important components. The first component is 

women's access to financial services and their financial wellbeing. The second component is 

enhancing the use of enabling technology, in particular infonnation and communications 

technology, to promote the empowerment of women. These two aspects have fundamental 

effects on women's economic opportunities and whether they are able to move out of extreme 

poverty. As Figure I shows, the percentage of women having their own account at any financial 

institution is not just low, but it lags behind that for men across most of the developing world. As 

my testimony will highlight, digital technology is key to expanding the access of women to a 

wide variety of tools that enhance their economic wellbeing. 

1. Financial Health and Wellbeing: The Role of Mobile Money 

In economics, we use the term "financial health" as a shorthand for the ability to use basic tools 

you and I take for granted to manage our daily tinanciallives. These include access to a bank 

account to save for the future and buffer against hard times, to payment systems for conducting 

business, and insurance, so that we don't have to borrow and go into debt when inevitable life 

setbacks occur. These tools are all the more important for the world's poor, who on any given 

day, may only have a dollar or two of solvency they have to use wisely to keep their families 

going and stay above financial disaster. 

We know though, that by and large, the worlds' poor are not poor because of bad decision 

making, they are poor because they were born in poor locations and in poor circumstances. But 

data trom every corner of the globe shows us time and again that when they get access to the 

basic financial tools that you and I use every day, they start to engage in commerce, save, and 

make good financial decisions. Women in particular, start to become more empowered and 

financially self-sufficient and more economically successful when they get the ability to malce 

secure and private payments. 

I want to discuss one example from my research of how important financial health is for women 

in the developing world. That is the example of mobile money, essentially an "app" that works 

on ''dumb" phones via old fashioned text messages, allowing anybody with even the most basic 

mobile phone to deposit, transfer and withdraw money from an account on their phone without 

actually owning a bank account. Imagine Apple Pay, Pay Pal or Venmo but without a credit card 

or bank account behind the payments. Mobile money is distinct from mobile banking as there are 

no bank accounts behind each mobile money account, just a phone number tied to a virtual 

account and a digital record of the money in and the transactions on your account. 
13


26222b-3.eps

However, easy as it is to transmit money over wireless networks, at the end of the day, one still 

needs to be able to put cash in and get cash out. Though a mobile money account feels like a 

bank account for a consumer, the back end is quite ditl'erent. The money in a mobile money 

account is virtual and it trades one for one with cash (minus a transaction account for 

withdrawals and for sending money to another phone). When a customer deposits money in his 

mobile money account he will do so at a mobile money agent and he is, in fact, purchasing an 

equivalent amount of virtual money. The agent he deposits at must therefore have a stock of 

virtual money to "sell" to the consumer. These agents therefore provide the cash in/cash out 

services for a consumer: they have to go to an agent to deposit or withdraw cash. The primary 

role of the agent is to manage the stocks of cash and virtual money he holds. 

Who are these agents? They are all existing business and entrepreneurs who sell prepaid phone 

credit or are small businesses selling basic groceries, existing gas stations, drug stores, tailors, 

etc.- common small, often informal businesses which exist even in the most remote villages. As 

of December 2014, there were about 2.5 million agents globally, with the network growing at 

25.2% annually2 

Given the mobile phone is now ubiquitous in the developing world (with a billion subscribers in 

India and over 680 million in Sub-Saharan Africa), mobile money has been quickly adopted as 

an easy add-on to the mobile phone. There are now over 270 mobile money services (most 

offered by telecommunications companies or private entrepreneurs) across 93 different countries 

and over I 00 more services planned in the near future. There are more mobile money accounts 

than bank accounts in 19 countries, and there are at least ten times as many mobile money agents 

as bank branches in 3 7 countries. There are over 400 million accounts in the world, over 220 

million in Sub Saharan Africa, and over 30 million transactions are completed a day (more than 

twice PayPal across the world). 3 Fit,>ure 2 shows the adoption of mobile money accounts across 

the world. 

Let me now turn to what mobile money actually does and why it improves economic 

opportunities for women. This is based on research I have been conducting over the past eight 

years on the most prominent mobile money service in the world, which is in Kenya and is called 

M-PESA (M for mobile and PESA means money in Swahili). 

Over the past eight years, we have studied the adoption and impacts of mobile money in Kenya. 

Towards the end of my testimony, I will talk about innovations that have followed M-PESA in 

Kenya and the role of technology in expanding women's economic opportunities further. 

The story behind M-PESA is an interesting and relevant one. The idea came trom Britain, trom 

two employees at Vodafone who thought up this technology as a way for individuals to pay off 

:The requirements to become an agent vary across countries. Finally. the cash deposited in mobile money accounts 

is ultimately held in the banldng systcnt often pooled in one or l\VO tmst accounts in particular banks. The consumer 

who has an account has mvncrship over this tmst account and their value of digital money is recorded in the tmst 

account but they ccnmot interdct \Vith the tn1st account through banks. they have to use the mobile money agents 

across the country to deposit or \'vithdraw money. 

' Sec Groupe Speciale Mobile Association (GSMA), 2015. Stntc of the industry: Mobile Fimncial Services for the 

Unbanked. 
14


26222b-4.eps

microfinance loans digitally. They raised money (a challenge grant) from the UK government's 

equivalent of USAID, the Department for International Development, to pilot the technology in 

Kenya. The pilot led to a very ditierent product and hence business model than originally 

thought but also led to the fastest adopted digital technology in the world. 

Why was M-PESA so popular? The reason is that it filled a very core and basic financial need 

for individuals in Kenya and is doing so across the developing world now. 

A key component of financial wellbeing is something we refer to as financial resilience, i.e. how 

people manage risk. 4 lt is the ability of individuals to deal with unexpected setbacks that happen 

in their lives. Financial resilience is a function of three core aspects of an economy: (i) access to 

banks and the ability to save money in these banks for a rainy day, (ii) access to private markets 

for insurance (for example health insurance), and (ii) the extent the government provides social 

safety nets (for example, unemployment insurance). Tn the developed world, these three 

segments are important to financial resilience. In the developing world, bank accounts are not 

easy to access (see Figure 1 ), only the very rich can afford private insurance and the 

governments often do not have large budgets for social safety nets. What does this mean for poor 

households in these economies" 

The poor, even those who eke out a living, are never more than one drought, tlood, or illness 

away from personal disaster. Given how risk is a pervasive part of their lives, 5 how do poor 

households in these economies survive" One way the poor manage risk is through what we call 

"infonnal insurance"- which is an economist's way of saying borrowing from a friend when 

you get into trouble, and only paying back when they get into trouble. This essentially means 

they use their social networks as insurance. For any kind of insurance to work, you need the 

person helping you out to be in a better situation than yourself, and borrowing from a friend is no 

different. If you are a farmer suffering through a drought, your neighbor is probably in the same 

situation, so you will want to borrow from someone who looks as different from you as possible. 

Typically that means someone far away. In these countries it used to be very difficult and 

expensive to transport cash across a long distance. It would have to pass through several sets of 

hands and usually a bus ride or two. Each time it the cash from your distant friend or cousin 

changed hands on its way to help you meant more expense and risk. 

There has been over twenty years of research documenting these infonnal insurance relationships 

in a wide variety of developing economies, showing they do have impacts on financial resilience 

and economic wellbeing. However, they are far from perfect since moving cash over distances in 

these economies is difficult and comes with costs and risks. And, the further away your social 

network, the more expensive and difficult it is to share money and hence insure yourself. These 

costs that we refer to as transaction costs ultimately limit the extent of your insurance network by 

1 Both the Center for Financial Services Innovation and the Consmner Financial Protection Bureau include resilience 

as part of Uteir definitions of financial well-being. CFSI includes ··ability to be resilient in the face of inevitable ups 

and downs". and CFPB included "capacity to absorb a financial shock". 

~ The unexpected bad events we studied in our \York on Kenya were: death or ilh1ess of a household member, 

accidental or violent il~ury. loss of employment. failure/loss of business. death oflivestock. crop disease. theft. 

robbery. burglary. assault. fire, drought, noods and unexpected price rises. Just under half or households report 

experiencing one such event in our data. 
15


26222b-5.eps

limiting the distance these networks can engage and hence what sorts of risks can be mitigated. If 

l only need a few dollars to buy some medication, it makes no sense to spend several dollars in 

transaction costs to get me the money. 

In 2007, before M-PESA was introduced, the average Kenyan would have to walk about 6 miles 

each way to get to a bank6 So, how did the money for infonnal insurance travel around? It 

would largely be transported in person or via buses. With the launch ofM-PESA, these distances 

effectively shrunk dramatically. There are currently over 130,000 mobile money agents in Kenya 

(there is an order of magnitude smaller number of bank branches in the country). The average 

transaction in 2008 travelled 200km for just 35 cents, as opposed to a $4.60 bus ride. By 2015, 

68% of Kenyans lived within a 15 minute walk of an M-PESA agent 7 Financial resilience 

transactions were suddenly safer, cheaper, easier and quicker. 

Now what does all this have to do with women? Let me discuss our findings on M-PESA. 

Between 2008 and 2014, we collected data on households across most of Kenya to understand 

the impacts ofM-PESA. Over these eight years we have two key headline sets of findings. 

In our first studies, 8 we showed that M-PESA improved financial resilience. We find that when 

unexpected setbacks happen, those with access to M-PESA are able to manage their lives better. 

We measure this by looking at how much households have to reduce their expenditures when an 

unexpected bad event happens, i.e. if an income earner gets sick or if there is a drought, does the 

loss of income imply that the household can no longer atJord to purchase food and necessities for 

themselves. If there is a reduction in expenses at the time of a bad event, then the household is 

not financially resilient. We found that M-PESA improved resilience- when something bad 

happens, households with access to the technology did not have to reduce their expenditures as 

much 9 The response of households to health events is particularly instructive as an example (as 

illustrated in Figure 3 ). When households in Kenya have an unexpected health crisis, they will all 

spend on medication, irrespective of whether they are extremely poor or not, irrespective of 

whether have access to M-PESA or not. However, those without access to M-PESA will have to 

take the money they spend on medication out of their budget for other items, in particular they 

reduce food spending and non-food spending, specifically education. For those households with 

access to M-PESA, they are able to not just spend on medication but also increase their expenses 

on food and other items that may be of help. 

6 J2% of Kenyan households liYed more than I 0 km from a bank branch and 19% more than 20 km from a bank 

branch. 

The average distance to an M-PESA agent was under a mile by 2015. 

' See SurL T.. Jack, W. and Stoker. T.M., 2012. Documenting the Birth of a Financial Economy. Proceedings of the 

National Academy of Sciences, 109(26). pp.l0257-10262. Also see Jack. W. and Suri. T.. 201~. Risk Sharing and 

Transactions Costs: Evidence from Kenya's Mobile Money Revolution. The American Economic Revie\v, 10-1-(1), 

pp.l83-223. 

lj For similar results on resilience in Bangladesh_ see Lee, J.. J. Morduch_ S. Ravindma A Shonchoy, and H. Zaman, 

2017. Poverty and Migration in the Digital Age: Experimental Evidence on Mobile Banking in Bangladesh. 

Working Paper. Similar findings in Tarv.ania from Riley E. 2016. Mobile Money and Risk Sharing Against 

Aggregate Shocks. Working Paper. 
16


26222b-6.eps

The reason they are able to do this is that they are able to reach out their social networks for help 

-we see that when there is a health setback, they are more likely to receive help, they receive 

more help (more money on their phones) and they receive help from more different types of 

people. Since the fee for sending money on M-PESA is not related to physical distance, 

households with access to M-PESA are able to expand their insurance networks to people who 

look different from them and who live far away, further improving the efficiency of these 

informal insurance networks. 

Our second study used the latest data from 2014 to trace out what the longer term impacts ofMPESA have been in Kenya. 10 In particular, we find that access to M-PESA reduced extreme 

poverty in Kenya: it lifted an estimated 194,000 households (2% of Kenyan households) above 

the threshold for extreme poverty. But, interestingly, we find that these impacts are significantly 

larger for female-headed households. In addition, we find that these results are driven by the 

improvements in financial resilience and increased savings. But, more importantly, that when MPESA expanded to a new area, women (both in male-headed as well as female-headed 

households) changed their main occupation from farming to business or retail. We document that 

an estimated 186,000 women across Kenya switched occupations in this way. 

Why are there impacts in particular for women? Though the study was not able to pinpoint why 

this may be, we have a number of hypotheses on why a technology like M-PESA affected 

women's economic opportunities. First, as our initial studies highlighted, M-PESA was able to 

improve financial resilience. This should then allow individuals to rely on this to make higher 

risk, higher return investments, knowing that if something goes wrong, they have a network to 

depend on to insure that risk. Second, it may have given women control over an aspect of their 

finances. Before M-PESA, since a lot of these person to person transfers were delivered in 

person, they were very public. Everyone in the household and perhaps even neighbors knew 

money had arrived and it is likely that the male head of household would have control over the 

money. M-PESA allows individuals privacy over financial transactions even within a household. 

Women can receive money that is sent directly to them from their friends and family and 

therefore may have more control over that money. Finally, it could be that mobile money allows 

women to save more easily and they are then able to invest these savings into a business. 

2. What About Other Financial Services 

I am conscious that the hearing today mentions going beyond microfinance, which is particularly 

apt. Although microloans are very popular, we now have a very large and credible body of 

research showing that the economic impacts of microfinance are, on average, close to zero. They 

are a good business, but studies from all over the world show the same thing- putting poor 

"'Sec Suri, T., and W. Jack. 2016. The Long-run Poverty and Gender Impacts of Mobile Money. Science Vol. 35~. 

No. 6317 (2016): 1288-1292. 
17


26222b-7.eps

people into debt is not an etl'ective poverty solution. The loans benefit only a few specific types 

of individuals and do not lead to any systematic improvements in women's empowerment. 11 

Similarly, we now have a body of work around micro enterprises (very small businesses). 

Studies trom Ghana, Sri Lanka and Mexico all show that when a business does get cash, through 

a grant or a loan, male-run businesses do better, but not female-run businesses. 12 However, the 

gender gaps are not just due to differences in ability, risk aversion or attitudes towards 

entrepreneurship. Follow-ups to this work are now starting to show that this often happens 

because even when the money goes to the women running a business, her husband often controls 

where the money is spent. 13 It seems that, therefore, allowing women the ability to have financial 

privacy and control over their incomes or investments could provide value- this fits nicely with 

our findings on M-PESA. 

A recent paper also shows that village savings groups (that are comprised of mostly women) that 

have near zero transaction costs improve resilience and facilitate savings and investment and also 

improve women's empowerment, increasing their int1uence on a wide variety of decision making 

in the household (including decisions about household businesses). 14 These results paint the 

same picture as our results on mobile money for women. 

Finally, it is worth mentioning a new literature on savings accounts for women, though this is 

very early stage work. As India digitizes their economy, they have rolled out a universal ill 

system and linked that to the distribution of government transfers, which has led to a dramatic 

reduction in leakages and corruption. 15 Similarly, a study in Niger on cash transfers to 

households showed that switching trom a cash transfer to a digital transfer on mobile money led 

to more discussion within the household on how the cash transfers would be spent, increases in 

standard measures of women's empowerment and ultimately higher diet diversity and more 

meals consumed by children. 16 New work shows that allowing women recipients of these 

transfers to have their transfers linked to and deposited directly into their own bank accounts 

improves the probability they work and their earnings in India. 17 

11 Innovations for Poverty Action and Abdul Latif Jameel Poverty Action Lab, Policy Brief, 

Credit is Due_ available online 

Woodmff, C. S. de Mel. and D. McKenzie. 2012. One-time Transfers of Cash or Olpital have Long-lasting 

Effects onMicroenterprises in Sri Lanka. Science 335 (6071) 962-6. Also see Woodmfl C. S. de Mel, and D. 

McKcruic. 2009. Arc Women more Credit CotiStraincd? Experimental E\idcncc on Gender and l\.1icrocntcrprisc 

Returns. AEJ-Applicd Economics I (3) 1-32. 

u See Bernhardt, A, E. Field. R. Pande, and N. Rigol. 2017. Household Mallers: Revisiting the Returns to Capital 

Among Female Micro-entrepreneurs, Working Paper. 

"See KarlaiL D., B. Savonitto, B. Thuysbaert, and C. Udry. 2017. Impact of Savings Groups on the Lives of the 

Poor. Proceedings of the National Academy of Sciences. 114 (12). 3079-3084. The study covers [,>roups in Malawi. 

