Gender Smart Lending

Is there a business case for lending to women? The International Labor Organization (ILO) study shows that 60% of companies with gender initiatives increase profits and productivity. Also, Boards with 1/3 women & gender balanced are about 20% more likely to have improved business results. There are so many other studies supporting business case for women.After all, women represent half of the world’s population and influence about 80% of the world’s purchases.

Last week I attended (virtually) the ASEAN Women CEOs Summit held in Vietnam and was a panelist at the session on Gender Smart Investing ably moderated by UN Women Representative Elisa Saenz.  Since I’m a banker, the question on lending: What are your banks programs and policies to support gender sensitive solutions on credit and lending?

Frankly, gender-sensitive solutions on credit and lending or “gender smart lending” is very new in the Philippines. Special lending window to women is mainly in Microfinance which has 9 million borrowers of which 90-95% are women, P60-billion portfolio, 500 branches and 50,000 employees. Government bank Development Bank of the Philippines (DBP) has a lending window to women called ILAW established together with Business Women Council. Current portfolio is P2.1 billion to some 370 women and DBP SVP Paul Lazaro said past due ratio is negligible.

Philippine private commercial banks (which includes PNB, the 4th largest private commercial bank) are gender neutral in granting credit, using the 4 C’s of Credit: character, capital, capacity and collateral.   PNB’s portfolio show that more than 50% of credit card holders and small business loans are to women. More than 50% of the depositors are women too. A good number of the business loans are to women owned or women-led businesses.

Good example of gender smart lending is Menarco whose CEO is a young woman, Carmen Jimenez Ong. Carmen constructed Menarco building in the Global City, considered the healthiest building in South East Asia based on the impact on the health of its occupants.LEEDS and WELL certified. People, Planet and Profit. For the bank, financial returns, helping the environment /sustainability and closing the gender gap.

PNB has a policy of gender equality. While we have not been deliberate or intentional in “gender smart lending”, we have been doing it “intuitively”.  PNB is the first Philippine bank to be Economic Dividends for Gender Equality (EDGE) Certified. EDGE is the global business certification for gender equality in the workplace. And PNB was recently recognized by Asia Money as “Leader for Women” in 2020, having women as majority or 66% of the work force across all levels from rank and file to senior management.  PNB also has 4 women directors out of 15 directors or 27% women directors.

What is gender smart lending?  It is the deliberate and intentional integration of gender-based data into financial analysis to find additional opportunities and mitigate risks.  It could mean granting credit through a gender lens (eyeglasses) to the ff:

*Women-led or women owned businesses

*Businesses that sell products/services that have a disproportionate impact on women, such as products that focus on labor saving devices, services that relate to women’s health, or learning tools to improve skills and capabilities of women etc

*Businesses that support women in the supply chain, i.e.making an effort to source from women producers or distribute their products through women led companies

*Companies with workplace gender policies; refers to women in the staff and leadership in the company as well as HR policies and programs that support gender diversity throughout workplace culture. EDGE certified companies such as Ayala, Insular, Magsaysay, PNB etc.

Gender smart lending is relatively new.  What can we do?

Awareness and appreciation of its benefits is important and buy in of top management in business and industry organizations (Finex, MAP, ICD, Baiphil, etc) .

Collaborate with organizations like Women Biz Council headed by Mylene Abivaand PhilWEN headed by Boots Garcia etc that help other women businesses.

Support GO Negosyo headed by Presidential Adviser Joey Concepcion that help mentor SMES,majority of whom are women. They should know how to make their business bankable, start with basic of record keeping, separating personal from business funds, putting contracts in writing and making even simple business plans.

Encourage women led businesses by promoting their products. Patronize suppliers and /or service providers that purchase from women suppliers and/or practice gender policies. In the same way we ensure that service providers comply with SSS and regulatory requirements as part of good governance.

Regulatory support. Touched base with Bangko entral’s Deputy Governor Chuchi Fonacier of what she thinks of lending window to credit worthy woman businesses or gender smart lending.  “Personally, I like this idea” she said “and BSP will try to imbed the requirements in the area of sustainable banking”. Wow, what a wonderful encouragement!

Gender Smart Lending is like “killing many birds with one stone”. Smart lending decision may lead to good credit portfolio, financial returns, move us closer to financial inclusion (70% still unbanked),improved social and economic impact and reduce the gender gap. And, in some instances, address sustainability and climate change issues as in Emma Imperial’s solar homes.  We should not let opportunities pass us by.  Gender smart lending is lending smart.


Ms. Flor Tarriela is the chairman of Philippine National Bank. She is a former Undersecretary of Finance and the First Filipina Vice President of Citibank N.A.  She is a director of FINEX and FINEX Academy and TSPI, a Microfinance NGO.  She is a member of WomenBizPH and Filipina CEO Circle.


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