    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

         BEYOND MICROFINANCE: EMPOWERING WOMEN IN THE DEVELOPING WORLD

    =======================================================================

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON FOREIGN AFFAIRS
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 JULY 12, 2017

                                   __________

                               Serial No. 115-53

                                   __________

            Printed for the use of the Committee on Foreign Affairs

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    Available via the World Wide Web: http://www.foreignaffairs.house.gov/
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                          COMMITTEE ON FOREIGN AFFAIRS

                     EDWARD R. ROYCE, California, Chairman
    CHRISTOPHER H. SMITH, New Jersey     ELIOT L. ENGEL, New York
    ILEANA ROS-LEHTINEN, Florida         BRAD SHERMAN, California
    DANA ROHRABACHER, California         GREGORY W. MEEKS, New York
    STEVE CHABOT, Ohio                   ALBIO SIRES, New Jersey
    JOE WILSON, South Carolina           GERALD E. CONNOLLY, Virginia
    MICHAEL T. McCAUL, Texas             THEODORE E. DEUTCH, Florida
    TED POE, Texas                       KAREN BASS, California
    DARRELL E. ISSA, California          WILLIAM R. KEATING, Massachusetts
    TOM MARINO, Pennsylvania             DAVID N. CICILLINE, Rhode Island
    JEFF DUNCAN, South Carolina          AMI BERA, California
    MO BROOKS, Alabama                   LOIS FRANKEL, Florida
    PAUL COOK, California                TULSI GABBARD, Hawaii
    SCOTT PERRY, Pennsylvania            JOAQUIN CASTRO, Texas
    RON DeSANTIS, Florida                ROBIN L. KELLY, Illinois
    MARK MEADOWS, North Carolina         BRENDAN F. BOYLE, Pennsylvania
    TED S. YOHO, Florida                 DINA TITUS, Nevada
    ADAM KINZINGER, Illinois             NORMA J. TORRES, California
    LEE M. ZELDIN, New York              BRADLEY SCOTT SCHNEIDER, Illinois
    DANIEL M. DONOVAN, Jr., New York     THOMAS R. SUOZZI, New York
    F. JAMES SENSENBRENNER, Jr.,         ADRIANO ESPAILLAT, New York
        Wisconsin                        TED LIEU, California
    ANN WAGNER, Missouri
    BRIAN J. MAST, Florida
    FRANCIS ROONEY, Florida
    BRIAN K. FITZPATRICK, Pennsylvania
    THOMAS A. GARRETT, Jr., Virginia

         Amy Porter, Chief of Staff      Thomas Sheehy, Staff Director

                   Jason Steinbaum, Democratic Staff Director

                                C O N T E N T S

                                  ----------
                                                                       Page

                                   WITNESSES

    Ms. Mary Ellen Iskenderian, president and chief executive
      officer, Women's World Banking.................................     4
    Tavneet Suri, Ph.D., associate professor of applied economics,
      Sloan School of Management, Massachusetts Institute of
      Technology.....................................................     9
    The Honorable Melanne Verveer, executive director, Georgetown
      Institute for Women, Peace and Security, Georgetown University.    22

              LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

    Ms. Mary Ellen Iskenderian: Prepared statement...................     7
    Tavneet Suri, Ph.D.: Prepared statement..........................    11
    The Honorable Melanne Verveer: Prepared statement................    24

                                    APPENDIX

    Hearing notice...................................................    60
    Hearing minutes..................................................    61
    The Honorable Eliot L. Engel, a Representative in Congress from
      the State of New York: Material submitted for the record.......    63
    The Honorable Gerald E. Connolly, a Representative in Congress
      from the Commonwealth of Virginia: Prepared statement..........    71

         BEYOND MICROFINANCE: EMPOWERING WOMEN IN THE DEVELOPING WORLD

                                  ----------

                            WEDNESDAY, JULY 12, 2017

                           House of Representatives,

                         Committee on Foreign Affairs,

                                Washington, DC.