Uganda and Ghana. 15 See Muralidhara11 K. Niehaus P. Sukhlarikar S. 2016. Building State Capacity: Evidence from Biometric 

Smartcards in1ndia. American Economic Review, 106(10):2985-29. 16 Sec Akcr, J.. R. BounmijcL A McClelland, and N. Tierney. 2016. Payment Mechanisms and Anli-Povcrty 

Programs: Evidence from a Mobile Money Cash Transfer Experiment in Niger. Economic Development and 

Cultural Change. 65(1). 1 ' Sec Field. E .. R. Pandc, N. Rigol, S. Schaner. and C. Troyer-Moorc, 2017. An Account of One's Own: Can 

Targeting Benefits Payments Address Social Constraints to Female Labor Force Parhcipation'' Working Paper. 
18


26222b-8.eps

All this early stage work highlights the importance of digital technologies in growing the access 

and use of a variety of financial services by women, services that allow them to improve their 

economic wellbeing. 

3. Future Innovations iu Financial Services 

Where to from here? Clearly, for the Kenya case, the digital technology component of M-PESA 

was essential to broadening access. The Kenya example also makes a good case for what may 

come next. In 2011, the telecom company in Kenya partnered with a bank to offer a fully digital 

bank account (called M-Shwari), now also otl'ered in Tanzania, Rwanda, Uganda and Cote 

d'Tvoire, and by other banks and entrepreneurs (including two companies from San Francisco) in 

Kenya. With these digital bank accounts, individuals can use their mobile phones to open a bank 

account, deposit money, save and earn interest, withdraw money, request a loan, etc. The deposit 

and withdrawals happen via M-PESA. Underlying the loan decision is a credit scoring rule that is 

based on the individual's history of interactions with their phone and their mobile money 

accounts and sometimes their social networks. There are no loan officers, no bank tellers, and in, 

fact, no rural bank branches. Once the mobile money infrastructure is extensive, it is trivially 

simple to layer on digital financial services. The digital aspect allows the private sector providing 

these services to dramatically lower costs: they do not need bank branches as the existing mobile 

money network provides the cash in and cash out services, they do not need loan officers as 

algorithms and data allow them to evaluate credit risk, etc. The costs of provision are just 

dramatically lower in a digital system. 

In addition, the telecommunications companies can also layer on a variety of business to 

consumer and consumer to business payment options on mobile money as has happened in 

Kenya. W ork:ing with government, it is also possible to layer on government transfers that, 

instead of being handed out in cash, are deposited digitally into recipient accounts, as is 

happening in India. 

Finally, one new layered on service in Kenya is worth mentioning and we are currently running a 

study to evaluate its impacts on both male and female entrepreneurs in Kenya. Two weeks ago, 

the Kenyan Treasury (in partnership with the Nairobi Stock Exchange and the 

telecommunications company) launched a digital 3-year government bond called M-Akiba that 

can be purchased and sold live in the bond market entirely on any mobile phone. 18 This bond is 

being marketed as a savings vehicle for low income households as the minimum investment 

required is only $30 and it pays a 10% interest per annum. The government is trying to raise 

$50m through this bond issue (they already piloted a $1.5m issue in March 20 17). 

The big question is then how do we get digital technologies to individuals in the developing 

world? Who is creating them, who is scaling them? Mobile money has largely been a private 

sector initiative but l think it provides an interesting example. Much as the technologies are 

being built and provided by private sector telecommunications companies in the developing 

111 Individuals usc the Know Your Customer (KYC) behind their mobile money accounts to open a Central 

Depository System account through their mobile phone in a few key strokes. 
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26222b-9.eps

world, the story has some nuance. The Kenya case is by far the most successful and well-known 

in the developing world. But, the initial investment in piloting the technology was provided by 

the UK Government's Department for International Development, the UK counterpart to 

USAID. Even a private sector company the size of Vodafone was not willing to experiment and 

test the technology and the idea without some seed money from an aid organization. However, 

the piloting was absolutely essential to the success of the service. The initial idea was forMPESA to be a way to pay off microfinance loans. However, very few Kenyans have microfinance 

loans. When the system was piloted, the company realized that people wanted to use it to send 

money to their friends and family. The company then re-branded the product and, more 

importantly, built the right business model for this service. The crucial component was to build 

an extensive agent infrastructure for cash in and cash out. lf the main use of the service was 

going to be sending money long distances, there would need to be agents everywhere in the 

country. This is one of the key reasons M-PESA has been so successful: not just the technology, 

but the business model to go along with the main use of the technology. 

Clearly, the ability of the private sector to innovate on business models and to scale such 

technologies is unquestionable. However, it seems that the initial risks may need to be seeded. 

There is essentially no private sector R&D in the developing world, yet that component is 

essential. This is a role that clearly aid organizations and donors can play. 

Digital technologies and fintech are booming in terms of private investment in some parts of the 

world. For example, the value of global fintech investment in 2015 was $22.3 billion, with the 

US having the largest share, receiving $4.5 billion in new funding in 2015. China had nearly $2 

billion, India: $1.65 billion and Germany: $770 million. While the growth in investments in 

Asia-Pacific have been dramatic (a fivefold growth between 2014 and 2015), there has been little 

investment in Sub-Saharan Africa where mobile money systems have no doubt been the most 

popular. Given that Sub-Saharan Africa has some of the poorest economies in the world, they 

may also be the economies where the returns to fintech investments are the highest, as illustrated 

by the case of mobile money in Kenya. Seeding the financial innovations that can build otT the 

success of mobile money and upgrade digital access to the entire spectrum of financial services, 

especially to women, could potentially have large gains and spur further investments into fintech 

in the developing world. 
20


26222b-10.eps

Figure 1: Bank Account Ownership and Use by Gender in the Developing World 

Ownership Use 

Note: The numbers for high income OECD countries are at 9-t% for both males and females 

Figure 2: Mobile Money Accounts Across the World 
21


26222b-11.eps

Figure 3: The Response to Health Shocks in Kenya for M-PESA Users and Non-Users 

0 +33.4% 

() +10.2% 

0 +4.7% 

Q +29.6"/o 

Total t 

No Shock Expenditure Medical Non-Food Food 

I 0 .. 

J 

0 -2.7% 0 -4.4% 

0 -13.7% 
22

Chairman ROYCE. Thank you. 

Ambassador Verveer. 

STATEMENT OF THE HONORABLE MELANNE VERVEER, EXECUTIVE DIRECTOR, GEORGETOWN INSTITUTE FOR WOMEN, 

PEACE AND SECURITY, GEORGETOWN UNIVERSITY 

Ambassador VERVEER. Chairman Royce and Congressman Engel 

and members of the committee, thank you for the opportunity to 

speak to you today on an issue of critical importance: Increasing 

women’s economic participation and empowerment in developing 

nations. 

Mr. Chairman, let me begin by thanking you for your leadership 

in focusing on global women’s issues. They are in the vital interest 

of the United States. Countries with declining living standards and 

inequality are more unstable and pose greater challenges to our 

own interests and our own security. 

Empowering women and girls is fundamentally a moral issue, a 

human rights issue. It is also smart and it is strategic. It advances 

our foreign policy as it tackles some of the most pressing issues 

that confront the globe and America’s leadership. 

This hearing has to do with one of the great challenges worldwide: How do we grow economies, create jobs, and ensure inclusive 

prosperity? Today there is a growing body of empirical evidence 

demonstrating the positive impact of investing in women and girls. 

From the World Bank, to the World Economic Forum, from countless think tanks and private sector analysts, we know that women 

represent one of the most powerful economic opportunities the 

world has ever seen. The McKinsey Global Parity Report found 

that closing the global gender gap could drive more than $12 trillion in growth by 2025 if—and this is a big if—much more is done 

to tackle the obstacles that continue to hold women back. 

Micorenterprise development has played an important role in lifting up women at the bottom of the pyramid. However, for them to 

grow out of their subsistence businesses is not easy. As you have 

heard, credit is not enough. An intensive package of high-potential 

interventions is required. 

Studies show that women-run SMEs are accelerators of economic 

growth. SMEs occupy that critical space in economies where jobs 

are created and economies grow. 

Yet, if women are to unleash their potential we must confront 

and reduce the barriers they confront. They face greater roadblocks 

than their male counterparts in starting and expanding businesses. 

Discriminatory laws and customs impede women’s efforts. Violence 

against women is a global scourge. In some places women have no 

rights to inheritance nor property and very little in the way of legal 

protection. 

Women often lack training, mentors, and networks. Access to 

technology, markets, and access to finance, as you have heard, is 

particularly challenging. For female entrepreneurs to unleash their 

potential, addressing these obstacles will be essential. 

Women are also vital to the agriculture sector, and in many developing countries they are the backbone of their economies. Yet 

subsistence-level women farmers do not have equal access to resources, which limits their productivity. A seminal FAO report 

23

showed that when women farmers can operate on a level playing 

field, including having land ownership, they can increase their individual yields significantly. 

Technology has the potential to revolutionize women’s lives in 

the developing world by providing critical access to information, 

mitigating health and safety risk, and creating opportunity for financial security and independence. Yet mobile technology, as essential a tool as it is, is still out of reach for many poor women. 

Its greatest impact will be in mobile banking, which enables 

women to make the financial transactions that they need and to 

keep their money safe. But the genuine good news here is that 

strides are being made in digital financial services that are indeed 

transforming women’s lives. 

The challenge we are addressing today is multifaceted, as must 

be any solution. No one investment constitutes a silver bullet. 

Many development investments are interrelated. Programs like 

women’s health, education, freedom from violence, and legal rights 

are critically important to economic empowerment, and a Federal 

budget that drastically cuts these programs will only shortchange 

women, but not only the women around the world, it will also 

shortchange the interests of the United States. 

I hope that the committee will also urge the administration to fill 

the position of Ambassador for Global Issues for the reasons that 

I have laid out in my testimony. 

Today some of the largest and most farsighted companies understand that engaging in partnerships to advance women brings benefits both to society and to companies themselves. Public-private 

partnerships recognize that no one sector has the monopoly on 

competencies that are required in this field, nor the resources, but 

together much can be achieved. And I lay out ways that companies 

today are engaged in these partnerships through value chain 

sourcing, digitizing financial services, and so much more. 

The United States should continue to catalyze, support, and participate in impactful and innovative partnerships among many 

stakeholders. 

Thank you, and I look forward to your questions. 

[The prepared statement of Ambassador Verveer follows:]

24


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TESTIMONY 

MELANNE VERVEER 

DIRECTOR, THE GEORGETOWN INSTITUTE FOR 

WOJ\1EN, PEACE & SECURITY, 

FORMER US AMBASSADOR-AT-LARGE FOR 

GLOBAL WOMEN'S ISS1JES 

HOUSE COMMITTEE ON FOREIGN AFFAIRS 

"BEYOND MICROFINANCE: 

EMPOWERING WOMEN IN THE DEVELOPING WORLD" 

JULY 12,2017 

WASHINGTON, D.C. 
25


26222c-2.eps

Chairman Royce, Congressman Engel and Members of the Committee: 

Thank you for the opportunity to speak to you today on ways to increase women's 

economic participation and empowerment in developing countries. 

Mr. Chairman, let me begin by thanking you for your leadership in focusing on global 

women's issues and the critical role women play, ranging from advancing peace and 

security and growing economies to countering violent extremism. These issues must be at 

the center of our efforts to create the kind of world we all want to see. They are in the 

vital interest of the United States. Countries with declining living standards and 

inequality are more unstable and thus pose greater challenges to our own interests and 

security. Empowering women and girls is fundamentally a moral issue- a matter of 

basic human rights. Tt is smart and strategic. Tt advances our foreign policy as it tackles 

some of the most pressing issues that confront the globe and America's leadership. 

I am also pleased to be on this panel with Mary Ellen Iskenderian, the President and CEO 

of Women's Work Banking, who has brought tremendous leadership to issues of 

financial inclusion. I'm also delighted to be here with Tavneet Suri who has done 

important work on the critical role mobile money plays in impacting livelihoods of 

women in tbe developing world. 

WOMEN AS A POWERFUL ECONOMIC FORCE 

This hearing has to do with one of the big global challenges we face: how to grow 

economies, create jobs and ensure inclusive prosperity. Today there is a growing body of 

empirical evidence demonstrating the positive impact of investing in women and girls. 

From the World Bank to the World Economic Forum, from McKinsey and Company to 

Goldman Sachs, we know that women today represent one of the most powerful 

economic opportunities the world has ever seen. In 2015, McKinsey and Company 

published the Global Parity Report and found that closing the global gender gap could 

drive between $12-28 trillion in GDP growth by 2025, if- a big if- much more is done to 

tackle obstacles that continue to hold women back. A few years ago, Booz and Company 

estimated that as many as a billion women were poised to enter the world economy over 

the next decade as employees, employers and entrepreneurs. Their impact could be as 

great as that of China or India. Other studies show that reduction in barriers to female 

labor force participation would increase the GDP of the United States by 5% and that of 

Egypt by 34%. 

Investing in women and girls creates a "double dividend." Women tend to reinvest 

upwards of90% of their earnings in their families- on education and nutrition-- which 

raises the standard ofliving. This "multiplier effect" had made advancing women and 

girls a primary goal in global development The World Bank's annual World 

Development Report a few years ago stressed the promotion of equal education and equal 

economic opportunities for women and girls. As former head oftbe World Bank, Bob 

Zoellick notes, "Gender equality is smart economics." Economically empowering women 
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is necessary to ensure their rights, their ability to realize their agency, as well as to 

advance human development. 

Women's employment takes place in the formal and informal economy, (a 

disproportionate number of women globally find themselves in the informal sector). 

Women work in agriculture, wage employment or running enterprises. Tn addition, 

women carry the burden of unpaid work in their households and of broader care 

responsibilities, which further serves to constrain their economic participation. Last year, 

the UN Secretary General's High Level Panel on Women's Economic Empowerment 

issued a call to action, underlining the urgency of actions to close gender gaps in the 

economy. The Panel's report highlighted that those working in the informal economy 

face a host of challenges that must be addressed. 

MICROENTERPRISES AND SMALL AND MEDIUM SIZE ENTERPRISES 

Microenterprise development has played a significant role in lifting up millions of 

women at the bottom of the pyramid. However for women to break out of subsistence 

businesses and grow their microbusinesses is not easy. Credit is not enough. According to 

"Roadmap for the Promotion ofWomen's Economic Empowerment," research made 

possible by Exxon Mobil Foundation, an intensive package of high potential 

interventions is necessary, including training, ongoing technical assistance, stipends and 

related elements of support. 

Studies show that women-run SME's are accelerators of economic growth. Female 

entrepreneurs are powerful growth engines in emerging economies. SME's occupy the 

critical space in economies where jobs are created and economies grow. Yet, if women 

are to be the accelerators of SME's and otherwise unleash their potential, we must 

confront and reduce the obstacles they confront. Everywhere, women face greater 

roadblocks than their male counterparts in starting and expanding their businesses. 

Discriminatory laws, customs and the values that fuel them often impede women's 

etl'orts. Violence against women is a global scourge. In some places, women have no 

rights to inheritance nor property, and very little in the way of legal protection. The 

World Bank's Women Business and the Law 2016 report found that legal impediments to 

women's economic opportunity remain on the books in 155 economies around the world. 

Women often lack appropriate training, mentors and networks. They confront obstacles 

in access to technology and markets, and access to finance is particularly challenging. A 

study by the World Bank's International Finance Corporation found that women-owned 

fonnal businesses globally have an unmet need to $260-320 billion. ln other words, 

female entrepreneurs often need multiple interventions in order to succeed. 

WOMEN IN AGRICULTURE 

Women are also vital to the agricultural sector. ln many developing countries they are the 

backbone of the economy and in some places comprise the majority of small farmers. 

Yet, their work is usually not counted as economically active employment. Subsistencelevel women farmers do not have equal access to resources, and this significantly limits 
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their potential to increase their productivity. They are often at a severe disadvantage 

when it comes to the kind of training they need, or access to resources-- from fertilizers 

to tools-- or to credit to purchase what they need to grow their output. They often do not 

have voice in the local decision-making agriculture groups and networks, and confront 

other social constraints. Although women produce half the world's food, they only own 

1% of the farmland. Land ownership is a critical element in growing the productivity and 

incomes of women farmers. The 

UN's Food and Agriculture Organization's study on the vital role women play in 

agriculture showed that when women farmers can operate on a level playing field and 

have equal access to resources that meet their specific needs, they could increase their 

individual yields by 20-30%. This in turn could improve agricultural production between 

2.5 to 5% and reduce the number of undernourished people up to 150 million globally. 

US development initiatives to combat global hunger and promote food security should 

integrate gender into all aspects of the programs, and measure results to ensure that goals 

are being met. 

