UOB Indonesia observes that the investment trend favored by women is those with short-term and fixed income, such as retail bonds and savings sukuk.
Heaptalk, Jakarta — Women tend to be interested in investments that have short-term and fixed incomes. This trend was disclosed by UOB Indonesia‘s Head of Deposit and Wealth Management Vera Margaret in a literacy event entitled ‘Building Inclusive Economies’ in Jakarta (08/15).
Vera mentioned several examples of these investments, namely retail bonds, savings sukuk, retail sukuk, and retail savings bonds (SBR). “However, gradually female customers have started to enter long-term investments such as equity funds,” said Vera during the discussion in Jakarta (08/15).
In investing, Vera revealed that instinctively women are more careful than men as they tend to think of people like husbands, children, and parents, except themselves. Genuinely, women play an important role not only at the household level but also in the Indonesian economy. Most of them have the knowledge and capacity to consider securing funds for their families and investing them in productive instruments.
On the other hand, women face three challenges in economic activity, namely a low financial literacy index, limited access to and knowledge of digitalization, and low access to available financial services.
Therefore, support from various stakeholders, including the government, regulators, customers, and the community is needed in empowering women to become strong pillars of society. UOB is optimistic that empowering women according to their potential and abilities can contribute to better economic growth.
High literacy rate but low inclusion rate
According to data from the Financial Services Authority (OJK) in 2022, Indonesia’s average financial literacy rate reached 49.7%. In more detail, the financial literacy level of women was 50.3% in 2022, higher than men’s 49.1%. However, the level of financial inclusion for women (83.88%) was still lower than for men (86.28%).
Acting Head of OJK Public Communications Group Sekar Putih Djarot said that women’s financial literacy had increased from the previous year which was only 36.13%. This increase was partly driven by a financial education program by OJK that targeted women.
“Regarding inclusion, based on studies, in society, women’s access (to finance) is not yet open. If we talk about formal financial service institutions, for example, funding, it usually requires collateral assets. These collateral assets tend to be more owned by gentlemen. To access funding, it can be said that they are not yet bankable,” Sekar explained during the literacy activity in Jakarta (08/15).
Sekar added that women have a tendency to save for necessities ranging from basic needs, and emergency funds, to children’s education expenses. For this reason, women need to think about the appropriate investment products to support the financial plans they have designed.
“Women who are recently starting to invest will usually choose mutual fund instruments. The mutual funds chosen range from fixed income, mix, to stocks,” said Sekar.
Prioritizing learning the risk profiles, then returns
Meanwhile, an Economist at the Senior Institute for Development of Economics and Finance (INDEF) Aviliani said that women should know the risk profile they can face before investing. In addition, women must also prepare emergency funds before starting investments.
“When starting to invest, it is better to set aside money at the beginning and not the rest of the money needed. In addition, women must also have clear goals and calculations, for example, in the next five years, what needs will arise,” explained Aviliani in Jakarta (08/15).
According to her, in investing, women usually choose products whose returns can be reused or have a short term. Women are said to prefer low-risk investments. However, women are now also starting to move into other investments such as government bonds and deposits.
