Can the digital economy transform financial inclusion in rural communities? A gendered lens

Abstract

Rural communities in Africa face various challenges related to infrastructure, limited economic activities and poverty. The COVID-19 pandemic, which aggravated some of the rural areas’ socioeconomic conditions, has illuminated the vast divide in accessing digital platforms for social services and financial access. Rural communities’ socioeconomic burdens can be alleviated through participation in the digital economy; however, this is yet to be a reality for these communities. While financial digital technologies have helped with financial access elsewhere, the same cannot be said for Africa’s rural areas. This exclusion is because location plays a significant role in the availability of digital solutions; hence areas with limited infrastructure will not have access to products such as digital financing, which is supposed to reach those that are far from financial institutions. The study employed a systematic literature view to understand the extent of financial inclusion in Africa. Content and thematic analysis were used to analyse the data. The findings highlighted a myriad of challenges that affect the participation of the rural population in the digital economy, stemming from access to and stable supply of electricity, the poor or limited infrastructure required for accessing digital products and gender-related issues where women’s gendered roles limit them from harnessing digital products. The study revealed that there is a shortage of digital products to reach all that needs access to finance. This is due to infrastructural challenges that are making access difficult for digital products such as mobile money to reach rural communities. Therefore, policymakers must focus on digital transformation for rural areas and support the usage of financial digital technologies to build the rural digital economy. In this way they will be promoting digital inclusion and reducing digital inequalities.