WOMEN AND TECHNOLOGY 

Technology has the potential to transform women's lives in the developing world by 

providing critical access to information, mitigating health and safety risks and creating an 

opportunity for financial security and independence. Mobile technology is an essential 

tool to enable poor women to transform their lives. I have seen first hand how the simple 

cell phone is being used today to protect women from violence, to give women in the 

most remote area, access to vital health information, and to teach literacy. The cell phone 

is being used to provide small entrepreneurs and farmers with information on markets 

saving them from walking for miles needlessly -- or providing them with weather 

forecasts. Its greatest impact is mobile banking. The great majority of the poor are 

unbanked and through cell phone banking many will be able to save their earnings safely 

and engage in financial transactions as they want. There is a gender gap in cell phones. 

For some 200 million fewer women living in low- and middle-income countries owning a 

simple cell phone is still out of reach and in certain parts of the world, in South Asia, for 

example, it is larger than in other regions. But there is genuine good news here: strides 

are being made in digital financial services, such as digitizing of cash payments that are 

enabling financial inclusion for women and transforming their lives. 

US COMMITTMENT 

The problem we are addressing today is multi-faceted as must be any solution. There is 

no single solution, nor program that can advance women's economic empowerment 

significantly. No one investment provides a comprehensive answer. Furthennore, many 

development investments are interrelated. Women's health, education, freedom from 

violence and legal rights are all critically important to their economic empowennent. A 

federal budget that drastically cuts USAID, PEPF AR, the Millennium Challenge 

Corporation and State Department programs is a budget that will not only shortchange 

women around the world but also shortchange the interests of the United States in 

advancing economic prosperity, peace and security. These programs comprise less than 
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1% of the federal budget. The U.S. commitment of $50 million to the Women 

Entrepreneurs Finance Initiative to promote women's entrepreneurship in developing 

countries (that Tvanka Trump has promoted), responds to a need. I am hopeful that the 

World Bank will organize and target the resources in a way that will enable women, 

including those in the informal sector, to overcome many of the challenges to 

entrepreneurship. However, if at the same time deep cuts are enacted in crucial programs 

that support women's development, this will push back progress, for women and girls, 

including economic progress, not advance it. 

APPOINTMENT OF A US AMBASSADOR FOR GLOBAL WOMEN'S ISSUES 

I hope this committee will also urge the Administration to fill the position of 

Ambassador-at-Large for Global Women's Issues to strengthen US diplomatic efforts by 

integrating gender into the range of America's diplomatic and development interests. The 

issue on which we are focused today is an issue on which I was significantly engaged 

with my colleagues during my tenure at the State Department. It entailed working with 

the Bureau of Economics and Business Affairs to advance women's entrepreneurship and 

to promote issues like financial inclusion on the 020 and G7 agendas. It meant working 

with the Bureau of African Affairs on the Afncan Women's Entrepreneurship Program to 

enable women on the continent to advance economically through AGO A, the Africa 

Growth Opportunity Act, and the benefits it afforded for expanding markets. It meant 

working with the US Ambassador to APEC to put the issue of women and the economy 

on the APEC agenda for the first time and to catalyze women-owned SME's and enable 

them to overcome the obstacles they confront. The UN has calculated that the Asia 

Pacific region loses in excess of $42 billion a year in GDP because the potential of 

women in the region is not tapped. lt also meant working in conflict areas from 

Afghanistan and Iraq to Colombia and Kosovo- and many places in between --to 

promote women's economic opportunity and participation in peace-building. This 

position should not be viewed as partisan. It should not be considered merely a women's 

projects office, nor a "check the box" formality, but one that is integrated across the work 

of the Department to ensure greater effectiveness in achieving its mission, including 

women's economic participation and empowennent. 

PUBLIC-PRIVATE PARTNERSHIPS 

Today both governments and corporations increasingly recognize that women are key 

drivers of economic growth and social progress. In Latin America, for example, 

women's economic participation became a bulwark during the financial crisis of the late 

2000s. Extreme poverty throughout the region would have been 30% higher by 2010 had 

it not been for women's contributions to the labor force in the previous decade. Some of 

the biggest and most farsighted companies in the world are recognizing that partnering 

with women brings a multitude of benefits both for society and for the companies 

themselves. One of the outgrowths of this awareness has been the creation of publicprivate partnerships or cross-sectoral collaborations that support women entrepreneurs. 

The State Department and USAID have encouraged what has been called the "golden 

triangle"- government, the private sector and NGOs partnering to advance women's 
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economic empowerment. No one sector has a monopoly on the competencies that are 

required, nor on the resources, but together much can be achieved. 

During my time as Ambassador many such partnerships came to fruition, and rigorous 

evaluation and measurement of the results has since documented important strides for 

women's economic empowerment. Let me cite a few examples. 

Today there are many. 

5hy20: 

Coca Cola, with the strong support of its CEO who was at the forefront of partnering with 

women for growth, has utilized its corporate heft to better the lives of the world's poorest 

people, especially women. It created the 5by20 program to leverage its resources to reach 

and empower 5 million women entrepreneurs along its value chain by 2020, including 

fanners, shop owners and recyclers. It is designed to help women overcome three 

hurdles: the ditliculty in obtaining capital, lack of business training and inadequate 

networks of mentors and peers. The program partners with NGOs, governments and 

multinational organizations to achieve its goals. 

In Kenya and Uganda, to cite one example, Coca-Cola partnered witb the Bill and 

Melinda Gates Foundation and TechnoServe on Project Nurture, which reached over 

50,000 farmers--- a significant percentage were women. The farmers received skills 

training in fruit production, basic agricultural practices, farm management and business 

skills. They've also trained female farmers and their male peers, helping to increase 

women's representation in local farming groups and build their technical capacity. They 

linked women farmers with local banks to provide them with credit and with processors 

and exporters to expand their market. The women farmers saw their average incomes 

increase by 140% over a four -year period. Through Coca Cola's ongoing investment in 

fruit production in Kenya, two processors using produce from Project Nurture farmers 

now supply 100% of the fruit puree for Minute Maid in six countries. This is an example 

of a win-win for both the company and the economic empowerment of female farmers. 

Women's Economic Empowerment Initiative: 

In 2011, Walmart announced the Women's Economic Empowerment Initiative, one of 

the largest and most ambitious corporate women's initiatives to date. W almart sought to 

empower nearly a million women through diversity and inclusion, comprehensive 

training programs, as well as through sourcing from women-owned businesses. The 

company pledged at least $20 billion of spending on products and services from womenowned businesses in the US and committed to doubling its sourcing from women's 

businesses overseas. Walmart works with a range of partners from Care to WEConnect 

International, a non-profit with an expertise in bringing women-owned enterprises to 

global market standards. WEConnect identities and certifies such enterprises and 

provides training in critical areas like quality control and scaling up production. Walmart 

joined with the US government, the Inter-American Development Bank and several other 

companies and NGOs at the Summit of the Americas in 2012 to launch the Women's 
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Entrepreneurship Initiative to address major barriers to training, capital and markets for 

women throughout the Americas. 

FINANCIAL INCLUSION 

Financial institutions and technology companies have partnered to promote 

women's economic empowerment and to close the gender gap in access to mobile and 

internet. MasterCard, for example, is using mobile payment technology to promote 

financial inclusion. The company has a technological system that safely transmits 

information between merchants and banks. Governments are taking advantage of this 

technology. The MasterCard Center for Inclusive Growth is leveraging learning from 

hundreds of MasterCard's public-private partnerships to enable women's economic 

growth. For example, in South Africa, the government- in one year- registered more 

than twenty million citizens, opened bank accounts and distributed ten million debit 

cards, mostly to women. This digitizing of financial services allows them to access 

government and social subsidy programs safely without the worry that the funds, which 

had been coming in cash, would be taken away and used for things unrelated to caring for 

the family. MasterCard is also working to enable very small women owned businesses to 

grow. With 85% of transactions still being done in cash, they are combining women's 

ambition and know-how with the data and technology to transform economies and 

change lives. One of the biggest obstacles for women is their lack of credit history that 

lenders can use to evaluate their ability to repay. With the technology the company is 

developing, women business owners will be able to use their transaction histories as a 

proxy for credit that will make it easier for them to get loans. 

In another instance, the State Department and US AID came together with the GSMA, the 

mobile phone operators' association, and the Cherie Blair Foundation to reduce the 

gender gap in mobile technology. During the launch event an Indian micro-entrepreneur 

from the Self Employed Women's Association (SEWA) described how access to the 

simple cell phone had transformed her fledgling enterprise. 

The gender gap in access to and use of the Internet reflects existing inequalities between 

men and women. For countries, it means that a large portion of the population is missing 

out on the myriad benefits of connectivity. For individual women it means less access to 

entrepreneurship opportunities and, to important information, and less independence. 

Intel-commissioned research-- the first Women and the Web report-- estimates that 

doubling the number of women otherwise coming online over the next three years, would 

bring an additional 600 million women online, and contribute between $13-18 billion in 

annual GDP across 144 developing nations. One way Intel has been working to address 

the Internet gender gap is through a program called "She Will Connect" to train women 

and girls to be digitally literate, as well as to connect them to gender-specific online 

content. 

GROWING ECONOMIC INDEPENDENCE IN POST-CONFLICT SOCIETIES 
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Economic opportunity for women is vital to strengthening peace and stability especially 

in fragile states and post conflict societies. Developing sustainable employment entails a 

strong partnership between the private and public sectors and well as multilateral 

organizations. In Rwanda, Kate Spade & Company created an innovative business 

investment to enable women to be part of its supply chain and to interest other companies 

in sourcing from the Rwandan women's business as well. The company recruited ISO of 

the village ofMasoro's most talented and committed female artisans, helped them to 

develop their skills and set up their own worker-owned, for-profit business. This business 

investment is proving that it is possible to transform a relatively poor and marginalized 

community by growing women's economic participation. Georgetown University 

recently released a case study of the Kate Spade initiative. It found that it has already 

contributed to the empowerment of the women in Masoro who are t1ourishing 

economically and socially. The women have improved their spending on necessities and 

investing in the future. They are earning a decent and steady wage and receiving 

opportunities for training and development. On the business side, the Georgetown study 

found that Kate Spade & Company has created a financially viable business model for 

Rwanda. This investment was aided by support of the Rwandan government and also 

enabled by the Africa Growth Opportunity Act. It offers a model approach for creating 

sustainable economic opportunity in marginalized communities. 

Partnerships such as these are growing and making a difference by creating sustainable 

impact. The US government should continue to catalyze, support and participate in 

innovative partnerships among all stakeholders. Working together, we can better tackle 

the obstacles that stand in the way of women's economic progress. 

Mr. Chairman, thank you again for holding this hearing. Women's economic 

empowerment is clearly both the right thing to do and the smart thing to do. I know the 

work of this Committee will advance greater collective action. 
32

Chairman ROYCE. Thank you. I thank the panelists. And when 

we look at your testimony there are a lot of things that jump out 

that are really quite surprising. 

Dr. Suri, you mentioned your research on mobile phones in 

Kenya, I think. Again, what you just said was 186,000 women 

made the decision as a result of this new form of employment to 

move from subsistence farming to move into business or to move 

into sales. And yet maybe you didn’t see the same changes with 

men, but you saw this enormous shift. You know, I think this is 

key. But could you explain maybe a little more of why you think 

this occurred? 

Ms. SURI. Thank you, Chairman Royce. 

So that is exactly right, we did not see men shift occupational 

choice or switch their kind of decision of where their income is coming from, but women did. And that number is correct, 186,000. So 

we can’t pinpoint exactly why, but we can tell you kind of the two 

sort of leading hypothesizes, which are supported by the other work 

that was in my testimony. 

So one of them is that what M-PESA mobile money did was provide extra resilience. So you might have heard the term ‘‘high risk, 

high return.’’ Women weren’t taking advantage of high risk, high 

return because they were worried about the downside risk. They 

were worried that if something goes wrong, I still need to feed my 

kids, educate my kids. 

And so when mobile money came along and gave them this protection from the social network, they were able to take advantage 

of these high risks, high return opportunities like a business like 

sales. So I think that is part of the story. 

I think the other part of the story is it gives them control. A lot 

of these women actually do have cell phones and they are able to 

save on their phones through mobile money, and it gives them a 

sense of access and control to what is on their phone. 

And so I think both of those components probably explain these 

findings for women. 

Chairman ROYCE. So they exert ownership or they exert control——

Ms. SURI. Absolutely. 

Chairman ROYCE [continuing]. Over what is one’s property. 

Ms. SURI. Yes, absolutely. 

Chairman ROYCE. And that is something that men maybe already have, but now that women are empowered in that way they 

basically have a secure property right here, and that lets them assume greater risk, as you said, which is the driver of innovation, 

driver of economic growth. 

Ms. SURI. Yes. I like what you said when you opened. You said 

something about women controlling their future. I think this allows 

women to control a bit more of their future. 

Chairman ROYCE. Another question here, and I will ask the 

panel. Developing countries are increasingly coming to recognize 

the importance of women’s economic inclusion. So we see countries 

from Jordan to Kenya, as you pointed out, to Nicaragua, they have 

reformed their laws in recent years to improve women’s property 

rights. But this change takes time. 

33

And we have a Millennium Challenge Corporation here in our diplomacy that we use for leverage, and we have had some success 

in encouraging reforms in exchange for U.S. investment. And I 

would just ask the members of the panel here, how can we encourage more reforms and what should we be focusing on in that effort? 

Ambassador. 

Ambassador VERVEER. Well, I think that is an excellent question, 

Mr. Chairman. And it is true that without the kinds of reforms and 

legal protection women are not able to progress as they might in 

the economic sphere. 

I think what the MCC has done over a longer-term trajectory as 

it is organized to do, it certainly has a very strong gender component to its work and also is holding governments accountable using 

the leverage of America’s investment, as you say. 

I think the private sector too. Mobile companies, for example, 

who go in to ask for expansions of regulatory opportunities could 

also be raising issues about women’s legal protections or ways in 

which women can enhance their standing. 

So I think we need a combination of people who talk to governments, as each and every one of you does when you are on a codel, 

or when they are coming here, to raise these issues. 

You know, we talk about them as women’s issues, but they are 

far more than women’s issues. They peculiarly affect women, there 

is no doubt about it, but they have a great deal to say about all 

of society and certainly how economies function. So I think we 

should not diminish the aggregation of all of the ways to influence 

governments in making the right decisions. 

Chairman ROYCE. And I wanted to ask Ms. Iskenderian this 

question too. 

Ms. ISKENDERIAN. Thank you, Mr. Chairman. 

Just to build on Ambassador Verveer’s comments, it is a bit of 

a hackneyed phrase, but what gets measured gets done. And I 

think one thing that MCC in particular, but certainly any other 

agencies that are interacting with nations abroad and developing 

countries, can insist that tracking the data, tracking the number 

of women that are being served is done. 

Only 34 percent of cell phone companies today that are offering 

mobile money services even know the gender of their clients. So we 

can’t even really assess the nature, the full nature of the problem 

until we actually know who is being served, who is not being 

served, and how they may be different. 

We saw, both of the panelists referred to this, huge improvements in financial inclusion between 2011 and 2014 in the runup 

to the Global Findex report. The biggest changes were in those 

countries that had specific national financial inclusion strategies 

that had specific gender targets. That would be such an easy thing 

for us to include in anything that we require of a government that 

we are providing funding to. 

Chairman ROYCE. Very good. 

My time has expired. 

Mr. Engel. 

Mr. ENGEL. Thank you very much, Mr. Chairman. 

Ambassador Verveer, let me ask you this. Thank you again for 

coming here. I have two questions. 

34

While empowering women economically is certainly in line with 

America’s values, it is also in America’s U.S. national security and 

foreign policy interest because it promotes peace and stability in 

fragile states. You have done a lot of work in Georgetown and during your time at the State Department as the first U.S. Ambassador on global women’s issues on the link between women’s economic empowerment and national security. 

So I would ask you, in general, how does empowering women 

promote U.S. foreign policy, national security, and economic interests? And what role did empowering women economically have in 

Rwanda in terms of economic growth, but also post-conflict peace 

and stability? 

Ambassador VERVEER. Congressman Engel, I think the 

connectivity between women’s economic agency and participation 

and peace and security is one that is increasingly linked and one 

that we are recognizing as critically important. And I know that 

this panel had a previous hearing in this area of women, peace, 

and security, and what their agency represents. 

We know that in those societies where the condition of women 

is one where they are oppressed and denied their rights, those conditions often are the first signs of increased instability and potential conflict. I often feel as though women are the canaries in the 

mines. Look at what is happening to the women and you will have 

a sense of what is to come down the pike, if we have the vision and 

the ability to look at those conditions and take them seriously. 

I think one of the most important elements as we take hopefulness out of situations where countries are coming out of conflict is 

to appreciate that you could have the best peace agreement, but if 

the key issues that affect the people on the ground—and one of the 

critical ones is their economic future—are not weighed into those 

agreements and are not executed in a recovery process, you are not 

going to have that long-term sustainable peace that an agreement 

hopefully would guarantee. 