        The committee met, pursuant to notice, at 10:11 a.m., in
    room 2172, Rayburn House Office Building, Hon. Edward Royce
    (chairman of the committee) presiding.
        Chairman Royce. This hearing will come to order. If I could
    ask the members here to take their seats.
        This hearing is the fourth in our series of hearings to
    examine the challenges and opportunities facing women
    worldwide.
        Today we consider some of the barriers to economic
    empowerment that women face in developing countries and what
    that means for them, what it means for their families, and what
    it means for their communities.
        Now, all countries stand to benefit from women's increased
    economic participation. But the potential gains are
    particularly great across the developing world, due to the
    extent of the constraints that so many women face on their
    ability to own property, their ability to access financial
    services, or work outside the home. Consider that women in more
    than half the world's countries face limits on their ability to
    own or manage property, while women-led small to medium-size
    firms in developing countries face an estimated $285 billion
    credit gap.
        As renowned Peruvian economist Hernando de Soto explained
    when he testified before this committee, one of the primary
    sources of stagnant growth and unrest in developing economies
    is a lack of property rights, and the resulting exclusion of
    workers, including women, from the formal economy.
        These constraints directly harm women by preventing them
    from working, from saving, and from controlling their own
    future. But they also harm economic growth and they harm
    stability. In fact, a multitude of studies project huge gains
    of global GDP from increases in women's economic participation.
        Perhaps that is why, after de Soto helped reform the
    customary laws in his native Peru to make it easier for
    Peruvian women to work and to own property, women's formal
    labor force participation increased by 15 percent in that
    country. As a result, Peru became one of the fastest-growing
    economies in Latin America.
        We have reason to be optimistic that this type of success
    can be replicated. More developing nations are beginning to
    understand the importance of women's economic inclusion and are
    taking steps to reform their laws and to address inequities.
    The U.S. has a critical leadership role to play in continuing
    to promote such reforms. Our economic, humanitarian,
    conservation, and many other interests around the world are
    better served when women are empowered and when economies are
    growing.
        Fortunately, new technologies are making women's economic
    participation more possible than ever. In decades past,
    microfinance loans were championed to combat extreme poverty.
    But microfinance is not a cure-all for those living in poverty,
    particularly those women who face so many additional challenges
    to their economic empowerment.
        In recent years, however, an exciting array of financial
    technologies, like mobile money, have sprung up across the
    developing world. This presents tremendous opportunity for
    impoverished communities and women in particular.
        And so I look forward to hearing from our distinguished
    panel today about how the U.S. Government can batter help
    ensure women's inclusion in the rise of ``Microfinance 2.0.''
        And I now turn to our ranking member, Mr. Engel, for his
    remarks.
        Mr. Engel. Mr. Chairman, thank you for calling this
    hearing.
        To our witnesses, welcome to the Foreign Affairs Committee.
        Ambassador Verveer, I am especially grateful that you were
    able to join us. I know you had to rearrange some travel to be
    here. Your work as our country's first-ever Ambassador-at-Large
    for global women's issues made a lasting difference all over
    the world. And I hope that the administration sees the value of
    this position and appoints a new Ambassador soon, along with so
    many other positions at State awaiting nominees.
        And I want to thank Dr. Suri and Ms. Iskenderian. I hope I
    didn't butcher that. Thank you so much. We look forward to all
    of you testifying.
        We use the word ``empowerment'' a great deal when it comes
    to women's and girls' issues. And honestly, I think it is a bit
    of a misnomer. Women and girls are powerful and we know what
    happens when that power and potential are unleashed--
    communities thrive, local and global communities grow,
    societies prosper and become more inclusive and equitable. If
    women were full participants in the global economy, we would
    see an additional $12 trillion to $28 trillion in growth in
    global GDP by the year 2025.
        Certain innovations, such as microfinance and mobile
    banking, have driven progress in women's economic
    participation, but they aren't close to a silver bullet. A
    woman without a mobile phone cannot take advantage of these
    tools. A woman without a birth certificate might not even be
    able to open a bank account. And in too many places around the
    world much bigger roadblocks stand in the way of women
    exercising their full potential. Roadblocks caused by poverty
    or lack of opportunity or by legal barriers or cultural and
    societal norms that treat women as second-class citizens.
        So when it comes to promoting economic access and
    participation for women, I think we should focus on getting
    these obstacles out of the way and make it easier for women and
    girls around the world to put their power to work.
        Now, in my view, making economies more inclusive for women
    is simply the right thing to do. It is just wrong that women
    anywhere are denied access to the same economic opportunities
    as men. And that is true in the United States as well. We might
    not want to deal with it, we might not want to confront it, but
    it is true.
        But this is the Foreign Affairs Committee, so we also need
    to ask: Why is women's economic opportunity a foreign policy
    priority? Well, it is easy: All those benefits of women's full
    economic participation I mentioned earlier--stronger, more
    stable societies--are also in our national interest. We want to
    see economies thrive, governments become more responsive,
    countries become stronger partners on the global stage.
        Full participation of women is directly tied to these
    outcomes. So from a strategic standpoint, this is good, smart
    policy that strengthens American security.
        The aim of our policy then should be to identify and meet
    the challenges that hold women back from full economic
    participation. When we start to look at those challenges, we
    find that women's economic participation is closely tied to a
    range of other issues that disadvantage women and girls in the
    developing world.
        For example, a young girl who is denied an education won't
    become financially literate or learn the skills needed to
    compete in the marketplace. Girls forced into child marriage
    won't have a chance to contribute to their local economies.
    Women who are victims of gender-based violence and domestic
    abuse are less likely to get ahead economically.
        Perhaps most importantly, access to quality healthcare,
    including family planning, is critical to women's economic
    success. The evidence is indisputable: Improving women's access
    to contraception improves their economic well-being. Women who
    are able to plan and even delay childbirth are more likely to
    get an education, raise their standards of living, and climb
    out of poverty.
        That is one reason American policy has focused on expanding
    access to family planning around the world. These efforts have
    seen good results. In the 27 countries with the biggest USAID-
    supported programs, the rate of modern contraception use has
    risen from under 10 percent a half century ago to 37 percent
    today, a good jump, but it shows we still have a long way to
    go.
        Now, the Trump administration has said that it supports
    efforts to empower women and girls around the world, but its
    budget proposal tells a different story. The Trump budget
    completely zeros out funding for international family planning
    and reproductive health and eliminates American support for the
    United Nations Population Fund, the largest purchaser and
    distributor of contraception globally.
        On top of that, the administration has reinstated and
    expanded the global gag rule, which we know has devastating
    effects on women's health around the world. This is a disgrace
    which will set women back across the globe.
        Addressing women's economic participation requires a broad-
    based, integrated, detailed-oriented, and comprehensive
    approach that deals with all the issues I mentioned, plus a
    host of others. The wrong approach is to cut our diplomacy and
    development by nearly a third.
        Fortunately, Congress has the last word on how much we
    spend on foreign policy priorities, and I will continue to
    fight for a robust investment in these areas. So I look forward
    to hearing from our three excellent panelists on these issues.
        And I thank you again, Mr. Chairman, for calling attention
    to this issue.
        Chairman Royce. Thank you very much, Mr. Engel.
        So this morning we are pleased to be joined by a
    distinguished panel, which includes Ms. Mary Ellen Iskenderian.
    She is president and CEO of Women's World Banking, which is a
    nonprofit devoted to helping low-income women in developing
    countries access key financial tools and resources.
        And we have Dr. Tavneet Suri, associate professor at the
    MIT Sloan School of Management. She focuses on the impact of
    digital finance services in developing economies.
        And we have Ambassador Melanne Verveer, who served as the
    former Ambassador-at-Large for Global Women's Issues at the
    State Department. She currently is the executive director of
    the Georgetown Institute for Women, Peace and Security.
        Without objection, the witnesses' full prepared statements
    will be made part of the record. Members are going to have 5
    calendar days to submit any statements or questions or any
    extraneous material for the record. And if we could ask
    everyone to summarize your remarks that would be best, and then
    we will go to the questions.
        So, Ms. Iskenderian, if you would like to start.

