In recent years, the exploration of Central Bank Digital Currencies (CBDCs) has garnered significant attention, with 94% of global central banks exploring or piloting these digital currencies, according to the Bank for International Settlements. Among the most prominent motivations cited for implementing CBDCs is financial inclusion—the idea that these digital currencies could expand access to financial services, particularly for underserved communities.
The Bahamian Sand Dollar, for example, positions itself as a solution to bring regulated payments and financial services to communities that are typically excluded from the traditional banking system. These ambitions echo a broader global trend, where nations are increasingly focusing on utilizing blockchain-based currencies to enable easier, more secure access to money and financial services for those left behind by conventional banking systems. But while these digital currencies are hailed as a tool for inclusivity, the question arises: are they really working for everyone, particularly women?
CBDCs: A Vision of Inclusivity for the Underserved
CBDCs are designed to provide a more accessible form of money, essentially digitizing the national currency and allowing for peer-to-peer transactions without the need for traditional banking intermediaries. For the unbanked and underbanked populations, particularly in developing regions, CBDCs offer a promising route to financial inclusion. With a significant number of individuals worldwide still lacking access to basic financial services—especially in rural and remote areas—CBDCs are seen as a potential game-changer. They could remove barriers to banking services like high transaction fees, geographic limitations, and a lack of credit history.
For instance, the Sand Dollar, which was launched by the Central Bank of the Bahamas, aims to provide all Bahamians with a digital wallet, thus enabling access to essential services like remittances, payments, and government transfers. This system is also cited as a way to enhance financial transparency and reduce fraud, which are often critical challenges in less-developed financial ecosystems.
As governments and central banks work to roll out these digital currencies, many are framing them as a way to make financial services more accessible, particularly for women, who often face additional challenges in accessing banking. In many parts of the world, women are disproportionately excluded from the formal financial system. Cultural and social barriers, along with legal constraints around property ownership and financial decision-making, make it harder for women to participate fully in the economy.
Trust Issues: The Roadblock for Women
While the promise of financial inclusion is enticing, the reality is that women, especially in emerging economies, are not yet fully convinced that CBDCs will work in their favor. Women’s financial inclusion is still a work in progress, and many still face barriers even in the digital realm.
In many societies, women have historically had limited access to technology and digital infrastructure. They may lack access to smartphones, reliable internet, or the digital literacy required to navigate digital currencies. Even in countries where women do have access to these tools, they may not have the confidence or trust in digital financial systems, particularly when these systems are new, untested, and largely unknown. With limited knowledge of how these currencies work, women may hesitate to adopt them, especially if they feel these systems aren’t designed with their needs or concerns in mind.
Moreover, the digital divide still persists, with women often being at a disadvantage in terms of access to the financial education and resources necessary to confidently use new financial technologies. The digital financial ecosystem, although growing, remains largely dominated by male-focused infrastructure and design, which doesn’t always address women’s unique financial needs or concerns.
The Need for Gender-Sensitive CBDC Implementation
For CBDCs to truly fulfill their potential as tools for financial inclusion, central banks and financial institutions must prioritize gender sensitivity in their design and implementation. Ensuring that digital currencies are accessible, secure, and trustworthy for women will require a concerted effort to break down both digital and societal barriers.
Governments must take proactive steps to promote digital literacy among women, especially in developing countries where technology adoption rates are lower among women than men. Additionally, efforts must be made to ensure that these digital currencies are not only technically accessible but also culturally appropriate. In many regions, women are responsible for managing household finances, and their financial needs differ from those of men, particularly in terms of savings, credit, and cash flow management. CBDCs must therefore be designed with these needs in mind, ensuring they empower women to take control of their finances.
Furthermore, financial institutions should prioritize transparency and education surrounding CBDCs, particularly in areas with high levels of mistrust toward new technologies. Women need to be assured that their digital transactions will be secure and their financial data protected. Clear, accessible information about the risks and benefits of CBDCs—along with robust consumer protection measures—will help build trust among women and encourage wider adoption.
A Double-Edged Sword: Economic Empowerment vs. Digital Dependency
While the potential for CBDCs to empower women in the financial sector is real, it’s important to consider the potential downsides as well. CBDCs could increase dependency on digital infrastructure, which may not be equally accessible to all women. For example, in areas where women have limited access to smartphones, internet connectivity, or technical support, relying on digital currencies could deepen existing inequalities.
Additionally, the introduction of CBDCs could lead to a further erosion of privacy. Women, particularly those in conservative or patriarchal societies, might fear that digital currencies will expose their financial activities to unwanted scrutiny from family members or the state. The shift from cash to digital forms of currency might also raise concerns about control and surveillance.
Looking Ahead: Ensuring Financial Empowerment for Women
If CBDCs are to truly fulfill their promise of financial inclusion, regulators and central banks must ensure that they address the unique barriers women face in accessing digital finance. This includes promoting gender-sensitive financial literacy programs, creating more inclusive and accessible digital platforms, and providing clear information about the benefits and risks of CBDCs.
The road to financial inclusion for women is still long, but with intentional efforts to design CBDCs that meet their needs, there is a real opportunity to foster greater economic empowerment for women. Financial inclusion should not merely be a matter of access but also one of trust, safety, and equality.
As more countries explore the integration of CBDCs, it’s crucial that women are not just considered as part of the conversation, but as active participants in shaping a more inclusive and secure financial future. Only by addressing these challenges head-on can we ensure that the promise of CBDCs becomes a reality that works for everyone—not just in theory, but in practice.