And in a place like Rwanda, for example, there was a recognition, and while so many lives were lost, that women had to play 

a critical role. Today they comprise some 60 percent of their Parliament, the highest women’s participation in legislatures in the 

world. They are active in ministries. They are active in every facet 

of the decisionmaking processes in Rwanda. And I think to some 

extent, whatever you think of President Kagame, he has recognized 

that the empowerment of women has played a major difference in 

moving his country forward. 

In my testimony I note one of the projects that I have been involved in included a private sector company, Kate Spade & Company, which made a business investment in Rwanda specifically for 

business results, but also to empower women. And what we have 

seen in the case studies that have been done on that investment 

is what a difference it is making, not only in terms of their business investment, but particularly in terms of women’s economic 

empowerment and social progress for those women and their community. 

So, again, the link between economic participation, economic viability, opportunity, and sustainable peace and the amelioration and 

the avoidance of conflict go absolutely hand in hand. 

35

Mr. ENGEL. Thank you. 

Let me ask Ms. Iskenderian this question. What steps do you believe the administration should take to promote the economic empowerment of women? How and why should they target women 

from poor rural communities just as equally as those living in 

urban centers that already have access to the formal economy or 

banking? And finally, what good does incentivizing legal and policy 

reform do for women from all socioeconomic backgrounds? 

Ms. ISKENDERIAN. That is a tall order. 

Mr. ENGEL. And you have 18 seconds. 

Ms. ISKENDERIAN. Thank you. 

I think just to make one clarifying point, that urban-rural divide 

that you mentioned. Yes, one of the very exciting things about mobile money is that we are able to reach rural populations that have 

been so excluded. 

But just because a woman is in an urban area doesn’t necessarily 

mean that she has access to financial services. In far too many 

places we still see the formal finance sector has, for example, very, 

very high minimum balance requirements. There is a very strong 

sentiment on the part of low-income men and women that the financial sector doesn’t really want them. But I think for women 

there is also this emotional distance, so to speak, that they really 

do not feel respected, their savings are not necessarily wanted. 

But those banks that do make that commitment, that do make 

that leap into this new market, find that women are really excellent clients. They tend to be the savers, their savings accounts are 

the stickier savers. They are more willing to buy cross sold products than men are. They buy more insurance than men do. Lots of 

very good benefits. 

And so I think to whatever extent this administration can continue to foster that support specifically from the private sector. As 

I mentioned in my remarks, I think there is a great deal we can 

do in derisking. We have seen a number of the development finance 

institutions from other developed countries are providing that kind 

of support, first-loss guarantees, that first step into a market that 

supports a private sector player. But then as they get used to that 

market, and they see that this is a good form of investment, that 

support can be lessened. 

Mr. ENGEL. Thank you. 

Mr. Chairman, before I go back, I would just ask for unanimous 

consent to enter CARE’s written testimony into the record. 

Chairman ROYCE. Without objection. 

[The information referred to follows:] 

******** COMMITTEE INSERT ********

Mr. ENGEL. Thank you, Mr. Chairman. 

Chairman ROYCE. We go now to Ileana Ros-Lehtinen of Florida. 

Ms. ROS-LEHTINEN. Thank you very much, Mr. Chairman, and 

thank you to the ranking member, for convening this important 

hearing. And thanks to our witnesses for excellent testimony. 

With so much going on around the world, the Syria conflict, the 

Iranian nuclear deal, North Korea’s ballistic missiles, and everything in between, lamentably we often overlook the plight of 

women in the developing world and our role and our responsibility 

for helping these women. We know that women in many developing 

36

countries oftentimes face insurmountable legal, cultural, and religious barriers to becoming the full and equal members of society 

that must be their natural right. 

Not only is this a travesty for the rights of women, but in many 

of these countries when women have the same rights and access as 

men, the transition from developing to developed countries becomes 

a reality. 

Preventing half of your population from access to the job market 

and thus the financial tools to help promote economic growth is 

just unconscionable. It is imperative that we discuss ways to correct this and that women in developing countries have access to the 

tools and the services so they can have an important role in their 

countries. 

We must also remember that it isn’t just the economy to which 

they are being denied access, it starts from the time that they are 

children. Oftentimes women are not even registered at birth, putting their future and their well-being in danger. 

That is why I have always been proud to support my good friend 

Steve Chabot in his efforts to pass the Girls Count Act—and thank 

you, Steve, for that—to ensure that these girls get birth certificates 

and are registered. 

My goodness, as a former Florida certified teacher, I know how 

important education is to all children, but for women in developing 

countries before we talk about getting them access to financial 

tools, we really need to ensure that they have access to a real education. That is why I have authored bills to provide Pakistani girls 

and women access to scholarships so they can get the education 

they require and why I am cosponsoring Steve’s Protecting Girls’ 

Access to Education Act. 

For women in developing countries we need to start changing the 

fundamental ways in which they are viewed from the moment they 

are born if we are ever going to have a chance at their access to 

the financial services later on, and that is a tall task because of the 

legal and cultural barriers they often face. Women in about 18 of 

the world’s economies, unfortunately, including many in the subcommittee that Mr. Deutch and I head, the Middle East and North 

Africa Subcommittee, require permission from their husbands or 

legal male guardians to work outside of the home, if they are even 

allowed to work at all. 

So I would ask the panel, how do you begin to make a change 

when so much discrimination is ingrained in the cultural norms 

and the societal norms and the values, when women from the time 

of birth are not viewed as equal to men? And how can we in the 

United States leverage our assistance and our role in the global 

stage effectively enough to promote the change that is needed? 

Thank you. 

Ambassador. 

Ambassador VERVEER. Well, Congresswoman, thank you for 

those remarks and for your leadership. 

It is not all a dismal story. There is certainly a long road to climb 

and a journey that women are on all over the world. But there has 

indeed been progress, and a lot of progress has come out of the 

leadership of our diplomatic and development efforts, as well as 

certainly those of others. 

37

And I think one of the key issues you mentioned is education. It 

is absolutely fundamental for a girl to be educated. Malala took a 

bullet just to make the case that girls have a right to an education. 

It is that megachange component, because we know all of the 

things that come out of an educated girl in terms of the benefits 

that take place over her lifetime, the children she raises, the kind 

of job she has. 

Ms. ROS-LEHTINEN. Thank you, Ambassador. 

Any of the other two? 

Thank you, Dr. Suri. 

Ms. SURI. Thank you, Congresswoman. 

I guess I would say I think there are two parts of this. Education, I completely agree. I think that is also tied to financial inclusion. We have some work in Kenya showing that when we gave 

households access to loans for these water tanks where you can 

store water, the girls went back to school. 

So understanding not just attitudes, but what is actually preventing the girls from going to school, what are they doing, and 

how do we try to alleviate those constraints can be important. 

I also want to mention some work on India which is fascinating, 

where they required some districts to have a third-of-women participation in local government. And they looked at the decisions 

then that the women made versus the men. And the women of 

course have different preferences than men. They chose different 

public goods and different investments than the men. Hard to 

weigh up which ones are better or worse. 

But what was really fascinating is they also did some surveys on 

the ground of people and they saw that people’s views of women 

started to change when women started to participate in local government and they saw women making decisions about what the 

community needed or not. So I think that is also something——

Ms. ROS-LEHTINEN. Thank you very much. I am sorry, we ran 

out of time. Next time. 

Thank you. Thank you, Chairman Royce, and thank you, Mr. 

Engel, for convening this important hearing. And thank you to Lois 

Frankel. I know that she was one of the engines behind this hearing. Thank you, sir. 

Chairman ROYCE. Thank you very much, Ileana. 

Albio Sires of New Jersey. 

Mr. SIRES. Thank you, Mr. Chairman, for holding this hearing. 

And I always have been very interested in this topic. I grew up in 

a household where machismo was it. My father would not allow my 

brother and I to hang around the kitchen. And I still remember the 

day when I was helping my mother make the bed where he picked 

me up and he spanked me because I was helping my mother. He 

always said that was the woman’s domain. 

But a funny thing happened along the way. At the age of 11, my 

parents and I and my brother, we came to America. My mother got 

a job first. All of a sudden, things changed in the house so completely. My father was in the kitchen helping her because she came 

in late. My father was helping out with the wash. And I always 

used to tell my father, I said, ‘‘Whatever happened to all those 

things that you taught me in Cuba that I shouldn’t do?’’ And I 

think he was kind of embarrassed for the way things changed. 

38

Then later on he got a job and all those things went down the 

tubes. 

I also remember my first day teaching. I taught in a school with 

a lot of Hispanic students and since I was bilingual I was the chaperone of the school dances. And the principal said, ‘‘You have to 

come.’’ And I used to hang around in a corner with about 12 mothers who used to come to the high school dances. 

I mean, it is fascinating. And, fortunately, I had two great college 

professors. I went to a Jesuit school in New Jersey which was only 

men, but when I got there it had changed. And I had the first 

woman professor ever and the second woman professor. They were 

fascinating and this topic was always brought up. 

But I cannot agree with you more that education and economic 

opportunity changes the whole formula. And I think that is what 

we should strive for when we want to help somebody. You know, 

there are a lot of things that we can do, but I think education is 

certainly our economic opportunity. Because I saw that my mother 

brought the first check and the whole thing changed, I mean overnight. And to this day I find the whole thing fascinating. 

So I guess what can we do to continue to provide economic opportunity for women, because I think that is the only way that you 

are going to be able to change it, and obviously education also, especially in the Western Hemisphere. I think that machismo is still 

pretty much alive in the Western Hemisphere in all these countries. My district is obviously a very predominant Hispanic district, 

I represent just about every country in the Western Hemisphere 

that speaks Spanish, and I hear these stories. 

And I am concerned with some of these cuts for these programs 

for women, you know, how we are going to impact that in the Western Hemisphere. Sorry to take so much time. But can you talk a 

little bit about it? 

We will start with you. 

Ms. ISKENDERIAN. Thank you, Congressman. And thank you for 

that story. It is absolutely what we see on the ground. As soon as 

the financial situation shifts a little bit, the dynamic in the household changes, a lot of other things can change as well. 

I think I just would like to build on some of what we were talking about with education, because what we see far too often is some 

of that really fantastic benefit that we all know about educating 

girls gets lost if we also don’t prepare them financially. So part of 

that education giving them financial literacy skills. 

And what we are seeing in our work on the ground, also getting 

a savings account, ideally in their own names, as early as possible. 

We have been working with an NGO in Africa that is graduating 

180,000, 200,000 young girls from secondary school every year, tremendous progress. But they are seeing those girls married within 

a year, because they don’t have savings, they don’t have life skills. 

They are not financially prepared to go out in the world. 

Mr. SIRES. I always figured that one of the issues that held my 

mother back was that my mother was 13 and my father was 23 

when they started going out. I always told my father you are going 

to be put in jail in America if you did that. 

Can you? 

Ms. SURI. Yes, thank you, Congressman. 

39

I guess I will just add on some of the stuff that was said earlier 

and something that Ms. Iskenderian talked about. If you look at 

the mobile money story, the technology and the innovation was 

seeded by aid money, by a donor. It allowed the private sector to 

kind of derisk what they were doing and provide a set of tools that 

affect women. 

I think thinking through how we provide that R&D capital for 

the private sector and emerging economies is really important, because they don’t have R&D, they don’t do R&D traditionally. But 

if we can derisk private sector investments in these countries I 

think we can get a whole set of new technologies and tools to 

women that I think will really benefit them. 

Mr. SIRES. I am sorry I ran out of time. Thank you, Mr. Chairman. 

Chairman ROYCE. Dana Rohrabacher of California. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. And 

again I want to point out that the leadership of Mr. Engel and Mr. 

Royce have again demonstrated that there are a lot of areas that 

we can work together on and that we are choosing issues like this 

that are just somewhat out of ordinary. And so I want to thank the 

leadership for this hearing today and making this issue. 

I would like some more specifics from you. You are the experts, 

and I want to know what countries are the good guys and what 

countries are the bad guys. And I guess, first of all, what countries 

would you say are on the super good guy list and what are the 

countries that are on the super bad guys list? 

Ambassador VERVEER. Well, I don’t know if I would call them the 

good guys and the bad guys necessarily. But there are plenty of 

rankings today, Congressman, and whether it is the UNDP’s 

human development rankings or the World Economic Forum’s gender gap rankings. 

Take the World Economic Forum. Nobody accuses them of being 

a women’s organization. And yet they annually look at the gender 

gap between men and women on four metrics in any given country: 

Health, access to education, economic participation, and political 

participation. 

Mr. ROHRABACHER. Okay. 

Ambassador VERVEER. And when you look at those rankings, the 

Scandinavian countries and others are at the top. And then keep 

going down and you find a lot of the countries that are in the most 

difficult straits today, conflict ridden, poverty stricken, capturing 

the headlines in not the most favorable way. They are the places 

where gender equality is clearly at the bottom. 

Mr. ROHRABACHER. Are there any poor countries—we are saying 

poor countries versus rich countries then—are there any poor countries that have a really good record on this? 

Ambassador VERVEER. That is a very good point, because if you 

look at the WEF’s rankings you will find some anomalies in there, 

countries perhaps in Latin America and Central America or in Africa, because they are looking at the gap based on what they have. 

And as they are closing the gap within the context of that country 

they are making progress. 

Mr. ROHRABACHER. Okay. Give me some specifics. 

40

Ambassador VERVEER. I don’t have the rankings in front of me, 

unfortunately. 

Mr. ROHRABACHER. There are some good guys at the lower end 

of the scale, a lot of bad guys. One of the reasons that their countries are poor is because they have oppressed women. And I think 

that it is very clear that if you oppress women you are oppressing 

one half of your population and thus you are cutting yourself off 

from a lot of economic activity. 

But do you have some names for me? 

Ambassador VERVEER. Well, you know, several years ago the 

Arab Development Report was published and it has been since updated. Arab intellectuals wrote that report. It had considerable impact in the region because one of the clear indices of why they were 

not progressing economically in ways that they should was the 

state of women’s conditions. 

Mr. ROHRABACHER. Sure. 

Ambassador VERVEER. Lack of education. 

Mr. ROHRABACHER. I understand. I am trying to get a little less 

philosophy out of you and some more specifics. 

Ambassador VERVEER. Well, I am talking about the region. 

Mr. ROHRABACHER. Okay. Give me some names of countries. Do 

we have any names of country? Give me a name of a couple bad 

guys we should have on our list and say, ‘‘Hey, why do you treat 

women that way in your country?’’

Ambassador VERVEER. Look at the situation in Pakistan, for example. 

Mr. ROHRABACHER. Okay, Pakistan. 

Ambassador VERVEER. Or the situation in Yemen. 

Mr. ROHRABACHER. Okay. 

Ambassador VERVEER. You know, these. And then look at the 

state of those countries. Certainly at the bottom in terms of equal 

opportunity and——

Mr. ROHRABACHER. Thank you, that is what I was really looking 

for, Pakistan and Yemen. Of course, let’s keep that in mind when 

we are dealing with those countries. 

By the way, let me just note women’s role in the military in various places. The Kurds and the Israelis seem to have women playing a major role in the security of their country. Are there countries, other countries like that, that we can—the United States has 

really increased the role of women in our military. Who are the 

good guys and bad guys in terms of utilizing women within their 

government and their military? 

Ambassador VERVEER. You have raised another critically important issue, the participation of women in the security sector. I 

think there are some seven or eight ministers of defense now in the 

European countries who are really moving this agenda forward. As 

you mentioned, we are making some progress. 

It is still a significant problem in U.N. peacekeepers, for example. There are very few women in the ranks of peacekeepers. Yet 

a major part of their mission is the protection of civilians, and it 

is often women who are in the most difficult straits in the places 

where they are keeping the peace. 

In military service and in police service, whether it is in Afghanistan or other places of conflict, to raise the participation of women. 

41

Mr. ROHRABACHER. Well, let’s just note—Mr. Chairman, thank 

you. And we note here that on Capitol Hill it was a female police 

officer that saved the lives of several Members of Congress who 

were under attack. 

Thank you very much, Mr. Chairman. 

Chairman ROYCE. Thank you, Mr. Rohrabacher. 

Ami Bera of California. 

Mr. BERA. Thank you, Mr. Chairman. 

I was listening to my colleague, Albio Sires, talk about his upbringing. When I think about my own upbringing in an immigrant 

household, both my parents worked, but my mom had multiple 

jobs, making sure me and my two older brothers got ready for 

school, making sure that we had something to eat, making sure 

that we did our homework, and the importance of empowering 

women to be kind of that glue. 

I would like to ask a couple questions. I think, Ms. Iskenderian, 

you talked a little bit about kind of going cashless. India is doing 

a pretty interesting experiment right now. And maybe it is not an 

experiment, it actually seems to be going fairly well. And I would 

be curious about the thoughts of going to this cashless economy 

and digital economy and the impact that has both bringing women, 

but bringing everyone into the traditional economy. 