     STATEMENT OF MS. MARY ELLEN ISKENDERIAN, PRESIDENT AND CHIEF
                EXECUTIVE OFFICER, WOMEN'S WORLD BANKING

        Ms. Iskenderian. Thank you, Mr. Chairman.
        Members of the House Foreign Affairs Committee, thank you
    for inviting me to speak with you today. My name is Mary Ellen
    Iskenderian, and I am president and CEO of Women's World
    Banking.
        For nearly 40 years we have listened to low-income women in
    developing countries describe their need for financial services
    and then worked with local banks, insurance companies, and,
    increasingly, cell phone companies to tailor convenient and
    affordable savings, insurance, and credit products to meet
    those needs. Women's World Banking currently works with 49
    partners in 32 countries to reach 44 million clients.
        But Women's World Banking can't do this alone. The Global
    Findex tells us that 1.1 billion women, more than half of the
    world's unbanked population, do not have an account at a bank,
    while hundreds of millions more do not have access to the full
    set of financial products. In addition, women own roughly one-
    third of the 200 million businesses in emerging economies that
    have no or insufficient access to credit.
        Providing these women with basic financial services, that
    fundamental first step toward economic empowerment, can unlock
    unprecedented economic growth and job creation and can have a
    direct impact on development outcomes such as health,
    education, food security, and water and sanitation.
        Women spend, save, and invest money in profoundly different
    ways than men. One such difference: When women have discretion
    over their financial choices they prioritize spending on their
    families. On average, women spend 90 cents out of every dollar
    earned on education, healthcare, and housing, in comparison to
    men's 60 cents.
        Improving a woman's financial access brings with it a
    multiplier effect that will be critical to realizing the
    potential of financial inclusion for reducing poverty and
    driving economic growth.
        I am pleased to note that you have entitled this hearing
    ``Beyond Microfinance.'' The traditional microfinance
    institutions established an important principle: Low-income
    people and women in particular can borrow responsibly. But over
    the years we have learned that, like all of us, low-income
    people have complicated financial lives that require more than
    just a one-size-fits-all microloan.
        Fortunately, a broad range of providers, including
    mainstream commercial banks and insurance companies, as well as
    payments providers, mobile network operators, and fintech
    companies, has emerged to meet these needs.
        Yet low-income women face a number of barriers that hinder
    their access to these services. I will touch briefly on just
    three of them along with some potential solutions.
        First, millions of women lack the documentation and other
    forms of identification to open even a simple savings account.
    India has recently implemented an innovative biometric ID
    system that has dramatically expanded access to financial
    services. Elsewhere, tiered ``know your customer'' requirements
    allow women to open no-frills savings accounts with minimal
    documentation.
        The second barrier women face is a lack of collateral.
    Women generally have fewer assets to pledge to a bank and in
    many countries are legally barred from owning or inheriting
    land. In response, some countries have established movable
    collateral registries that better reflect the types of assets
    women can provide to satisfy bank requirements.
        Finally, more than 1.7 billion women in low- and middle-
    income countries do not even own a cell phone. This lack of
    access to technology, combined with lower financial and digital
    literacy, prevents them from fully utilizing digital financial
    services. Once women gain access to their own phone and some
    basic training, however, their usage levels parallel men's.
        Despite these barriers, I am optimistic about the
    opportunities presented by women's financial inclusion. The
    United States can play an important role in accelerating those
    opportunities by joining other developed countries that are
    investing in women's financial inclusion, often led by their
    country's gender Ambassadors.
        The United States can use its influence at the G-20 and
    other fora to push for implementation of more national
    financial inclusion strategies that have explicit gender
    targets. USAID, OPIC, and even Ex-Im could catalyze more
    private sector investment by including requirements in their
    programs to serve women. They could also engage in public-
    private partnerships that serve to derisk private sector
    investment.
        Distinguished committee members, thank you for calling
    attention to the role that women's financial inclusion plays in
    building stronger families, communities, and economies.
        [The prepared statement of Ms. Iskenderian follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                                  ----------

        Chairman Royce. Dr. Suri.

