By Shalya Gupta
In today’s rapidly evolving financial landscape, inclusivity and empowerment stand at the core of progressive credit policies. Women should be included as mandatory co-borrowers in every loan that is issued. Such a policy is not just a statement of gender inclusivity but a strategic move based on a comprehensive understanding and respect for the pivotal role women play in the economic dynamics of a family, especially in the context of Indian households.
Understanding the household economy
Women are undeniably the backbone of household economies, often acting as the primary decision-makers and financial controllers within the family for household expenses. Their innate ability to manage household finances, prioritise expenditures, and save for the future makes them indispensable in the borrowing process. By acknowledging their role, we not only empower them but also ensure a more balanced and responsible approach to financial decision-making.
The psychological impact
The inclusion of women as co-borrowers brings about a significant psychological shift in how loans are perceived and managed. It fosters a sense of joint responsibility and accountability, making the financial commitment more profound. Experience shows that when women are involved, there is a heightened sense of obligation towards repaying the loan, stemming from their intrinsic value system that prioritises family welfare and financial security.
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Promoting transparency and communication
One of the challenges in the traditional loan system, particularly among the economically weaker sections, is the lack of transparency and communication within the family about financial matters, outside of household expenses. This often leads to mismanagement and strain on the family’s financial health. By involving women, there’s a direct channel of transparent communication, enabling all members to be equally informed and involved in financial decisions, thereby reducing misunderstandings and fostering unity.
The strategic importance of inclusion
Incorporating women as co-borrowers is not just about achieving a gender balance in the financial domain; it’s about creating a sustainable and inclusive financial ecosystem. This approach ensures that financial literacy and understanding permeate through families, empowering them not just economically, but also elevating their societal status. It aligns with our vision of a financially inclusive society where every member, irrespective of gender, has a voice in economic decisions.
(The author is CEO, PHF Leasing Limited. Views are the author’s own and not necessarily those of financialexpress.com.)