Ms. ISKENDERIAN. Yes, it is truly remarkable, Congressman, 

what India has been able to accomplish, and the government has 

really just driven financial inclusion. They have, as I mentioned in 

my remarks, instituted this biometric system. So everybody has a 

thumb print, and that has been available to men and women alike. 

There are some things that we would love to see changed in this, 

because when the government is then looking at financial inclusion 

they are looking at household financial inclusion. And so we don’t 

always know, but when we dig into the data that typically means 

that the husband has taken that biometric information and opened 

the bank account rather than the wife. 

But not in all cases. And we are very excited about the opportunities. You probably heard recently about the demonetization. India 

took several currency notes out of the system. It was particularly 

difficult for women who still were operating in cash and didn’t necessarily have access to the technology for a variety of reasons, including cultural and social reasons. They didn’t own the cell phone. 

So we are eager to make sure that women are not left behind in 

this exciting move toward the cashless economy. 

Mr. BERA. Dr. Suri, did you want to add? 

Ms. SURI. Yes, I am happy to add, and thank you for that question. I will mention a couple of things on the digitization in India 

which, like Ms. Iskenderian said, has been impressive. When they 

started off I really didn’t think they would succeed at giving most 

of their population a digital identity. 

I think there is a bunch of research now showing great gains to 

this. One has been as they digitized people’s identity they digitized 

a bunch of the social welfare programs from the government. And 

this has dramatically reduced corruption in the government because you can’t have fake people anymore in the system and I can’t 

sign up Ms. Iskenderian and pay her on the side. So you see a reduction in corruption. 

42

And then, accompanying that, we have seen some luck where 

when women earn the money off the workfare programs, if it is tied 

to a bank account that they have that is theirs, it increases their 

labor force participation and their earnings. 

So I think it can’t be just digitization on its own because, as Ms. 

Iskenderian said, that doesn’t mean necessarily financial inclusion 

in the way we think about it for women and financial use. But 

when I can tie that digitization to now financial tools and other 

things, then you do see this benefit for women. 

Mr. BERA. Ambassador. 

Ambassador VERVEER. Thanks, Congressman. 

You know, one of the things that has always affected me traveling throughout the developing world is how terrified women are 

that the meager earnings that they may have will not be safely 

kept, because either it will be taken from them within their household or through bribes of one kind or another that they have to pay 

for essential needs. And this overriding concern is something that 

I think these changes that we are talking about this morning begin 

to really address in a serious way. 

And I think today you see more and more of the governments, 

as Dr. Suri said, taking their welfare payments, many of them targeted to the woman, for education and health and essential needs 

of her children, and, increasingly, that is coming in a card. It is 

digitized in a card. 

So the cash is gone. She can’t be targeted in the way she is used 

to being targeted and vulnerable. The corruption, as Dr. Suri said, 

begins to be addressed, and that is serious problem everywhere, as 

we know. And she goes with that card to get the essential items 

that she needs for her family. 

So this is revolutionizing that great fear that most poor women 

have in keeping their earnings safe. 

Mr. BERA. Great. Fantastic. 

I yield back. 

Chairman ROYCE. We go now to Joe Wilson of South Carolina. 

Mr. WILSON. Thank you, Mr. Chairman. 

And thank each you for being here today. This really has been 

fascinating to hear. The cell phone use in Kenya—how incredible, 

how positive. 

And, Dr. Suri, the House of Representatives, with the bipartisan 

leadership of Chairman Ed Royce and Ranking Member Eliot 

Engel, has a long history of promoting women’s economic empowerment in developing countries through various pieces of legislation, 

including funding for microenterprise development programs focused on women entrepreneurs and last Congress’ Global Food Security Act, which supported improved property rights and technical 

assistance for female farmers. 

In a time of limited resources, where should we be focusing our 

efforts now? Where can we get the best return on our investment? 

Ms. SURI. Great. Thank you, Congressman, for that question. 

I think I would echo something Ms. Iskenderian said earlier and 

something I have said already. One is measurement. Measurement, 

measurement, measurement. We are still figuring out what works 

effectively and what works best, and I think trying to encourage 

measurement. 

43

You know, we talked about property rights and how people have 

changed laws around property rights. Changing laws isn’t enough 

because it might not actually be implemented, right? And so understanding whether those laws have actually trickled down to changing women’s rights for inheritance is important. I don’t think we 

have an answer to that. 

So I would say measurement is really important. Evaluation. Understanding what works and then investing in the things that work 

is really important. 

And this ties back to what I was saying earlier. There is not a 

lot of R&D capital-type stuff in these countries. And so trying to 

be the provider of sort of the risk investment and the measurement, kind of let’s figure out what works and then invest in that, 

allows us to kind of use that capital very effectively, and then the 

private sector can build on sort of the things we are finding. 

So that is where I would see it. 

Mr. WILSON. And we would look forward to, each of you, on any 

legislation that we pass, for your advice on what we can do better. 

A side issue is that I have seen other organizations, like the 

International Association of Credit Unions. I was present in, of all 

places, Novosibirsk in Siberia, and it was so encouraging to me to 

see the establishment of credit unions where microloans were made 

to women to sell cosmetics door to door. At that time, in the late 

1990s, that was utterly revolutionary in post-Soviet Russian Federation. So, over and over, so much can be done. 

And, Ms. Iskenderian, widespread lack of official identification in 

developing countries disproportionately affects women and girls, 

without which it is hard for them to obtain even basic services such 

as a bank account. This committee has passed legislation, the Girls 

Count Act, to promote birth registration for girls in developing 

countries. But for these women who do not have a birth certificate 

or other official identification, what are some of the new technologies that are helping them to gain access to important financial 

tools? 

Ms. ISKENDERIAN. Thank you, Mr. Congressman. And thank you 

very much to the committee for having supported that legislation. 

The lack of a birth certificate just stops a woman’s progress right 

out of the gate, literally. So as we were referring earlier, the biometric identification tool is very, very exciting. 

And we are excited that there is going to be sort of further southsouth cooperation. India is now sort of going on the road with their 

technology. We do quite a bit of work in Nigeria where they have 

a similar technology. But where India has literally a palm-sized 

piece of technology that they can take out into the field and get the 

fingerprint. In Nigeria the machine is like the size of this table. So 

getting the technology right even with that great idea is absolutely 

critical. 

As I also mentioned in my remarks, something that is really not 

a technology, but something as simple as reducing Know Your Customer requirements for somebody to open a bank account with a 

cell phone photo, basic identification. 

In Nigeria there is a 150-page questionnaire that you have to fill 

out regardless of what you are trying to do with that bank account. 

When they instituted Know Your Customer requirements that were 

44

tiered to open simple savings accounts, you not only saw financial 

inclusion dramatically increase, but you saw the banks, the private 

sector banks, going in. It was now affordable for them to serve 

these customers because they didn’t have those heavy documentary 

requirements. 

Mr. WILSON. And thank you for highlighting where it is working 

and also suggesting changes where certainly technology could be 

better. 

Thank you. And my time is up. And, again, thank you so much 

for all of you being here today. 

Chairman ROYCE. Lois Frankel of Florida. 

Ms. FRANKEL. Thank you, Mr. Royce and Mr. Engel, for this 

hearing today. Terrific. 

Thank you to all of you. And thank you for all your work. 

I am going to assume that you all agree that the President needs 

to fill this position of Ambassador of Global Women’s Issues as soon 

as possible. That is something you all agree on. Yes. Okay. Yes, you 

are all shaking your head yes. 

And Representative Torres asked me to associate herself with 

some of these remarks I am going to make and some of these questions. 

Thank you for your talking about trying to connect women to 

technology and to cell phones. But I think you would all agree that 

a cell phone is not a replacement for an IUD or birth control pill, 

access to healthcare. It can help, I guess, get you the money, right? 

A couple points that I would like you to touch on here are for 

women to be productive, they cannot just be reproductive, correct? 

Yet, we have seen this administration expanding the global gag 

rule, zeroing out funding for family planning, cutting off funding 

for the U.N. Population Fund. 

And, listen, I am not just talking about abortion, okay? That is 

controversial. Let’s just talk about someone being able to plan their 

families. I would like you to touch on the impact of women not having full access to healthcare and being able to plan her own family, 

how that affects them economically. 

And the second thing I would like you to touch on is, we have 

heard some talk about a new World Bank fund. We are giving $50 

million to it. I would like you to relate that to your—a woman’s 

fund, yes. I would like you to relate, if you can, that to your discussion. 

Ambassador VERVEER. Well, thank you, Congresswoman. 

I couldn’t say it better in terms of the critical nature of how 

these investments in women are interrelated. Think of any American woman. If she doesn’t have access to family planning, for example, if she voluntarily wants access to family planning to be able 

to conduct her life, take care of her children, give them the best 

that she can provide, and succeed in her work, then she is constrained. She is severely constrained. 

A poor woman’s problem is that much greater. I have been in so 

many settings where women—one woman I remember vividly, five 

girls, five boys. She said to me, ‘‘This is too many children. I can’t 

take care of them. I don’t know what is going to happen to them. 

We have nothing.’’

45

It is so significantly entwined with their futures, with their economic viability, with how they take care of their families. You can’t 

work if you are sick. You can’t work if you are so constrained. So 

that goes without saying, as far as I am concerned. 

In terms of the women’s entrepreneurship initiative that Ivanka 

Trump has been associated with and that is part of this World 

Bank partnership, I think it is a good thing. It provides loan guarantees which we have seen work significantly. Ms. Iskenderian has 

talked about ameliorating risks, for example. Banks will not make 

these loans to women, small businesses, or medium-size businesses 

unless, frequently, there is a guarantee that they won’t lose everything on that loan. 

And this is supposed to, with the Bank’s work, involve training 

as well as other aspects of financial support and related supports. 

And there have been commitments from other governments as well. 

But the point is, that is a good initiative, but if in isolation we 

cut everything else, then what has it achieved? And I think that 

is what we have to keep in mind. We can’t just do one thing and 

expect magical results. We need to understand the complete person 

in these cases, what she represents, what she represents for her 

country, what is in our vital interests, and make decisions accordingly. 

Ms. FRANKEL. Thank you. 

Ms. ROS-LEHTINEN [presiding]. Thank you, Ms. Frankel. Thank 

you. 

We will now turn to Mr. McCaul of Texas, the chairman of the 

Homeland Security Committee. 

Mr. MCCAUL. Thank you, Madam Chair. 

And thank you for being here today, all three. 

I remember several years ago reading a book called ‘‘Inside the 

Kingdom: My Life in Saudi Arabia,’’ written by Carmen Bin Ladin. 

She is a European woman who married into quite a family that everybody knows about today. But she talked about 1979 particularly 

and how life was in the kingdom before the Ayatollah came into 

power in Iran and changed the entire region and then how life was 

after that event in 1979. And we all know it changed Iran, but it 

also fundamentally changed the Arabian Peninsula and Saudi Arabia, really rolling back time as it pertained to women. 

And, of course, the dress came back with the burqas and women 

were no longer able to drive in the kingdom and were not able to 

go outside, only at certain times, couldn’t go into certain premises. 

Just highly restricted, very oppressive society. And it is very sad 

to think the direction it was going before 1979 and where it is 

today after 1979. I have had the opportunity to visit, as many 

Members have, Saudi Arabia and I have seen that oppression. It 

is very dark. I have seen that firsthand. 

I have seen that same oppression in Afghanistan, just a little different color of burqa. It is more of a beautiful blue color. Pakistan, 

as you mentioned. Yemen. And it is a change in their laws, but 

more, I think, a change in their culture. 

And I guess my question, and it is a very basic one, is how do 

we change that? How do we change that fundamental culture so we 

can lift that oppressiveness off of these women? 

Ambassador. 

46

Ambassador VERVEER. Well, it is a very good question, Congressman, and I think it is a critically important question. Because we 

know that you need heat at the top. You have to change laws. You 

have to respect human rights. But you need heat at the bottom. 

And that comes from the people and their mindsets. And the 

mindsets, whether it is the Wahhabists and what they are perpetrating or whether it is customs saying this is how it is, it puts 

women down and really in many ways affects their human rights 

deeply. 

But there are a number of examples today where these norms—

culture can change. But you have to work at it. And you do need 

heat at the top and you need heat at the bottom. 

And, for example, this issue of female genital mutilation, FGM, 

it is a horrific custom that many go through, many women go 

through, because it is about their future. If they don’t, their future 

is inhibited in significant ways. 

But where there have been efforts, and they are documented, and 

there are successes every day. For the community to come together 

and understand what this does in terms of harming the health of 

the woman, potentially meaning maternal death in terms of childbirth, the consequences are huge. 

It takes village fathers, it takes imams, it takes the men, and the 

community coming together, and in place after place norms have 

changed. The norm went from FGM to the health of the woman. 

It takes time, but we have to work at it. And education is a critical 

element in all of that. 

Mr. MCCAUL. And I know the young Saudi crown prince who will 

be the king one day has a more progressive point of view with respect to this and with respect to the role of women in his society, 

and hopefully that will provide a change as well. 

Are there any other examples of a fundamental change in some 

of these countries that has made a difference in the lives of 

women? Perhaps the other two witnesses. 

Ms. ISKENDERIAN. Thank you very much for the question, Congressman. 

I would just refer to some work that we are doing in Pakistan 

currently with a mobile company, mobile cell phone company that 

is offering financial services. And we went in, actually, as a group 

of Western women, feeling pretty unambitious or we didn’t think 

we would be able to really achieve very much. 

But the company was seeing real change in youth dynamics and 

the generational dynamics, that, yes, it was difficult for unmarried 

girls to have access to cell phones, fathers really were not comfortable with their girls having cell phones, but since so many of 

the husbands of slightly older women had grown up with phones 

and they wanted their wives to have that access, we saw a real 

change and a real opportunity for——

Ms. ROS-LEHTINEN. Thank you so much. 

Thank you, Mr. McCaul. 

Mr. MCCAUL. Thank you. And sometimes I have to ban cell 

phones from my teenage daughters every now and then. 

Ms. ROS-LEHTINEN. And now we are pleased to turn to Congresswoman Tulsi Gabbard of Hawaii. 

47

Ms. GABBARD. Thank you very much. Thank you for the important work that you are doing and for being here to really add to 

this important discussion today. 

I would like to touch on a couple of things with regard to the use 

of mobile money and M-PESA in Kenya, but how it is shown to be 

less effective in other countries. I think recently M-PESA was shut 

down in Albania, affecting nearly 250,000 users. 

So if you can talk about what are some of the barriers that still 

exist, and how you recommend public-private partnerships to break 

through this. Why does it work in places like Kenya and not in 

places like Albania? 

Ms. SURI. Sure. Thank you for that question, Congresswoman. 

So I will say a couple of things. One is that we are now seeing 

results out of Bangladesh that find the same sort of financial resilience effects we were finding, which is brand new work out of Bangladesh. Similar results in Tanzania. And we are replicating in 

Uganda. So in a few months I will be able to tell you the results 

for Uganda. 

You know, I think one key component of mobile money and why 

it has worked in Kenya is actually the business model. They knew 

when they did this pilot that was funded by the British aid organization that people wanted to use this technology to send money 

across distances, right? The people who invented this thought it 

was for microloans: Oh, this will be a way for people to pay off 

loans. 

Turns out very few people have microloans in Kenya, and they 

didn’t want it for that. They wanted it to send money 200 kilometers because there was no way to do that. And so they rebranded the product, number one. 

And, number two, they realized, like, I can’t just have my cash 

in, cash out points be in the city. If I have them only in the city, 

no one is ever going to use it. I need cash in, cash out points everywhere. 

So the private company invested in this network of agents to 

cash in, cash out, that when they started was already four or five 

times the size of the banking infrastructure. Today it is 130 times. 

A cash-out agent is about half a kilometer, you know, 5, 10 minute 

walk for almost every Kenyan, for the average Kenyan. 

So that business model of needing to be everywhere rather than 

in the cities was really, really key to this being successful. A lot 

of people who have copied it don’t think through the business 

model. They think through the technology and say, oh, I can copy 

that technology, but they think, oh, I am a banker, I am going to 

start in the capital city and see how it goes before going anywhere. 

But if you do that, you are going to restrict the entire purpose of 

the technology. 

And so I think people haven’t quite picked up on the business 

model is one, and how crucial that business model is to the success 

of what the technology is meant to do. And I think the U.K. aid 

pilot allowed them to realize that what we were thinking is wrong 

and we need to do something completely different. So that is one 

aspect. 

48

I think the other is kind of investing heavily in the platform that 

develops this technology. So talking about the risk investment is, 

I think, important here too. 