       STATEMENT OF TAVNEET SURI, PH.D., ASSOCIATE PROFESSOR OF
     APPLIED ECONOMICS, SLOAN SCHOOL OF MANAGEMENT, MASSACHUSETTS
                        INSTITUTE OF TECHNOLOGY

        Ms. Suri. Thank you, Mr. Chairman Royce, Ranking Member
    Engel, and members of the committee for hosting this hearing
    and giving me the opportunity to provide testimony on
    empowering women in the developing world. I would like to offer
    three main messages today.
        First, although there has been truly remarkable progress in
    alleviating global poverty across the world, the progress of
    women has not kept up with that of men. We have a long way to
    go toward gender equality in the developing world. For example,
    only 39 percent of the total workforce is female, only 38
    percent of businesses are female-owned even in part.
        Second, all that said, it turns out that a number of
    private sector digital financial technologies are helping even
    poor women in remote areas join the economy and manage their
    money more effectively with profound effects on their economic
    status and empowerment.
        Third, to date, though the private sector has created and
    provided these tools at scale, international aid played a
    critical role. In this case millions of digital transactions
    each day in poor countries can be traced back to be a small
    decision by the U.K.'s international development agency to fund
    a pilot of a new idea. Good, data-driven thinking which brings
    together government and private sector innovations can bring
    big payoffs.
        This hearing is aptly titled ``Beyond Microfinance.'' For
    many years microfinance was thought to be key to lifting poor
    women out of poverty. We now have very strong evidence from
    seven different countries showing that it simply does not.
    There is now a consensus amongst economists that this method of
    putting poor people into debt is not an effective long-term
    poverty solution.
        But there are new findings suggesting that another area of
    finance does empower women: Mobile money. In the U.S., services
    like Venmo or Apple Pay are just taking off. So it may be
    surprising to hear that Kenya's mobile money system, M-PESA,
    has been around for 10 years. It lets people send money to one
    another with just a text message, so it works even on the
    simplest mobile phones.
        And this technology has taken the developing world by
    storm. There are twice as many mobile money payments every day
    as there are PayPal ones. There are over 400 million accounts
    in the developing world, more than half of these in sub-Saharan
    Africa alone.
        With my colleague Billy Jack at Georgetown, over the past 8
    years I have been studying what happened to communities in
    Kenya as M-PESA spread across the country. The first thing we
    saw was how families deal with financial emergencies. The poor
    are never more than one emergency away from financial disaster.
    When a child gets sick, you will do whatever you have to do
    help them get better. The same holds for Kenyans, but in many
    families this meant reducing the amount of food, other basic
    necessities, or even pulling their kids out of school to be
    able to pay for medicine.
        When M-PESA arrived, families could now phone a friend for
    help. They could get money from a cousin across the country or
    a friend in the city. Then in turn, when that friend had an
    emergency, they would repay the favor.
        A few years later we looked at the broader impacts of
    mobile money. When M-PESA came to an area, it reduced poverty,
    it lifted an estimated 194,000 households, 2 percent of Kenyan
    households, out of extreme poverty.
        When we dug deeper, we found something we are not used to
    seeing: The anti-poverty effects were much stronger for women.
    In fact, an estimated 186,000 women in Kenya were able to
    switch from subsistence farming into business and sales
    occupations.
        Just giving women more privacy, flexibility, control, and
    the ability to manage the kinds of financial risks they face
    seems to have been a massive economic boon to them. And all
    that from a simple technology. Remember, it doesn't give people
    cows or loans or any entrepreneurial savvy that they didn't
    have before.
        Our results on women's empowerment are now supported by
    ``fresh off the presses'' work showing that cash grants have
    effects on male-run businesses and not on female-run
    businesses. But this is in part because even when women are
    given cash, often their husbands control where it goes. And in
    India, making government welfare payments electronic and giving
    women control of those payments by depositing the cash in their
    bank accounts improved their economic outcomes.
        One key message from the M-PESA story is how it started: An
    idea of two employees at the private cell phone company
    Vodafone in the U.K., a pilot paid for by the U.K.'s equivalent
    of USAID, and a resulting, scalable, highly profitable business
    model.
        There is essentially no private sector R&D in developing
    countries and aid money here acted as crucial R&D capital for
    the firm. Supporting these sorts of digital innovations and
    technologies will be key to closing the gender gap in economic
    opportunities in the developing world.
        Thank you again for having me, and I will look forward to
    any questions you might have.
        [The prepared statement of Ms. Suri follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                                  ----------

        Chairman Royce. Thank you.
        Ambassador Verveer.

    STATEMENT OF THE HONORABLE MELANNE VERVEER, EXECUTIVE DIRECTOR,
    GEORGETOWN INSTITUTE FOR WOMEN, PEACE AND SECURITY, GEORGETOWN
                               UNIVERSITY

