Nexus Between Women Empowerment and Financial Inclusion: Empirical Evidence from Developing Countries

Abstract

Women’s freedom to make social, political and economic choices for their wellbeing regarded as women empowerment. Women have fewer opportunities to participate in social, political, and economic spheres in general, and developing economies in particular. Reducing gender inequality is the 5th United Nations Sustainable Development Goal (SDG). The study focuses on the ways to empower women through financial inclusion. Panel data for 33 developing countries was collected for the years 2004-2020. For the women empowerment, Gender inequality index (GII) was used as dependent variable. Financial inclusion (FI) has three main indicators i.e., number of commercial banks branches (BCB), number of ATMs (ATM) and outstanding loans (LOANS) which are used in the study. As control variables this study employed labor force participation rate female (LFPRF) and Gross domestic product per capita (GDPPC). The model includes cross sectional dependence, heteroskedasticity and autocorrelation. Hence, the Driscoll and Kraay (DK) technique was used. Financial inclusion has a visible impact on women empowerment as adequately determined by this study. The study recommended the governments and policy makers to create favorable environment for women which empower them and advance financial inclusion for equitable and sustainable development.