So those are the two, I think, big success cases. And there are 

countries that are not allowing it regulation-wise. You know, they 

are worried it is sort of outside the formal banking system and 

what does this imply. And so I think there have been some agencies trying to take the Kenya example and regulators from Kenya 

around to talk to people to try and get them to understand what 

are the right sorts of regulations you need to have in place to avoid 

money laundering and to avoid the risks that you traditionally 

think of in the banking system. 

Ms. GABBARD. And my next question was about collateral. I 

think a couple of you have mentioned that as one of the barriers 

for women, in particular, that has to be overcome with regards to 

property rights and other things. So if you could expand a little bit 

about how that barrier is being overcome. 

Ms. ISKENDERIAN. Again, thank you very much for the question. 

As I mentioned in my remarks, we are very excited about this 

growing trend of movable collateral registries that we are seeing. 

Fifteen countries in Africa alone are going to have movable collateral registries coming online in the next 2 to 3 years. 

In China, when they implemented a movable collateral registry, 

they allowed accounts receivable, things that we take for granted 

in our banking system, to be used as security against a loan, we 

saw a massive increase in SME lending, two-thirds of which was 

to women. So being able to have access to other forms of security 

is really critical. 

We are also seeing some exciting fintech solutions where we are 

providing alternative credit scoring. The ability to track behavior, 

track payments, track interactions, transactions, digitally is allowing us to have algorithms that do track to creditworthiness. 

Ms. SURI. I will just add one bit. I think the other way to fix 

some of this is to provide loans that are for assets. 

Ms. GABBARD. Right. 

Ms. SURI. So some of the work we did in Kenya, we gave loans 

for a water tank. And some people like to have cash. And, like, no, 

no, it is for the asset, and the asset is the collateral. And that allows them to get a loan for an asset, and then you can 

recollateralize that asset once it is paid off. 

Ms. GABBARD. That is great. 

Ms. SURI. And so I think that is another way to do it, is to say 

let’s do mortgage-style lending. It is not a mortgage because that 

is a big amount. But even for a $200 asset, let’s structure it where 

the asset is collateral. 

Ms. GABBARD. Great. 

Ms. SURI. And that allows you to then keep that collateral once 

it is paid off and recollateralize. 

Ms. GABBARD. Thank you so much. 

Ms. ROS-LEHTINEN. Thank you, Ms. Gabbard. 

We turn to Congressman Scott Perry of Pennsylvania. 

Mr. PERRY. Thank you, Madam Chair. 

Thank you, ladies, for being here. 

49

I am fascinated to a certain extent, Dr. Suri, by your story in 

Kenya. I have two daughters. And I haven’t been to Kenya. I have 

read, of course, and I can only imagine the culture, right, and how 

if the woman, even though she might have the money, if she has 

it physically, where the man might take it and control it, et cetera. 

So in the greater context, though, we are going to spend about $35 billion on foreign aid this year, right, the United States taxpayers are going to spend that. And I have this study from the 

GAO regarding how the different agencies are doing, how they 

spend their money, and the efficacy of the goals. It is pretty sad. 

For instance, DoD, of the high quality, generally met all applicable criteria, zero. Zero. Now in that context, it is DoD, right? I 

would contend that this should not be DoD’s mission, right? But, 

apparently, people contend it is, and we have sent money to them 

and they get pretty poor results. But even at the State Department, they are up to a whopping 4 percent. USAID does a little 

better at 26. Millennium Challenge Corporation, believe it or not, 

44 percent. 

So I guess my question is—and one of you, I don’t know if it was 

Ms. Iskenderian or Dr. Suri, said if you measure it, that is the key. 

Well, somebody is measuring it here, but I don’t know that we are 

making the changes that we need to based on the measurements. 

So for each of you, your top three policy recommendations for us 

policymakers to make a difference so that so we change this zero 

to something meaningful. And if it means DoD doesn’t spend any 

of this money and it is sent to the Millennium Challenge Corporation, so be it. 

But you are the alleged—you are here because of your expertise, 

right? So we are looking for some answers from you on how to do 

the job better than we are doing, which is apparently abysmal, if 

you look at the GAO study. So anybody care to venture? 

Ambassador VERVEER. Well, I will start. 

I think, given this hearing, one of the critical things in government that doesn’t happen is to look at the gender influence, if you 

will, integrating gender into these issues. 

A lot of these issues aren’t women’s issues. Take farming, agriculture productivity. We know that women farmers, for example, 

often are the backbone of their economies, where there are ag 

economies, and often comprise the majority of the small-hold farmers. Yet, when we have ag policies, do we integrate that consideration in terms of what women need as opposed to male farmers? 

Those are often different needs for productivity. If we did bring 

those issues to the table, into our consideration, we would have 

dramatically different results. 

And with food policy and food security issues, it is critically important to do that. And we have seen from the studies that have 

been done that where this is a major consideration, you have outcomes that are different. 

Mr. PERRY. Okay. That is fair. 

Ambassador VERVEER. Another one is——

Mr. PERRY. I want to be quick. 

Ambassador VERVEER [continuing]. Measuring and evaluation. 

And it is data. We talk about data. It is the cat’s meow. It is something we should all be doing. But we are not willing to pay for data 

50

collection. And I think that is a very big issue in a lot of the grants 

that are made and in decisions. 

Mr. PERRY. Okay. What else you got? 

Ambassador VERVEER. Another one is looking at the evidencebased case, what is working and what is not working, and quit repeating the mistakes, and scale what is scalable. 

Mr. PERRY. So just in that point, we are going to need some help 

from outside organizations because, for instance, I have to tell you 

that when you go to cut some of the money going to DoD for these 

programs, can you imagine the panoply of names that we are all 

going to be called around here if we say one cent less for X? That 

is where we need your help, to point out, look, this is not effective, 

it is nothing personal, but let’s spend the money here. We will do 

the same mission, but somebody else does a better job. 

Yes, ma’am. 

Ms. SURI. So I would say three things. R&D, we do not do 

enough about learning what works, and testing and experimenting. 

You know, the Poverty Action Lab that I am affiliated with at MIT 

is doing this with policy. Let’s go experiment and see what works. 

Think of the title of this hearing, microfinance. We thought this 

was the silver bullet for women. Turns out, it doesn’t do that at all. 

Mr. PERRY. Right. 

Ms. SURI. We have now seven studies. 

So I think really doing what R&D would do, which doesn’t exist 

in developing countries, not just measure, but evaluate, test, experiment. 

I think working with the private sector. The private sector in developing countries is showing an ability to scale in a way that others don’t have. Mobile money is scaling across the developing world 

faster than most things. And so seeding kind of innovation in the 

private sector, I think, can get you lots of gains. 

Mr. PERRY. I am sorry. My time has expired. I am happy to talk 

to you afterward. Thank you. 

Ms. ROS-LEHTINEN. Thank you so much. Thank you. 

Now we are pleased to turn to Robin Kelly of Illinois. 

Ms. KELLY. Thank you, Madam Chair. And I want to thank the 

chairman and ranking member for holding this hearing on empowering women in the developing world. 

This is a multifaceted issue that is particularly important to me. 

That is why Congressman Chabot and I introduced H.R. 2408, the 

Protecting Girls’ Access to Education in Vulnerable Settings Act. 

Giving women and girls access to quality education not only increases their economic potential, but it is directly related to conflict 

prevention and reducing gender gaps. 

Already, one in five girls in developing countries who enroll in 

primary schools never finish. And I am concerned this Trump 

budget, unfortunately, will drive more women and girls out of 

school as a result of very concerning cuts to foreign aid. 

USAID found that when 10 percent more girls go to school, a 

country’s GDP increases on average by 3 percent. Education provides a multiplier effect. When women and girls are more educated, 

they have greater decisionmaking power in their households, are 

less likely to be recruited by extremists, and have healthier and 

better educated children. 

51

Before I ask my question, I will say, someone asked who were 

the good guys and the bad guys. And as the past chief of staff to 

the Illinois State treasurer and the current co-chair on the Caucus 

of Black Women and Girls, I do feel that the United States of 

America needs to look at itself too. It is not just in developing countries that there is work to do. We have a lot of work to do here. 

But can you suggest the best leverage, how can the U.S. best leverage foreign aid money into programs that help women become 

more financially secure so that people do feel comfortable with the 

money that we are spending and we are giving to these countries 

and programs? 

Ms. ISKENDERIAN. I would reiterate my fellow panelists’ focus on 

data, on monitoring and evaluation, and let’s stop making the same 

bad investments and really start scaling the ones that do work. 

The other thing I would really add, though, is, again, that focus 

on the private sector. One of the things the United States does do 

very well domestically is on procurement and requiring a diversity 

in procurement policies. We should be doing that more with both 

our own private sector that is working in developing countries and 

that are getting government funding to do that, as well as encouraging the private sector in those countries itself to diversify their 

procurement. Having those women-owned businesses that we have 

been talking about in the supply chains of those companies can 

make an enormous difference and they have tremendous difficulty 

accessing finance. 

And then I am just a very big fan of OPIC. And it is a program 

that gives back to the U.S. Treasury rather than only taking. And 

there is no gender mandate that is explicitly in the OPIC program. 

And I think there could be, again, a lot of private sector and a 

great deal of leverage there. 

Ms. KELLY. Anybody else? 

Ms. SURI. Yes. Ms. Iskenderian said it well. I would reiterate just 

evaluating and really truly understanding what works is very critical. And investing in that knowledge base will help everybody 

across the developing world. And so I think investing in the knowledge base of what works and what doesn’t work, which is so underinvested in in developing countries, is essential. 

And Ms. Iskenderian mentioned OPIC. I will say thinking a little 

more innovatively about how aid organizations can invest and work 

with the private sector is key. 

If you look at Norway, the government has a—it is hard to say 

this—the government has a private equity fund, Norfund, right, 

completely private equity, Silicon Valley style, does investments 

with returns. And they are playing around with what their role 

should be and how they should structure that role. And I think it 

is interesting to see how that will evolve over time and whether 

that is an interesting model. But I think thinking of innovative 

models of how to structure our interactions is important. 

Ambassador VERVEER. Well, just very quickly, we are all singing 

from the same hymnal. But I think in terms of the private sector, 

there is some really impactful, innovative work going on using supply chains and value chains, and government participating in some 

of these collaborations in ways that we have talked about and 

haven’t talked about, which I think is critically important. 

52

And then I would say incentives, incentives to change behavior. 

You talked, Congresswoman, about education. What does it take to 

keep that girl in school? How do you affect the families that often 

want to push them into a child marriage, say? So incentive policies 

that help us do what we are intending to do. 

Ms. KELLY. If I would say to you, can you think of a program 

right now that you would tell us we should not repeat, do you have 

programs in your mind? You don’t have to tell me. I just want to 

know. 

[Nonverbal response.] 

Ms. KELLY. Yes, you do. Okay. 

I yield back. 

Ms. ROS-LEHTINEN. Thank you so much, Ms. Kelly. 

And we turn to Mr. Donovan of New York. 

Mr. DONOVAN. Thank you, Madam Chairwoman. 

You have identified, outlined, and vividly described what the 

issues are. I appreciate that for someone who is trying to understand it. 

I have one question. It is actually in two parts. And I open it up 

to the panel. 

A lot of the things that you have identified as the problems are 

caused by countries in which we don’t create their laws and we 

don’t support their culture and how they treat women. 

What influence could the United States use, since we can’t 

change their laws—and I think some of my colleagues hit on this 

peripherally—what leverage could we use to encourage countries to 

change those laws besides appropriations? Our Appropriations 

Committee will do that. 

But what kind of policies, what kind of things could we do to influence some countries to change either their laws or their cultures 

on how they treat women? 

And the other thing, the other part of my question would be, 

what laws could we propose? What could this committee do in 

order to advance—I won’t even say advance—get up to speed of 

how the cultures treat the female populations of their countries? 

Part of my great interest in this is I have a 2-year-old daughter. 

So women’s interests have really—they have always been an interest of mine. And I don’t want to say, Madam Chairman, because 

I am interested in women. But it has always been a concern of 

mine, the equality of women’s rights in our country, but now that 

I am on Foreign Affairs and I am seeing the disparity in how 

women are treated in other parts of our world. 

I would just like your expertise in how, again, our country can 

influence or encourage or use our leverage to advance women’s 

rights elsewhere. And then what can this committee actually do? 

And I just leave it in any order to the panel as a whole. 

Ambassador VERVEER. Well, I will kick it off by saying one thing 

that has always impressed me is not the lecture from the West so 

much that makes the difference, but our ability to help raise up the 

voices within the country who want this kind of change—women 

who want family law reform who cannot only succeed at doing it 

when they come together, but actually help their sisters in other 

countries who are in the same kinds of cultures and wondering how 

do we get there. 

53

Mr. DONOVAN. As you said before, pressure from the bottom? 

Ambassador VERVEER. Well, bringing women together so that the 

best practices in one place can be understood and applied in ways 

that are appropriate to the other place, validating the efforts and 

enabling others to benefit from those best practices. 

Ms. SURI. Thank you for that question. It is a hard question. 

I guess I would just say that it is not just laws, because in a lot 

of these places you can set all the laws you want but whether they 

are actually adhered to is a different matter. 

And so I think, as Ambassador Verveer said, like thinking how 

we actually get the perception of women changed on the ground is 

kind of key, not just the laws. So as women start to participate 

more and more, it seems that the attitudes start to change. 

So the example I gave was from India where a regulation required women to be part of local government, very low-level local 

government, and it didn’t change expenditures, but it did change 

people’s perceptions that women were good decisionmakers. The 

men were more likely to think that. 

So I think kind of thinking through not just what laws, but how 

do you actually change things on the ground, that when the laws 

come in they actually will have impact, is probably important as 

well. 

Mr. DONOVAN. The Indian Government changed that law. We 

can’t control what laws the Indian Government passes. So I am trying to figure out how could we influence. 

Ambassador, I think your comments are pertinent to that. What 

leverage could we use? 

And then, again, if there is something that this committee could 

put forth. 

Ms. ISKENDERIAN. I would very much echo Ambassador Verveer’s 

use of best practice. The best learning is peer learning. And it is 

often very difficult for people to hear an American voice suggesting 

something, and hearing another woman, another company, another 

bank from a developing country talk about their experience. 

We have done some amazing work in Jordan in microinsurance 

that has benefitted women’s maternal health tremendously over 

the last 3 years. The insurance company we work with just came 

back from Egypt where they were spreading the gospel. Private 

company. It wasn’t a government program at all. Whereas in 

Egypt, the government had requested this private company to come 

and explain how they had gotten this product to work so successfully. And that is going to be so much more powerful than anything 

that we could say. 

You know, I would also just say we have a very loud or could 

have a very loud voice in international fora that I don’t think we 

always use. In the subject of financial inclusion at the G20, we are 

not advocating for any of these issues as a government. We are 

very focused on issues about antiterrorism financing, money laundering, all of which is very, very important. But we don’t even add 

this as an issue that we are standing with those other 19 countries 

and advocating for. 

Mr. DONOVAN. There might have been an opportunity missed 

there, yes. Thank you very much. 

I yield whatever little time I don’t have left back. 

54

Ms. ROS-LEHTINEN. Thank you very much, Mr. Donovan. 

And we now go to Congressman Chris Smith of New Jersey, 

chairman of the Subcommittee on Africa, Global Health, Global 

Human Rights, and International Organizations. 

Mr. SMITH. Thank you very much, Madam Chair. And I do want 

to thank Ed Royce and Eliot Engel for calling this important hearing. 

Ambassador, it is so great to see you again. And welcome to our 

other very distinguished witnesses. 

Just a couple of points because so much has already been said. 

And I got here very late to ask my questions. But I would like to 

comment on the shift. And maybe you might want to comment on 

it as well. 

I have written two laws on microcredit financing, targeting the 

poorest of the poor, reauthorizing the funding. But that has 

changed dramatically and radically, as you know better than anyone else. Where we used to rely on donor support, obviously, and 

you have all testified to this, USAID says that more than half of 

the financing provided by microfinancing institutions now comes 

from deposits, as you know so well, with much of the remaining 

from private capital. 

And, again, I think my good friend from Staten Island made a 

very good point. What can we do to accelerate that or to keep that 

trajectory so that more people are reached? 

CARE points out that women still lag behind men in access to 

financial services by 7 percent worldwide, 9 percent in developing 

countries. So that disparity and gap must be closed, I would note. 

And your points about cell phones were excellent. You all made 

very good points about that. When we were going and doing our 

part to try to resource the Ebola crisis, one of the biggest 

takeaways was how cell phones were the bridge between best practices, including what do you do if somebody passes? Don’t touch the 

body. That was all being sent out via cell phones. Radio was there. 

Cell phones were the dominant medium, if you will, that were used 

there. 

Financial inclusion, obviously that is extremely important as a 

driver. You might want to speak to that. 