        Ambassador Verveer. Chairman Royce and Congressman Engel
    and members of the committee, thank you for the opportunity to
    speak to you today on an issue of critical importance:
    Increasing women's economic participation and empowerment in
    developing nations.
        Mr. Chairman, let me begin by thanking you for your
    leadership in focusing on global women's issues. They are in
    the vital interest of the United States. Countries with
    declining living standards and inequality are more unstable and
    pose greater challenges to our own interests and our own
    security.
        Empowering women and girls is fundamentally a moral issue,
    a human rights issue. It is also smart and it is strategic. It
    advances our foreign policy as it tackles some of the most
    pressing issues that confront the globe and America's
    leadership.
        This hearing has to do with one of the great challenges
    worldwide: How do we grow economies, create jobs, and ensure
    inclusive prosperity? Today there is a growing body of
    empirical evidence demonstrating the positive impact of
    investing in women and girls. From the World Bank, to the World
    Economic Forum, from countless think tanks and private sector
    analysts, we know that women represent one of the most powerful
    economic opportunities the world has ever seen. The McKinsey
    Global Parity Report found that closing the global gender gap
    could drive more than $12 trillion in growth by 2025 if--and
    this is a big if--much more is done to tackle the obstacles
    that continue to hold women back.
        Micorenterprise development has played an important role in
    lifting up women at the bottom of the pyramid. However, for
    them to grow out of their subsistence businesses is not easy.
    As you have heard, credit is not enough. An intensive package
    of high-potential interventions is required.
        Studies show that women-run SMEs are accelerators of
    economic growth. SMEs occupy that critical space in economies
    where jobs are created and economies grow.
        Yet, if women are to unleash their potential we must
    confront and reduce the barriers they confront. They face
    greater roadblocks than their male counterparts in starting and
    expanding businesses. Discriminatory laws and customs impede
    women's efforts. Violence against women is a global scourge. In
    some places women have no rights to inheritance nor property
    and very little in the way of legal protection.
        Women often lack training, mentors, and networks. Access to
    technology, markets, and access to finance, as you have heard,
    is particularly challenging. For female entrepreneurs to
    unleash their potential, addressing these obstacles will be
    essential.
        Women are also vital to the agriculture sector, and in many
    developing countries they are the backbone of their economies.
    Yet subsistence-level women farmers do not have equal access to
    resources, which limits their productivity. A seminal FAO
    report showed that when women farmers can operate on a level
    playing field, including having land ownership, they can
    increase their individual yields significantly.
        Technology has the potential to revolutionize women's lives
    in the developing world by providing critical access to
    information, mitigating health and safety risk, and creating
    opportunity for financial security and independence. Yet mobile
    technology, as essential a tool as it is, is still out of reach
    for many poor women. Its greatest impact will be in mobile
    banking, which enables women to make the financial transactions
    that they need and to keep their money safe. But the genuine
    good news here is that strides are being made in digital
    financial services that are indeed transforming women's lives.
        The challenge we are addressing today is multifaceted, as
    must be any solution. No one investment constitutes a silver
    bullet. Many development investments are interrelated. Programs
    like women's health, education, freedom from violence, and
    legal rights are critically important to economic empowerment,
    and a Federal budget that drastically cuts these programs will
    only shortchange women, but not only the women around the
    world, it will also shortchange the interests of the United
    States.
        I hope that the committee will also urge the administration
    to fill the position of Ambassador for Global Issues for the
    reasons that I have laid out in my testimony.
        Today some of the largest and most farsighted companies
    understand that engaging in partnerships to advance women
    brings benefits both to society and to companies themselves.
    Public-private partnerships recognize that no one sector has
    the monopoly on competencies that are required in this field,
    nor the resources, but together much can be achieved. And I lay
    out ways that companies today are engaged in these partnerships
    through value chain sourcing, digitizing financial services,
    and so much more.
        The United States should continue to catalyze, support, and
    participate in impactful and innovative partnerships among many
    stakeholders.
        Thank you, and I look forward to your questions.
        [The prepared statement of Ambassador Verveer follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                                  ----------

