There are millions of women in Asia involved in a wide range of economic activities from the home, making handicraft, assembling parts for international brand names and working in the fields. They work for a small income, and generally in difficult circumstances. Deliberate actions to integrate the informal economy into the formal economy will give this segment of society increased opportunities. In many countries, the success of various national and international socio-economic reform programs have resulted in women becoming an increasing part of the formal economy. Through the concerted efforts of women’s rights movements, economic policy intervention and gradual shifts in cultural norms, women today have more opportunities for education, careers and political representation. However, in many instances the increase in participation in the formal economy has not come with a commensurate level of sophistication in financial literacy. As a result, women continue to face special challenges in their endeavour to be active participants in the economic system. Challenges women in Asia face in financial literacy Let me now turn to discuss some of the challenges faced by women in Asia in their endeavour to become more financially literate and financially independent. Firstly, with the socio-economic environment in Asia changing rapidly, there is greater uncertainty and volatility which represents a challenge even for financial experts. The financial system has also become more complex, with new risks emerging. This increased sophistication thus makes it increasingly difficult for those who are less financially literate to make sound decisions.

Secondly, the advances in technology has led to a proliferation of financial products and services. There needs to be a greater understanding of the basic concepts and practices of banking, insurance and equity so as to know how to make choices from the wide range of financial products available, and to assess the respective risks, costs and returns. Also important is the basic principles of debt management, wealth management and personal budgeting to be able to understand the importance of long-term savings in funding future requirements. Financial literacy involves being able to identify and understand the opportunities for income generation, access to funding, and learning how to make the most of the range of financial products  2  BIS Review 64/2004  available. It also involves learning how to manage financial risks in an environment where the financial infrastructure may be under developed. This may relate to the laws and procedures in the country. Also important is the need to be able to recognize illegal schemes and other exploitative practices such as predatory lending. Thirdly, while women in Asia are being less stereotyped and given greater opportunities for entering into the economic mainstream, nonetheless the working conditions for women in many countries have tended to be less favourable. The exploitation of labour in the informal sector in some instances are particularly bad, not only for women, but also for children and minority groups. Women who are disadvantaged in this manner have found it difficult to escape from the trap of indebtedness.