And finally, today, in about 2 hours, the Frederick Douglass 

Trafficking Victims Prevention and Protection Reauthorization Act, 

a bill that I have introduced, joined by my good friend and colleague Karen Bass, Ileana Ros-Lehtinen, Chairman Royce, Ms. 

Frankel, and others, will be on the floor. 

And we have new language in this. Besides reauthorizing the 

TVPA of 2000, 2005, the International Megan’s Law, and the William Wilberforce Act, to the tune of $534 million over 4 years, it 

will do a number these best practices of training procurement officers, so that they know what to look for in trafficking. 

And you might speak in a parallel way, because I think poverty 

is still one of the major drivers behind trafficking, how we might 

also get procurement officers and others, because we buy an awful 

lot in this country, to be more aware of how they could be helpful 

in this important and noble battle as well. 

Ambassador. 

55

Ambassador VERVEER. Well, thank you, Congressman Smith. It 

is always good to see you. And thank you for your leadership on 

so many issues we mutually care about, whether it is son preference or human trafficking. 

On the trafficking piece, I think the supply chain is a really important issue, and it has been manifested in other ways. But the 

work that is being done to understand where slavery is injecting 

itself and what end products have utilized and tapped that in 

terms of undermining people’s human rights I think is a very important piece. 

And as you have so well stated, trafficking would not be the 

multibillion-dollar criminal industry it is today if people had economic viability. Traffickers prey on people who are desperate to 

come out of the straits that they are in, and they are coerced and 

conned, and we know what happens. 

So I think this is a very important piece. You have been on this 

issue a long time. This is another critical element as far as I understand. 

And, quickly, on the cell phones, we have talked a lot about the 

financial transaction side of it. But your point about Ebola is one 

point I don’t want us to miss, which is the critical information, 

health information, inventory information on product lines, how to 

move them, information for women to protect themselves from violence, a lot of that is happening through the cell phone today. That 

is why it has become such a critical tool, particularly for poor 

women. 

Mr. SMITH. Thank you. 

Ms. SURI. I will just add on the cell phones. I think Ambassador 

Verveer is absolutely right. There is lots of evidence that people are 

able to manage also their health lives better with cell phones. You 

can remind them to take medication that has to be taken continuously, and they do, and they respond to it. 

In all sorts of ways cell phones are such a big part of people’s 

lives in the developing world that they really weren’t here at the 

same sort of level of development in any way. 

And I think they are critical not just to that, but also we did a 

bunch of work on the Ebola crisis when it was happening in Sierra 

Leone and we wanted to track the economic effects it was having 

and whether women were pulling away from health services because they were worried about catching Ebola. And we did all of 

that data collection by cell phones, because we had been working 

in Sierra Leone for several years, we had people’s phone numbers. 

And we ended up being able to trace out, literally every month we 

were running a quick survey of a few thousand people in Sierra 

Leone to track what was happening and how they were responding. 

And so I think not just in terms of good for people, but in terms 

of also being able to understand crisis situations, they have been 

very useful. 

Mr. SMITH. Thank you so very much. 

Ms. ROS-LEHTINEN. Thank you so much. 

And now we turn to Ambassador Wagner of Missouri. 

Mrs. WAGNER. Thank you, Madam Chairman, for hosting such 

an excellent hearing. 

56

As a woman on both the Financial Services and the Foreign Affairs Committees, I am highly concerned about women’s economic 

empowerment. And I very much appreciate your testimonies. Far 

too many of the world’s women live in the cash economy without 

access to financial markets and services. 

Dr. Suri, I had a chance to read some of your work on financial 

services innovations that improve financial inclusion. I was particularly interested in your National Bureau of Economic Research 

paper published last fall which cited the importance of equipping 

commercial savings products with features that guide clients toward better financial planning, from text messages that remind 

people to save to automatic withdrawal of savings from paychecks. 

Tell me, how can the private sector, Dr. Suri, in developing countries improve how the poor are saving? 

Ms. SURI. Thank you for that question, Congresswoman. It is a 

great question. 

I think the private sector is starting to innovate a little around 

financial tools, but they are worried about risk. The financial systems are small, not that concrete, not that stable. And so I think 

they are worried about risk. So they do experiment a little, like 

with savings accounts, as you saw from our work. 

But I think encouraging them to provide a variety of products. 

I think what we have learned from microfinance is one hat doesn’t 

fit all. I don’t walk into the bank and there is one savings product 

and one credit product. There has to be a variety that meets different types of people’s needs. And so I think trying to encourage 

the private sector to innovate around the types of products is one. 

And then we have talked about this bit before, is kind of helping 

them deal with that risk a little. If they are really worried about 

risk, can we derisk some of the things they are doing so that they 

are less worried and can invest and innovate more? 

And then, I think also doing the research piece around what 

works and what doesn’t work. You know, that piece is really about, 

how do we think about what works in the financial tool set for people in developing countries? And I think we need that knowledge 

to be able to then go to the private sector and say, look, this didn’t 

work, don’t do it, the same way we were talking about earlier here. 

We can bring knowledge even to the private sector to show them 

what is working and what is not working. 

Mrs. WAGNER. Thank you. I appreciate that. 

Ms. Iskenderian, I appreciate your leadership at Women’s World 

Banking. I had the opportunity to look at your partnership to create Jordan’s first health microinsurance product to directly address 

hospitalization costs. I learned that many existing health microinsurance products in Jordan exclude pregnancy and prenatal care. 

Do you find that this is the case in many parts of the world? And 

how can policymakers encourage the launch of microinsurance 

products that better support pregnancy care? 

Ms. ISKENDERIAN. Thank you, Ambassador. 

That was not just a factor we see in Jordan, I am afraid, but in 

many countries. Insurance companies don’t want to insure a risk 

that they know is going to actually happen. When a woman gets 

pregnant, we know what the outcome of that is going to be. So we, 

unfortunately, have found in many cases that that is an exclusion. 

57

Part of the reason why this product has been so successful in 

Jordan, and we have now replicated it in six other countries, is 

that we do not exclude maternal care. We found that that is the 

one time in a woman’s life that she will prioritize her own health 

over her children’s or her spouse’s or other family member’s. And 

so it is both a good sales technique in the way that you can convince a woman to take on that insurance if she sees it meeting a 

need that she expresses. 

It was interesting, in Jordan, we even saw women who were sort 

of outside child-bearing age find that that organization, the organization offering the insurance, if they had identified that need and 

recognized that as something that should be insured——

Mrs. WAGNER. So do you see those markets opening up at all, 

Ms. Iskenderian, I mean, in terms of maternity and prenatal care, 

and more across the world you are seeing it happen? 

Ms. ISKENDERIAN. We are. Microinsurance is just still a drop in 

the bucket in terms of what is needed. Again, technology is really 

very helpful because we are bringing the cost of those very small 

policies down. But I think there is a recognition and there has been 

quite a bit of research, women do buy more insurance around the 

world than men. If you are going to appeal to women you have to 

meet their needs, and maternal healthcare is right at the top of 

that. 

Mrs. WAGNER. I think it is. And whatever we can do as a country 

and a society to make sure that we are encouraging policymakers 

to make that more readily available across the world I think is 

very, very important. 

I believe, Madam Chairman, that I have run out of time. 

I have a wonderful question for you, Ambassador Verveer, but I 

will have to submit it in writing. 

So I yield back. Oh, Mr. Chairman. I am sorry. 

Chairman ROYCE [presiding]. Thank you, Congresswoman. 

Well, let me thank former Ambassador Wagner, but also thank 

every member here of the panel for taking time out of your very 

busy schedules to come here today to testify on this subject, because I think this is going to be very helpful to the committee as 

we continue our work to try to accelerate economic growth in these 

societies and promote global health and stability by focusing on 

this issue, by focusing on ensuring that the women who serve as 

the backbone of stable societies are not left behind and have the 

tools necessary to further progress in this area. 

So thank you all very much for your work in this area and your 

testimony. 

Ambassador VERVEER. Thank you. 

Chairman ROYCE. And we stand adjourned. 

[Whereupon, at 12:04 p.m., the committee was adjourned.] 

(59)

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FULL COMMITTEE HEARING NOTICE 

COMMITTEE ON FOREIGN AFFAIRS 

US HOUSE OF REPRESENTATIVES 

WASHINGTON. DC 20515-6128 

Edward R. Royce (R-CA), Chairman 

July 12,2017 

TO: MEMBERS OF THE COMMITTEE ON FOREIGN AFFAIRS 

You arc respectfully requested to attend an OPEN hearing of the Committee on Foreign Affairs. to be held 

m Room 2172 of the Rayburn House Otl1ce Building (and available live on the Committee website at 

ht!b-:.Ji}2.~\\ .For~Afiill-rs.hous£.,.£;.~): 

DATE: 

TIME: 

SUBJECT: 

WITNESSES: 

Wednesday. July 12,2017 

10:00 a.m. 

Beyond Microfinance: Empowering Women in the De; eloping World 

Ms. Mary Ellen lskenderian 

President and Chief Executive Ofticer 

Women· s World Banking 

Ta"1eet Suri. Ph.D. 

Associate Professor of Applied Economics 

Sloan School of Management 

Massachusetts Institute of Technology 

The Honorable Mclannc V crvccr 

Executive Director 

Georgetown h1stitute for Women, Peace and Security 

Georgetown Un],.-crsity 

By Direction of the Chairman 

pk<l~r cal/20::'225-5021 <11 

nvm!ohilr(l' '!t"Commlftee 
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COMMITTEE ON FOREIGN AFFAIRS 

MINUTES OF FULL COMMITTEE HEARING 

Day Wednesday Date __ -'7,-'-'/"'12=-'I-='2-'-01"'-'-7 ___ Room ____ 2_1_72 ___ _ 

Starting Time _ ___c1,_,0"-:1=:2,__~Ending Time __ 1=:2,:"'-04_,__ 

Recesses 1 ... o·: I L__to ___J L__to __ )(___to ___J (___to __ ) (___to ___J L__to ___J 

Presiding Member(s) 

Chairman Edward R. Royce, Rep. Ileana Ros~Lehtinen 

Check all of the following that apply: 

Open Session [ZJ 

Executive (closed) Session D Televised [ZJ 

TITLE OF HEARING: 

Electronically Record!!.!JJtaped) [ZJ 

Stenographic Record lLJ 

Beyond Micro finance: Empowering Women in the Developing World 

COMMITTEE MEMBERS PRESENT: 

See attached. 

NON-COMMITTEE MEMBERS PRESENT: 

none 

HEARII'IG WITNESSES: Same as meeting notice attached'! Ves[2] NoD 

(If "no", please list below and include title, agency, department, or organization.) 

STATEMENTS FOR THE RECORD: (List any statements submitted for the record.) 

LFR -Rep. Eliot Engel 

SFR -Rep. Gerald Connolly 

TIME SCHEDULED TO RECONVENE____ Dr_ ~ I 

TIME ADJOURNED _1_2._·0_4 __ _ 

.Full CommTtteeHearlllgCOdinator 

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HOUSE COMMITTEE ON FOREIGN AFFAIRS 

FUU COMMTTTRF. HF.ARTNG 

MEMJJER PRESE"!T MEMBER 

Edward R Rovce_ CA X Eliot L. EngeL NY 

Christopher H. Smith, NJ Brad Sherman, CA 

Ileana Ros-Lehtinen, FL Grego!' W. Meeks_ NY 

Dana Rohrabacher, C A X Albio Sires, NJ 

Steve Chabot OH Gerald E. Connolly, VA 

Joe Wilson, SC X Theodore E Deutch_ FL 

Michael T. McCaul, TX X Karen Bass, CA 

Ted Poe_ TX William Keating_ MA 

Darrell lssa. CA David Cicilline, Rl 

Tom Marino_ PA X Ami Bera, CA 

Jefr Duncan_ SC X Lois FrankeL FL 

Mo Brooks. AL X Tulsi Gabbard. HI 

Paul Cook, CA Joaquin Castro, TX 

Scott Perrv, PA X Robin Kelly, TL 

Ron DeSantis_ FL Brendan Boyle_ P A 

Mark Meadows, NC Dina Titus, NV 

TedYoho.FL X Norma Torres_ CA 

Adam Kinzinger,TL X Brad Schneider, TL 

Lee Zeldin, NY Tom Suoai_ NY 

Dan Donovan, NY X Adriano EspaillaL NY 

James F. Sensenbrenner_ Jr .. WI Ted Lieu, CA 

Ann Wagner_ MO 

Brian J MasL FL 

Brian K. Fi!Lpatrick, PA 

Francis Rooney, FL 

Thomas A GarrelL Jr., VA 
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MATERIAL SUBMITTED FOR THE RECORD BY THE HONORABLE ELIOT L. ENGEL, A

REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK


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poorest and most marginalized women and girls in some of the poorest parts of the world. This has 

included empowering women to address some of the most pervasive barriers to their own 

economic and social advancement, such as gender-based violence, discriminatory social norms, 

and restrictions on access to resources and opportunities that would help women contribute to their 

societies. These include property and livestock, birth certificates, inheritance, mobility, family 

planning and child care, education, financial services, and other tools that promote skills and 

productivity. 

Women's economic empowerment is a process by which women improve their lives and the wellbeing of their families and communities by increasing their access to economic resources and their 

power to make decisions. Women's economic empowerment means having access to and control 

over economic resources, assets and opportunities, and creating long-tenn changes in social norms 

and economic structures that benefit women and men both. 

This process involves three key interrelated elements: 

1. Women have the capacity, confidence, and choice to identify, pursue, and achieve their 

own and collective economic aspirations; 

2. Women individually or collectively influence or make economic decisions; and 

3. Power-holders, structures, and fonnal and infonnal institutions enable and respect 

women's access to and control over economic resources and opportunities. 

At its heart, economic empowerment helps women live self-sufficient lives where they can 

use their skills to generate income for the benefit of themselves, their families, and their 

communities. 

But it is crucial to underscore that sustainable economic empowennent cannot be achieved without 

also addressing the social, cultural and policy constraints and barriers that marginalize women and 

girls, particularly those who are poor. Women's economic empowerment is both a reflection of 

and a catalyst for gender equality across income levels and communities. Achieving women's 

economic empowennent goals, for instance, cannot happen without addressing violence and 

discrimination women and girls commonly face, just as women becoming more economically 

empowered will also lead to their greater autonomy, agency, and capacity to combat discrimination 

and gender-based violence. This requires an integrated approach to income generation, education, 

financial inclusion, social norm change, and access to reproductive health services to address 

barriers to women's economic empowerment. Tt also requires an approach that looks beyond the 

traditional tools ofmicroloans and microcredit toward community-driven and community-owned 

approaches that treat women as financial decision makers rather than simply loan applicants or 

investment opportunities. 

Key Principles to Approaching Women's Economic Empowerment 

Initiatives that promote women's economic empowennent and gender equality should be viewed 

in tandem with several basic principles: 

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Leave No Woman Behind: Focus resources and attention on women at the economic 

base- poor, low-income, and marginalized women- to achieve lasting results. Many 

interventions have neglected women among the poorest of the poor, relying on "trickle 

down" interventions that begin with higher-income populations and exclusively for-profit 

models, with the theory that benefits to this group will eventually reach the bottom of the 

economic pyramid. However, this misses a critical opportunity to empower a broader base 

of the population and catalyze sustainable development for millions of women with the 

greatest need in the poorest segments of society. The massive gains in GDP that would be 

achieved if women participated equally in the economy supports the need to include poor 

women at the bottom of the economic pyramid in women's economic empowerment 

initiatives. 

Take a holistic approach and tackle root causes. There are a variety of factors that lead 

to the disempowerment of women, including discriminatory social norms, gender-based 

violence and harassment, and discriminatory laws and administrative structures. Issues 

such as child marriage, gender-based violence, early pregnancy, and lack of reproductive 

health services or alternative childcare options are genuine challenges to women obtaining 

the skills, experience, and opportunities they need to advance economically. For instance, 

globally, participation of women aged 15-39 in the labor force goes down by 10-15 

percentage points with each additional child they have. 1 Women's economic empowerment 

activities should create an enabling environment for women by integrating approaches that 

address these underlying barriers to both draw in women marginalized by discrimination 

and empower them to combat such discrimination against themselves and within their 

communities. In order to be truly gender transformative, approaches should engage 

women, the wider community, and especially men and boys, in redefining social roles and 

expectations, leading to broader women's empowennent, as well as direct participation in 

control of family income and assets. 

• Women's voice and participation at all levels is critical. Initiatives that include women 

in developing the objectives and design of economic empowerment engagement will have 

a better likelihood of incorporating the specific needs, aspirations, and capacities of the 

women served. Inclusion is also a powerful empowerment tool in itself as it engages 

women to think critically about their goals and available resources. Governments, 

businesses, and donors all have a role in ensuring that policy reform and programmatic 

investments in women involve them at the design, implementation, review, and 

accountability stages. 