        Chairman Royce. Thank you. I thank the panelists. And when
    we look at your testimony there are a lot of things that jump
    out that are really quite surprising.
        Dr. Suri, you mentioned your research on mobile phones in
    Kenya, I think. Again, what you just said was 186,000 women
    made the decision as a result of this new form of employment to
    move from subsistence farming to move into business or to move
    into sales. And yet maybe you didn't see the same changes with
    men, but you saw this enormous shift. You know, I think this is
    key. But could you explain maybe a little more of why you think
    this occurred?
        Ms. Suri. Thank you, Chairman Royce.
        So that is exactly right, we did not see men shift
    occupational choice or switch their kind of decision of where
    their income is coming from, but women did. And that number is
    correct, 186,000. So we can't pinpoint exactly why, but we can
    tell you kind of the two sort of leading hypothesizes, which
    are supported by the other work that was in my testimony.
        So one of them is that what M-PESA mobile money did was
    provide extra resilience. So you might have heard the term
    ``high risk, high return.'' Women weren't taking advantage of
    high risk, high return because they were worried about the
    downside risk. They were worried that if something goes wrong,
    I still need to feed my kids, educate my kids.
        And so when mobile money came along and gave them this
    protection from the social network, they were able to take
    advantage of these high risks, high return opportunities like a
    business like sales. So I think that is part of the story.
        I think the other part of the story is it gives them
    control. A lot of these women actually do have cell phones and
    they are able to save on their phones through mobile money, and
    it gives them a sense of access and control to what is on their
    phone.
        And so I think both of those components probably explain
    these findings for women.
        Chairman Royce. So they exert ownership or they exert
    control----
        Ms. Suri. Absolutely.
        Chairman Royce [continuing]. Over what is one's property.
        Ms. Suri. Yes, absolutely.
        Chairman Royce. And that is something that men maybe
    already have, but now that women are empowered in that way they
    basically have a secure property right here, and that lets them
    assume greater risk, as you said, which is the driver of
    innovation, driver of economic growth.
        Ms. Suri. Yes. I like what you said when you opened. You
    said something about women controlling their future. I think
    this allows women to control a bit more of their future.
        Chairman Royce. Another question here, and I will ask the
    panel. Developing countries are increasingly coming to
    recognize the importance of women's economic inclusion. So we
    see countries from Jordan to Kenya, as you pointed out, to
    Nicaragua, they have reformed their laws in recent years to
    improve women's property rights. But this change takes time.
        And we have a Millennium Challenge Corporation here in our
    diplomacy that we use for leverage, and we have had some
    success in encouraging reforms in exchange for U.S. investment.
    And I would just ask the members of the panel here, how can we
    encourage more reforms and what should we be focusing on in
    that effort?
        Ambassador.
        Ambassador Verveer. Well, I think that is an excellent
    question, Mr. Chairman. And it is true that without the kinds
    of reforms and legal protection women are not able to progress
    as they might in the economic sphere.
        I think what the MCC has done over a longer-term trajectory
    as it is organized to do, it certainly has a very strong gender
    component to its work and also is holding governments
    accountable using the leverage of America's investment, as you
    say.
        I think the private sector too. Mobile companies, for
    example, who go in to ask for expansions of regulatory
    opportunities could also be raising issues about women's legal
    protections or ways in which women can enhance their standing.
        So I think we need a combination of people who talk to
    governments, as each and every one of you does when you are on
    a codel, or when they are coming here, to raise these issues.
        You know, we talk about them as women's issues, but they
    are far more than women's issues. They peculiarly affect women,
    there is no doubt about it, but they have a great deal to say
    about all of society and certainly how economies function. So I
    think we should not diminish the aggregation of all of the ways
    to influence governments in making the right decisions.
        Chairman Royce. And I wanted to ask Ms. Iskenderian this
    question too.
        Ms. Iskenderian. Thank you, Mr. Chairman.
        Just to build on Ambassador Verveer's comments, it is a bit
    of a hackneyed phrase, but what gets measured gets done. And I
    think one thing that MCC in particular, but certainly any other
    agencies that are interacting with nations abroad and
    developing countries, can insist that tracking the data,
    tracking the number of women that are being served is done.
        Only 34 percent of cell phone companies today that are
    offering mobile money services even know the gender of their
    clients. So we can't even really assess the nature, the full
    nature of the problem until we actually know who is being
    served, who is not being served, and how they may be different.
        We saw, both of the panelists referred to this, huge
    improvements in financial inclusion between 2011 and 2014 in
    the runup to the Global Findex report. The biggest changes were
    in those countries that had specific national financial
    inclusion strategies that had specific gender targets. That
    would be such an easy thing for us to include in anything that
    we require of a government that we are providing funding to.
        Chairman Royce. Very good.
        My time has expired.
        Mr. Engel.
        Mr. Engel. Thank you very much, Mr. Chairman.
        Ambassador Verveer, let me ask you this. Thank you again
    for coming here. I have two questions.
        While empowering women economically is certainly in line
    with America's values, it is also in America's U.S. national
    security and foreign policy interest because it promotes peace
    and stability in fragile states. You have done a lot of work in
    Georgetown and during your time at the State Department as the
    first U.S. Ambassador on global women's issues on the link
    between women's economic empowerment and national security.
        So I would ask you, in general, how does empowering women
    promote U.S. foreign policy, national security, and economic
    interests? And what role did empowering women economically have
    in Rwanda in terms of economic growth, but also post-conflict
    peace and stability?
        Ambassador Verveer. Congressman Engel, I think the
    connectivity between women's economic agency and participation
    and peace and security is one that is increasingly linked and
    one that we are recognizing as critically important. And I know
    that this panel had a previous hearing in this area of women,
    peace, and security, and what their agency represents.
        We know that in those societies where the condition of
    women is one where they are oppressed and denied their rights,
    those conditions often are the first signs of increased
    instability and potential conflict. I often feel as though
    women are the canaries in the mines. Look at what is happening
    to the women and you will have a sense of what is to come down
    the pike, if we have the vision and the ability to look at
