Global Banking Trends & the Female Economy

The Value of Banking on Women

The GBA Master Class kicked off the 2017 Summit with a presentation on why financial services providers should be exploring the Women’s Market. Paul Jenkins from McKinsey & Company reviewed research showing that significant growth is not expected in the overall economy in the coming years, but as the Women’s Market has some catching up to do there is natural growth there on which financial services can capitalize. He shared results from the GBA’s Economics of Banking on Women report, which revealed that the Women’s Market is indeed a growth opportunity. Rebecca Ruf from the GBA then used the data to demonstrate that providing a holistic Women’s Market program can lead to an increase in female customers and profitable growth.

Key Points

    • Return on equity for banks has remained relatively constant year on year, and a substantial increase in growth is not expected. Therefore, the existing market financial services providers are targeting is not going to provide the growth they are seeking.
    • There is strong revenue potential in the Women’s Market. An analysis by the GBA and the Women’s Financial Inclusion Data Partnership, with McKinsey & Company, shows there is a US$24 billion revenue opportunity from unbanked women alone. This does not include SMEs or those who are under-banked.

Rebecca Ruf Westpac Case Study Master Class 2017 Summit

  • The GBA, together with McKinsey & Company, analyzed data from 23 banks across 18 countries, banking 22 million female customers. The research revealed this segment is both attractive and profitable.
    • The data showed that women’s total growth and deposit volume growth is greater than men’s.
    • Women are also loyal customers and strong borrowers.
    • Women are good savers, with the same revenue per customer as men but less cost of capital.
    • Women also have slightly more products per customer, and they are less risky – with fewer non-performing loans across all segments.
    • However, women currently represent a small share of banks’ portfolios.
  • The most successful Women’s Market propositions are holistic, including financial products but also non-financial services like access to information, education, networks and recognition.
  • Mature Women’s Market programs have a higher share of female customers, more credit to women and more deposits from women, with higher loyalty, higher products per customer and lower NPLs for women – proving that offering a holistic value proposition to women makes long-term business sense.

Paul Jenkins Westpac Case Study Master Class 2017 Summit

SPEAKERS

PAUL JENKINS
Senior Partner, McKinsey & Company
Presentation (members only)

REBECCA RUF
VP Programs, Global Banking Alliance for Women
Presentation (members only)

IN THEIR
WORDS:

If you want to grow, it’s easier to stand on something that’s naturally rising than fight something that’s flat.
— Paul Jenkins

A holistic value proposition provides women what they need and what they want.
— Rebecca Ruf

Banks are looking for growth opportunities. The Women’s Market is an attractive market opportunity and also delivers something positive for society.
— Paul Jenkins