• Access to reproductive health and family planning services is inextricable from 

women's economic empowerment and self-sufficiency. Helping women decide if, when, 

and how many children they would like to have affords them the ability to take advantage 

of educational opportunities or pursue paid employment if they so choose. Enabling 

adolescent girls in particular to prevent or delay pregnancies, ensures that women and girls 

are able to attain levels of education needed to participate and thrive in the formal and 

informal workforce. Around the world, over 200 million women who would like to time 

1 Grepin KA and Klugman J (2013). Investing in Women·s Reproductive Health: Closing the Deadlv 

Gapp Between What we Know and What We Do. Washington: World Bank (2015). 
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and space their pregnancies lack the tools to do so - investing in family planning and 

reproductive health services offers a powerful tool in helping empower women and girls to 

live up to their full potential. 

Pathways to Women's Economic Empowerment 

To effectively reach women's economic empowerment objectives, CARE and others in the 

international community have designed and tested approaches in both stable and crisis-affected 

markets. Amongst them, four pathways for successful women's economic empowerment have 

emerged: 

Financial Inclusion: Bringing women into the realm of financial inclusion, and increasing 

their control over assets is a recognized key driver to economically empowering women4 

Globally, only 24 percent of low-income populations have an account at a formal financial 

institution, and only 11 percent save at a financial institution 5 This further impacts women, 

who still lag behind men in access to formal financial services by seven percent worldwide and 

nine percent in developing countries 6 CARE's experience with partners- Barclays, Equity 

Bank, MasterCard Foundation, UNCDF, Visa, Gates Foundation, Mars, the Government of the 

United Kingdom, and many others- has proven that forming and training savings groups (more 

than 75% are women) and then linking them to formal financial services is an effective twostep strategy to enable poor and excluded women to benefit from formal financial inclusion. 

CARE's Village Savings and Loan Associations (VSLA) are designed to ensure women have 

equal and increased control over financial resources and access to savings and credit. In 

addition to building financial skills and capabilities these groups simultaneously increase 

women's voice and decision-making power within households. The methodology builds on a 

savings-led approach to financial inclusion; a foundation in saving is one of three interventions 

proven to accelerate the economic empowerment of women regardless of their context 7 

Saving groups are recognized as a vital entry point to formal financial services8 and there is 

high demand from groups to protect and grow their savings with fonnal financial institutions. 

Our evidence shows that, once linked to a bank, the average savings per member increases 

between 40% to 100% and the average profit per member doubles 9 Key to these outcomes is 

investing in financial literacy training. CARE's data shows trained groups who have linked to 

assets is one of seven driYers to \Vomen's Economic Empmvennent according 

on Women's Economic (2017). available at: 

nC .rn"'"'""'" Foundation. "Financial Inclusion." available at: 

i11 tps ://.Y£'" \\ .l1SC lla mbcrf'oun4mion&rn..2rriHmh:s;:/ n rmn~lrr.l.:J.uc l u ">iQJ.~. 6 Dem.irguc-Kunt, Asli eta!., The Global Findex Database 201~: Measuring Fimncial Inclusion around the World. 

World Bank Policy Research WorkingPaper7255 (201~). 

'United Nations Foundation: A roadmap for promoting ,,,omen's economic cmpO\\Crmcnt. available at: 

bJJJIL{~~IDLJY0flJ_gn~£Q.QmadQJD1.19rE/sites!defm;lt/files~:v\TEE Rondmap Report Fin:1l : ,J.?fit 8 As referenced in the UN High Level Panel on \Vomen's Economic EmpO\vennent first second report and toolkits. 

"Barclav's, CARE. Plan, State (2016). available at: 

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a bank have a significantly higher savings balance and lower dormancy rates than untrained 

groups. 10 

Entrepreneurship: Some of the key constraints to female entrepreneurship include lack of 

skills and knowledge, limited control over economic resources and earnings, lower 

productivity in sectors that women typically engage in, and lack of access to credit and 

financial services. Initiatives such as VSLAs help poor women address some of these 

constraints- for example, by providing access to basic financial services, and to business skills 

training. However, supporting women's ability to build sustainable, profitable and growing 

enterprises at scale with the potential to enter the fonnal economy, requires a more focused 

approach that targets the specific vulnerabilities women might face: 

Enhancing fundamental business skills and independence for female entrepreneurs by 

providing business training, technical skills, access to financial services and technical 

assistance; gaps in literacy and numeracy may also need to be addressed. 

Enhancing the social or relational environment for support to female entrepreneurs 

through facilitating peer networks, mentoring and women's collective organization (for 

example through VSLAs and cooperatives), and engaging men and boys. This will also 

enhance negotiating power and address some of the structural barriers. 

Addressing strnctnral barriers to female entrepreneurship through advocacy for policy 

and social changes. This requires working with men, local leaders, the private sector 

and other power-holders to address underlying causes of gender inequality. 

Dignified Work: As women encounter violence, harassment, discrimination, and unequal or 

harsh working conditions in both the formal and informal working sectors, a growing emphasis 

on dignified work is necessary to uphold their rights. However, irregular, unsafe, poorly 

remunerated or exploitative jobs do not empower women in the short term or long term. Rather, 

poor quality jobs can increase disempowerment and marginalization, particularly if women 

lose their support networks, for example through migration or trafficking, or if their work 

increases the risk of stigma or exploitation. One critical pathway to achieving respect for 

women's rights in the world of work is through promoting collectives to ensure women's 

voices are heard, that women have influence over working environments, and that they are able 

to support each other. 

Women in Valne Chains: Gaining self-employment or receiving a wage are regularly cited 

as key pathways out of poverty for women in developing countries. Although much of the rural 

economy in developing countries relies on women in their role as producers, their contribution 

is often unrecognized or "invisible." Even in countries where the bulk of agricultural 

production is done by women, many crops are erroneously identified as "male crops," such as 

cocoa in West Africa 11 In addition, globally, women carry out between three and six hours of 

10 CARE VSLAdata2016 11 \Vhile approximately 20% of formally recognised cocoa farmers in \Vest Africa are female, it is estimated that 

\Vomen and t,rirls contribute up to -t-5~) of labour input, mainly through tmpaid family labour 

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unpaid care work12 each day, which underpins the formal economy, but continues to be 

considered less important. Gender-based division of labor and other structural barriers like 

access to land13 make it more difficult for women to access business development services and 

training opportunities, and reduce their productivity and their capacity to benefit from their 

work. Approaches to empower women in value chains should have the overall aim of enabling 

women to increase their share of gains through promoting ownership of resources and assets, 

control over profits, and access to markets. 14 

Cross-cutting these pathways is the underlying necessity to develop and expand women's 

resilience. Women are instrumental in reducing disaster risks, saving to create financial buffers, 

and are key actors in responding to emergencies as heads of households, workers, and business 

women. Greater effort has to be made, however, to appropriately support women's economic 

empowerment before and during crises. This requires an integrated approach by development and 

humanitarian actors, and policies by governments and donors that support investment strategies 

for women across the disaster cycle. 

Promising Practices 

Programmatic practices that are showing signs of broadly impacting women's economic 

empowerment include approaches such as: 

Scaling up of savings-led approaches with linkages to financial inclusion and financial 

literacy for participants. Across 11 countries in Africa, Asia, and South America, CARE 

established 35,000 savings groups of 15-30 members each, equipped them with skills to 

save and manage their money, and then linked them to fonnal financial institutions. This 

was the first partnership of its kind between a global bank (Barclays) and international 

NGOs to link savings groups to the formal banking sector. The results showed an increase 

of spending on health, education, housing, food and businesses, and a rise in fonnal 

financial inclusion. Notably, this approach also led to a rise in perceptions of empowennent 

with 180,000 women and young people reporting an increase in feeling respected and able 

to influence community and household decisions. 

• Bringing financial services to rural areas to increase access to financial products 

promoting savings and credit. Smallholder farmers and micro-entrepreneurs in Honduras 

experienced a 488% increase in yellow maize productivity and almost 100% of participants 

adopted new technologies through a financial inclusion proj eel. Smallholder fanners and 

micro-entrepreneurs were linked to Cargill's supply chain and encouraged to join Rural 

12 OECD Development Center, "Unpaid Care Work: The Missing Link in the Analysis of Gender Gaps inLabom 

Outcomes" (201~). available at: http://www.oecd.orddev/development-gender/Unpaid care work.pdf 1

' In developing countries for which dma arc available. only bel ween I 0-20% or all land holders arc women. 

H Furthermore_ partnerships \Vith the private sector are critical to efforts to strengthen \Yomen's economic 

empmvennent For example, since 2016, CARE has partnered \Yith Mars Inc. to empmver \Vmnen smallholder cocoa 

fanners in Cote d'Ivoirc. Cote d'Ivoirc supplies the nmjority of Urc world's cocoa. and boUr CARE and Mars arc 

committed to improving the lives of the families \vho make up the cocoa value chain. By the end of 2019, 5,000 

\Vomen \Yill have joined Village Savings and Loan Associations in28 cocoa-farming communities in Cote d'lvoire, 

enabling them to invest in improving their cocoa yields, send their children to schooL and grmv and diversify their 

incomes. 

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Savings and Credit Unions (CRAC) - a regulated entity providing financial services in 

rural areas. From 2014-2016 the capacity of CRACs was strengthened and facilitated 

members' access to technical training, financial literacy and business skills. This resulted 

in increased productivity and output, a rise in new businesses, and a notable increase of 

women holding savings. 

• Developing Women's Skills in Male-Dominated Industries. The work of CARE and the 

Gates Foundation to strengthen dairy value chains in Bangladesh increased milk production 

of producers by approximately 600%, helping meet demand from growing urban markets 

and significantly growing women's incomes. Mobilizing women across seven districts in 

Northern Bangladesh to form producer groups and providing access to an informal savings 

and loans platform and training on modem dairy fanning practices resulted in an increase 

in milk production and incomes, tlrst-time access to tlnancial services, and shifting social 

nonns where new skills coupled with community gender awareness training enabled 

women to tal<e up traditional male roles in dairy production. 

Recommendations for Action 

Given the need for targeted investment in women's empowerment, both economically and socially, 

CARE recommends Congress follow the following approaches and principles as it develops or 

responds to a U.S. role in this movement: 

• Invest in savings-led approaches that link savings groups to financial institutions. 

This approach ensures access to tlnancial products and opportunities for poor and 

marginalized women to save, have access to and control over their resources, and grow 

their money- all at less risk than traditional credit-based micro-loan programs. 

Couple savings-led approaches with financial literacy and business training. This 

enables women to better understand methods of saving, managing, and investing their own 

funds, empowering them to effectively exercise agency over resources they earn. 

• Engage women in the design, implementation, and review of women's economic 

empowerment policies and programs. This ensures that initiatives account for the 

particular context, needs, and capacities of the women they are intended to serve. 

• Ensure that women's economic empowerment approaches integrate objectives to 

address barriers to such empowerment. This means critically examining the context -

social norms, legal structures, discriminatory regulations - that have worked thus far to 

restrict women's access to the tools they need to engage in economic activities. Supporting 

local women's organizations engaged in advocacy around legal and structural reform is 

critical to this effort 

Continue already-established strategies to combat gender-based violence and 

empower adolescent girls, particularly the U.S. Strategy to Prevent and Respond to 

Gender-Based Violence Globally and the U.S. Global Strategy to Empower 

Adolescent Girls. Each of these comprehensive policy documents address many of the 

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critical barriers women and girls face in their commumt1es that, amongst other 

consequences, impede effective economic empowerment. CARE calls on Congress to 

further support U.S. Government practice by launching the USAID Women's Economic 

Empowerment and Equality Framework that provides guidance on empowerment of 

women within economic growth activities. 

• Invest in the power of partnerships. Through coordinated global action it is possible to 

scale transformative VSLAs to reach the poorest unbanked women and link them to formal 

financial services. CARE recommends the creation of a global partnership of private 

sector, government and development sector actors for coordinated action to scale up 

VSLAs and link them to formal financial services to realize impacts. Formal financial 

services providers (FSPs) are increasingly realizing the business opportunity for banking 

savings groups. In order to reach the necessary scale, FSPs should offer low or no cost 

savings and credit products, offer a digital and field agent platfonn to overcome supply and 

demand side costs to serve, and work with development partners to design products tailored 

to group needs. Donors can fund the scale up of cost-effective systems that deliver highquality groups and support the coordination and cross-learning of a global partnership. 

Development partners can ensure women fully enjoy the benefits of access to financial 

services via financial literacy training and linkage, and work with the community to tackle 

restrictive gender attitudes. Governments and central banks can implement policies that 

support group registration with simpler Know Your Customer requirements, support and 

fund the scale up of group formation and linkage via their national financial inclusion 

strategies and ensure supportive bank balance sheet and liquidity measures. 15 

Conclusion 

CARE USA sincerely thanks Chainnan Royce, Ranking Member Engel, and the entire committee 

for your commitment to examining the variety of needs, approaches, and promising practices that 

have emerged from decades of working with women to achieve economic empowerment, 

sustainable development, and social justice. We thank you for the opportunity to share some of 

CARE's broad experience on women's economic empowerment and stand ready to work with 

Congress as it continues to advance the rights of women worldwide. 

15 CARE International Briefing Paper to the United Nations High Level Panel on \Vomen's Economic 

on FinanciaL (20 17), available at: 

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Statement for the Record 

Submitted by Mr. Connolly of Virginia 

In the United States, gender equality and women's empowerment are strongly held American 

values that are fundamental to our national identity and prosperity. Empowering women and girls 

around the world is not just the right thing to do, it is an economic and national security 

imperative. There is a strong connection between a nation's security and stability, and the status 

of its women and girls. A 2016 McKinsey Global Institute report found that achieving global 

gender parity in economic activity could add $28 trillion to global GDP by 2025. But there is no 

easy path to national prosperity when half of a country's population is subject to widespread 

economic, political, and social oppression. 

This hearing is the latest in a series of hearings focusing on women and girls abroad. We have 

examined issues facing women around the world in the context of technology, security, and 

education, and today we tum to financial inclusion. Women cannot achieve economic progress 

without addressing other barriers to economic participation, such as access to family planning. It 

is disingenuous to limit the scope of a hearing about empowering women to strictly financial 

issues, especia11y when the Trump Administration has dealt blow after blow against women's 

rights both at home and abroad. 

The Trump Administration has paid lip service to the importance of expanding opportunities for 

women and girls globally. However, the Administration's policies and actions belie those 

statements. Setting aside the personal attacks unleashed by President Trump himself, discussion 

of which is beneath the dignity of this body, his Administration has pursued policies that 

represent a unilateral retreat from America's traditional role as a forceful advocate for women's 

rights. 

The President's FY 2018 international affairs budget proposes a 32 percent cut to U.S. 

diplomacy and development programs. The President's request would reduce or eliminate every 

single program dedicated to empowering women and girls. Such a draconian budget hardly 

represents a commitment to "expanding opportunities for women and girls domestically across 

the globe," as Under Secretary of State for Political Affairs Tom Shannon said in March 2017. 

Historically, the United States has been the largest donor to family planning and reproductive 

health efforts worldwide. Left to his own devices, the President \vould zero out all funding for 

this critical global health priority Reproductive rights are essential to ensure the health of 

vvomen and families. When women do not have access to reproductive health services. they 

cannot stay in school or go to work. According to an analysis by the Kaiser Family Foundation, 

if the President's proposal were enacted, nearly 25 million women would lose access to 

contraception, unintended pregnancies would increase by more than 7.3 million, abortions would 

increase by more than 3.1 million, and there would be an additional 14,400 maternal deaths. 

Beyond eliminating funding for family planning and reproductive health etTorts, President 

Trump has reinstated and expanded the Mexico City Policy This policy, known to critics as the 

"Global Gag Rule," bars US global health ti.mding from any foreign nongovernmental 

organization that does not explicitly reject abortion as a method of family planning, even if such 
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activities are carried out using private funding Under past Republican administrations, this 

policy only applied to family planning funds, but President Trump has expanded its application 

to all global health assistance- a 15-fold increase. One USAID global health implementing 

partner estimates that the loss of its USAID-funded services over four years will result in 6.5 

million unintended pregnancies, 2.2 million abortions- many unsafe- and 21,700 maternal 

deaths. I am proud to be an original cosponsor of the Global Health, Empowerment and Rights 

Act (H.R. 671), which would prohibit the imposition of the global gag rule. 

Budgets have consequences, and this Administration's budget would categorically hann women 

and girls around the world. I look forward to hearing from our witnesses regarding what actions 

Congress can take to continue the United States' longstanding, bipartisan advocacy for the rights 

of women and girls worldwide. 

2