    those conditions and take them seriously.
        I think one of the most important elements as we take
    hopefulness out of situations where countries are coming out of
    conflict is to appreciate that you could have the best peace
    agreement, but if the key issues that affect the people on the
    ground--and one of the critical ones is their economic future--
    are not weighed into those agreements and are not executed in a
    recovery process, you are not going to have that long-term
    sustainable peace that an agreement hopefully would guarantee.
        And in a place like Rwanda, for example, there was a
    recognition, and while so many lives were lost, that women had
    to play a critical role. Today they comprise some 60 percent of
    their Parliament, the highest women's participation in
    legislatures in the world. They are active in ministries. They
    are active in every facet of the decisionmaking processes in
    Rwanda. And I think to some extent, whatever you think of
    President Kagame, he has recognized that the empowerment of
    women has played a major difference in moving his country
    forward.
        In my testimony I note one of the projects that I have been
    involved in included a private sector company, Kate Spade &
    Company, which made a business investment in Rwanda
    specifically for business results, but also to empower women.
    And what we have seen in the case studies that have been done
    on that investment is what a difference it is making, not only
    in terms of their business investment, but particularly in
    terms of women's economic empowerment and social progress for
    those women and their community.
        So, again, the link between economic participation,
    economic viability, opportunity, and sustainable peace and the
    amelioration and the avoidance of conflict go absolutely hand
    in hand.
        Mr. Engel. Thank you.
        Let me ask Ms. Iskenderian this question. What steps do you
    believe the administration should take to promote the economic
    empowerment of women? How and why should they target women from
    poor rural communities just as equally as those living in urban
    centers that already have access to the formal economy or
    banking? And finally, what good does incentivizing legal and
    policy reform do for women from all socioeconomic backgrounds?
        Ms. Iskenderian. That is a tall order.
        Mr. Engel. And you have 18 seconds.
        Ms. Iskenderian. Thank you.
        I think just to make one clarifying point, that urban-rural
    divide that you mentioned. Yes, one of the very exciting things
    about mobile money is that we are able to reach rural
    populations that have been so excluded.
        But just because a woman is in an urban area doesn't
    necessarily mean that she has access to financial services. In
    far too many places we still see the formal finance sector has,
    for example, very, very high minimum balance requirements.
    There is a very strong sentiment on the part of low-income men
    and women that the financial sector doesn't really want them.
    But I think for women there is also this emotional distance, so
    to speak, that they really do not feel respected, their savings
    are not necessarily wanted.
        But those banks that do make that commitment, that do make
    that leap into this new market, find that women are really
    excellent clients. They tend to be the savers, their savings
    accounts are the stickier savers. They are more willing to buy
    cross sold products than men are. They buy more insurance than
    men do. Lots of very good benefits.
        And so I think to whatever extent this administration can
    continue to foster that support specifically from the private
    sector. As I mentioned in my remarks, I think there is a great
    deal we can do in derisking. We have seen a number of the
    development finance institutions from other developed countries
    are providing that kind of support, first-loss guarantees, that
    first step into a market that supports a private sector player.
    But then as they get used to that market, and they see that
    this is a good form of investment, that support can be
    lessened.
        Mr. Engel. Thank you.
        Mr. Chairman, before I go back, I would just ask for
    unanimous consent to enter CARE's written testimony into the
    record.
        Chairman Royce. Without objection.
        [The information referred to follows:]
        ******** COMMITTEE INSERT ********
        Mr. Engel. Thank you, Mr. Chairman.
        Chairman Royce. We go now to Ileana Ros-Lehtinen of
    Florida.
        Ms. Ros-Lehtinen. Thank you very much, Mr. Chairman, and
    thank you to the ranking member, for convening this important
    hearing. And thanks to our witnesses for excellent testimony.
        With so much going on around the world, the Syria conflict,
    the Iranian nuclear deal, North Korea's ballistic missiles, and
    everything in between, lamentably we often overlook the plight
    of women in the developing world and our role and our
    responsibility for helping these women. We know that women in
    many developing countries oftentimes face insurmountable legal,
    cultural, and religious barriers to becoming the full and equal
    members of society that must be their natural right.
        Not only is this a travesty for the rights of women, but in
    many of these countries when women have the same rights and
    access as men, the transition from developing to developed
    countries becomes a reality.
        Preventing half of your population from access to the job
    market and thus the financial tools to help promote economic
    growth is just unconscionable. It is imperative that we discuss
    ways to correct this and that women in developing countries
    have access to the tools and the services so they can have an
    important role in their countries.
        We must also remember that it isn't just the economy to
    which they are being denied access, it starts from the time
    that they are children. Oftentimes women are not even
    registered at birth, putting their future and their well-being
    in danger.
        That is why I have always been proud to support my good
    friend Steve Chabot in his efforts to pass the Girls Count
    Act--and thank you, Steve, for that--to ensure that these girls
    get birth certificates and are registered.
        My goodness, as a former Florida certified teacher, I know
    how important education is to all children, but for women in
    developing countries before we talk about getting them access
    to financial tools, we really need to ensure that they have
    access to a real education. That is why I have authored bills
    to provide Pakistani girls and women access to scholarships so
    they can get the education they require and why I am
    cosponsoring Steve's Protecting Girls' Access to Education Act.
        For women in developing countries we need to start changing
    the fundamental ways in which they are viewed from the moment
    they are born if we are ever going to have a chance at their
    access to the financial services later on, and that is a tall
    task because of the legal and cultural barriers they often
    face. Women in about 18 of the world's economies,
    unfortunately, including many in the subcommittee that Mr.
    Deutch and I head, the Middle East and North Africa
    Subcommittee, require permission from their husbands or legal
    male guardians to work outside of the home, if they are even
    allowed to work at all.
        So I would ask the panel, how do you begin to make a change
    when so much discrimination is ingrained in the cultural norms
    and the societal norms and the values, when women from the time
