Tailoring Islamic Banking Products For Women


--- First published on June 2014 in ISRA Space Magazine ----

Dr. Beebee Salma Sairally

Researcher, ISRA

How different are women’s needs in terms of financial services? In a survey by the Boston Consulting Group (2009) of more than 12,000 women from 21 countries, women wanted more in terms of financial products and services that will (i) assist them to efficiently and securely manage household finances on a daily basis; (ii) help them in their long term financial planning; (iii) help them in coping financially in the event of divorce, loss of a spouse or at times of financial difficulties; and (iv) offer them more in terms of financial education and advice.

Surely internet banking solves the first of the issues highlighted by the women: bill payment, remittances, online viewing and management of one’s finances can be easily and securely effected without physically visiting the bank nowadays, providing both women and men with enormous time savings. The initiative of Citibank’s Women & Co., for instance, also addresses the important aspect of financial education – through services like master-class seminars, audio and video conferences, newsletters, blog posts, and goal setting tools. The services aim at providing women with a sense of community as women share their stories on various aspects of life from starting/running/selling a business to buying/selling/refinancing a home to financial matters relating to marriage, divorce, parenting.

Another major conventional banking initiative with the professed goal of driving women’s wealth creation is the Global Banking Alliance for Women (GBAW). It was founded in 2000 by the International Finance Corporation (a member of the World Bank Group) in cooperation with certain global banks headquartered in developed countries as well as a number of banks in developing countries. Through its financial network, the GBAW provides female entrepreneurs with access to capital, markets, education and training.

Other conventional banks across the world are increasingly reaching out to women customers. Bank One in Mauritius offers the Emma savings account with features like preferential interest rates and discounts for consultation with gynecologist and for mammography. Standard Chartered Bank offers women-only branches in India and Pakistan for its interest-based financing. Raiffeisen bank in Austria has instilled an inviting lounge-like set up as its interior décor that includes a play area for children. It employs female staff to attend to women customers, taking extra time to explain products thoroughly and build long lasting relationships with their customers.

The Islamic Banking Experience with Women Products and Services

Islamic banks, like their conventional counterparts, have also been adopting a similar approach to enter this niche market, although the most prominent manifestation seems to be women-only branches or special counters dedicated for women customers. This phenomenon is most pronounced in societies with a long tradition of separating men and women in the public domain. Dubai Islamic Bank pioneered this trend. Its first dedicated Johara branch was established in Jumeirah, Dubai, in 2003. Separate branches for women are now a widespread phenomenon in the Middle East. They are also found in Pakistan. Meezan Islamic Bank has a dedicated banking section for ladies.

The distinguishing features of these women-dedicated services at Islamic banks are comparable to those of conventional banks:

  • Abu Dhabi Islamic Bank offers the Dana cancer takaful plan that covers medical expenses for breast cancer.
  • The Mahra debit card at Ajman Bank provides discounts at high-end retail outlets, restaurants and hotels and eligibility for health and fitness facilities at ladies clubs. 
  • Benefits associated with the Al Reem brand of Emirates Islamic Bank include discounts on safe deposit lockers and other bank products; and special travel packages.

The Ladies Lulu Service of the First Community Bank, an Islamic bank recently set up in Kenya, sets it apart in terms of its attention given to women. At its dedicated ladies lounges, the bank provides financing for businesswomen, Shari‘ah-compliant microfinance products to women groups (in partnership with Women Enterprise Fund, an initiative of the government of Kenya), and training and skill development programs for women.

Rationale for Women Banking

Undoubtedly, demographics is a major factor sparking financial institutions’ interest in targeting women. After all, women constitute half the world’s population. They also make up over 40 percent of the global labour force and more than half of the world’s university students. Most importantly, their growing participation in society has empowered women financially. Therefore, a rising number of female clients have been seeking banking services and investment opportunities over the years. Developing new banking products to conquer this growing market segment would represent a viable business imperative for banks.

Add-ons or Value-Added Services

The question posed is whether these specialized services are mere add-ons aimed at making women feel privileged? Or, do they really represent unique value-added services aimed at providing women with better access to financial services to improve their wellbeing? The practice in the Middle East certainly reflects the objective of providing women with a more comfortable banking experience, with a tangent for catering for high net worth women customers. In countries where women have traditionally been excluded from access to financing, initiatives from conventional banks such as the Grameen Bank (Bangladesh) and the First Women Bank (Pakistan) have developed to give preference to women in financing. The Islamic microcredit institutions in Bangladesh, on the other hand, target women entrepreneurs and their spouses equally, which may avoid frictions in family relations. While women would like to benefit from bank accounts which offer shopping discounts packages or certain health privileges, so do men. The thesis of addressing women-specific needs rather appears to be a new business development strategy of targeting specific customer segments, similar to the approach of targeting children or students. The women empowerment objective – mostly the focus of the conventional approach – is not necessarily reflected in the practice of Islamic banks.

Drawing lessons from the Global Banking Alliance for Women initiative, it is felt that Islamic banks should take the lead in providing innovative Shari‘ah compliant products and services that contribute to the overall welfare of women. Surely, no civilisation can rise and sustain development without the emancipation of women. Surah al-Tawbah (Qur’an, 9:71) puts women on an equal footing with men in the struggle for the cause of Islam. Based upon this, Sheikh Al-Qardawi states that women must work in that which they can do well, just as men must work, subject to certain rules and conditions. Therefore, the call is for Islamic banks to provide better economic opportunities for women to succeed – opportunities that will facilitate the contribution of women to the economic progress of society.  


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