Financial Inclusion vs. Financial Resilience: What Ukrainian Women Refugees can Teach Us

What happens to the financial resilience of women when they are forcibly displaced from their homes in times of war or in response to climate change? And how can global leaders – from policymakers to financial services providers to humanitarian organizations – provide meaningful support to mitigate the effects of extreme disruption?

In September 2022, I represented Women's World Banking at the Clinton Global Initiative to make a public commitment to understanding the financial health and resilience of Ukrainian women refugees. Since then, we’ve interviewed hundreds of Ukrainian women to understand the realities and challenges of moving to a new country, the role of financial services in rebuilding their lives, and how these lessons can be applied to other forcibly displaced persons.

Decreased financial inclusion and resilience characterized a refugee’s first year

Preparing to leave was a task unique to Ukrainian women and their dependents, as working age men were unable to leave the country. Women from every region of Ukraine scraped together whatever cash they had available in their homes and went to nearby ATMs to withdraw their savings in hryvnia, the local currency.

In moments like these, the accessibility and reliability of their financial services should be a given. Ukrainian women – who had high levels of financial inclusion in their home country (81% had their own account; 68% had a debit or credit card), should have been able to flee their homes with just a debit card and passport.

Our survey of these forcibly displaced women in their first year found that financial services were not overwhelmingly helpful to Ukrainian refugees. But early responses indicated that collective global action – in the form of humanitarian aid, international banking regulations, account accessibility measures, and more – could move the needle on financial resilience.

Another important takeaway was the significant decrease in financial resilience reported by Ukrainian women refugees compared to a survey of Ukrainians just a year prior. In 2021, before the war, 58% of Ukrainian women said it would be either very difficult or somewhat difficult to come up with emergency funds equal to 1/20 Gross National Income (GNI) per capita in the next 30 days. In 2022 that number rose to 79% of Ukrainian women refugees surveyed.

A year later: Financial inclusion shows signs of improvement, but is it enough?

In a follow-up survey conducted a year later, we uncovered new insights that show where progress has been made and where it’s clear more work needs to be done:

• Employment becomes a primary source of income: Compared to one year ago, employment is now the primary source of income for 33% of women’s households. This is a dramatic increase from the previous year where only 0.02% of these households saw their primary source of income coming from employment. It’s worth noting that? receiving countries allowed Ukrainian women to obtain work permits, even while preventing refugees from other countries from doing the same. And had these women settled in different countries, they may have been barred from employment entirely.
• Increased usage of some financial services: Over the last year, we saw changes in how women use different payment methods. There was a notable rise in ATM card usage (from 48% to 82%) and credit card usage (from 3% to 18%). This could be attributed to financial institutions simplifying the account-opening process for Ukrainian refugees, aided by decisions like the European Banking Authority allowing banks to use alternative forms of identification or delay know-your-customer processes altogether for Ukrainian refugees.
• Decline in mobile payment usage: Despite being a crucial enabler of financial inclusion globally, mobile money saw a decrease in usage by Ukrainian women (32% to 3%). This finding warrants further investigation to determine reasons behind the shift. Do mobile payment providers need to build more customer trust? Do these women need to expand their digital financial capabilities?
• Persistent –and increased – usage of cash: While credit and ATM card usage increased, Ukrainian women refugees continued to rely primarily on cash with usage surging from 64% to 95% in the last year. After hearing stories in earlier interviews about the personal and financial risks of carrying large amounts of cash, the prevalent usage of? this less secure form of payment is surprising. This suggests that there is still a gap between the products and services that are accessible and those that Ukrainian women prefer or feel comfortable using.

Looking beyond Ukrainian refugees

The lessons gleaned from studying Ukrainian women refugees can be applied to other displaced populations, whether a group is forced to relocate because of political, cultural, or environmental reasons. In many ways, this population of Ukrainian refugees represents the “best-case scenario” – they are highly educated, highly-skilled as a workforce, and have significant experience with financial services.

When we see a population like this struggling with financial resilience, it underscores the needs of other displaced people in less visible contexts. People with lower education levels, livelihoods that are more likely to be impacted by climate change, and limited financial inclusion could face even greater challenges as refugees. The financial system has a responsibility to all displaced populations – including Ukrainian women – to provide services that are readily available, accessible, and useful in times of crisis.

Addressing financial resilience for refugee populations should start by replicating what has worked well for Ukrainian refugees – like expanding access to work permits or adapting identification requirements for opening bank accounts – but the work can’t stop there.

Policymakers and societal leaders must consider the constellation of needs connected to finances like childcare or adult dependent care, proximity to educational resources, and long-term secure housing. Our data showed that many Ukrainian women worry about affording basic necessities like food and housing (57%), or healthcare expenses (39%) – challenges that could be alleviated through government programs and humanitarian services focused on these needs.

Financial inclusion solutions should continue to be explored and expanded, but we also need to seek out opportunities for enhanced resilience in all areas of a woman’s life.