    of birth are not viewed as equal to men? And how can we in the
    United States leverage our assistance and our role in the
    global stage effectively enough to promote the change that is
    needed?
        Thank you.
        Ambassador.
        Ambassador Verveer. Well, Congresswoman, thank you for
    those remarks and for your leadership.
        It is not all a dismal story. There is certainly a long
    road to climb and a journey that women are on all over the
    world. But there has indeed been progress, and a lot of
    progress has come out of the leadership of our diplomatic and
    development efforts, as well as certainly those of others.
        And I think one of the key issues you mentioned is
    education. It is absolutely fundamental for a girl to be
    educated. Malala took a bullet just to make the case that girls
    have a right to an education.
        It is that megachange component, because we know all of the
    things that come out of an educated girl in terms of the
    benefits that take place over her lifetime, the children she
    raises, the kind of job she has.
        Ms. Ros-Lehtinen. Thank you, Ambassador.
        Any of the other two?
        Thank you, Dr. Suri.
        Ms. Suri. Thank you, Congresswoman.
        I guess I would say I think there are two parts of this.
    Education, I completely agree. I think that is also tied to
    financial inclusion. We have some work in Kenya showing that
    when we gave households access to loans for these water tanks
    where you can store water, the girls went back to school.
        So understanding not just attitudes, but what is actually
    preventing the girls from going to school, what are they doing,
    and how do we try to alleviate those constraints can be
    important.
        I also want to mention some work on India which is
    fascinating, where they required some districts to have a
    third-of-women participation in local government. And they
    looked at the decisions then that the women made versus the
    men. And the women of course have different preferences than
    men. They chose different public goods and different
    investments than the men. Hard to weigh up which ones are
    better or worse.
        But what was really fascinating is they also did some
    surveys on the ground of people and they saw that people's
    views of women started to change when women started to
    participate in local government and they saw women making
    decisions about what the community needed or not. So I think
    that is also something----
        Ms. Ros-Lehtinen. Thank you very much. I am sorry, we ran
    out of time. Next time.
        Thank you. Thank you, Chairman Royce, and thank you, Mr.
    Engel, for convening this important hearing. And thank you to
    Lois Frankel. I know that she was one of the engines behind
    this hearing. Thank you, sir.
        Chairman Royce. Thank you very much, Ileana.
        Albio Sires of New Jersey.
        Mr. Sires. Thank you, Mr. Chairman, for holding this
    hearing. And I always have been very interested in this topic.
    I grew up in a household where machismo was it. My father would
    not allow my brother and I to hang around the kitchen. And I
    still remember the day when I was helping my mother make the
    bed where he picked me up and he spanked me because I was
    helping my mother. He always said that was the woman's domain.
        But a funny thing happened along the way. At the age of 11,
    my parents and I and my brother, we came to America. My mother
    got a job first. All of a sudden, things changed in the house
    so completely. My father was in the kitchen helping her because
    she came in late. My father was helping out with the wash. And
    I always used to tell my father, I said, ``Whatever happened to
    all those things that you taught me in Cuba that I shouldn't
    do?'' And I think he was kind of embarrassed for the way things
    changed. Then later on he got a job and all those things went
    down the tubes.
        I also remember my first day teaching. I taught in a school
    with a lot of Hispanic students and since I was bilingual I was
    the chaperone of the school dances. And the principal said,
    ``You have to come.'' And I used to hang around in a corner
    with about 12 mothers who used to come to the high school
    dances.
        I mean, it is fascinating. And, fortunately, I had two
    great college professors. I went to a Jesuit school in New
    Jersey which was only men, but when I got there it had changed.
    And I had the first woman professor ever and the second woman
    professor. They were fascinating and this topic was always
    brought up.
        But I cannot agree with you more that education and
    economic opportunity changes the whole formula. And I think
    that is what we should strive for when we want to help
    somebody. You know, there are a lot of things that we can do,
    but I think education is certainly our economic opportunity.
    Because I saw that my mother brought the first check and the
    whole thing changed, I mean overnight. And to this day I find
    the whole thing fascinating.
        So I guess what can we do to continue to provide economic
    opportunity for women, because I think that is the only way
    that you are going to be able to change it, and obviously
    education also, especially in the Western Hemisphere. I think
    that machismo is still pretty much alive in the Western
    Hemisphere in all these countries. My district is obviously a
    very predominant Hispanic district, I represent just about
    every country in the Western Hemisphere that speaks Spanish,
    and I hear these stories.
        And I am concerned with some of these cuts for these
    programs for women, you know, how we are going to impact that
    in the Western Hemisphere. Sorry to take so much time. But can
    you talk a little bit about it?
        We will start with you.
        Ms. Iskenderian. Thank you, Congressman. And thank you for
    that story. It is absolutely what we see on the ground. As soon
    as the financial situation shifts a little bit, the dynamic in
    the household changes, a lot of other things can change as
    well.
        I think I just would like to build on some of what we were
    talking about with education, because what we see far too often
    is some of that really fantastic benefit that we all know about
    educating girls gets lost if we also don't prepare them
    financially. So part of that education giving them financial
    literacy skills.
        And what we are seeing in our work on the ground, also
    getting a savings account, ideally in their own names, as early
    as possible. We have been working with an NGO in Africa that is
    graduating 180,000, 200,000 young girls from secondary school
    every year, tremendous progress. But they are seeing those
    girls married within a year, because they don't have savings,
    they don't have life skills. They are not financially prepared
    to go out in the world.
        Mr. Sires. I always figured that one of the issues that
    held my mother back was that my mother was 13 and my father was
    23 when they started going out. I always told my father you are
    going to be put in jail in America if you did that.
        Can you?
        Ms. Suri. Yes, thank you, Congressman.
        I guess I will just add on some of the stuff that was said
    earlier and something that Ms. Iskenderian talked about. If you
    look at the mobile money story, the technology and the
    innovation was seeded by aid money, by a donor. It allowed the
    private sector to kind of derisk what they were doing and
    provide a set of tools that affect women.
        I think thinking through how we provide that R&D capital
    for the private sector and emerging economies is really
    important, because they don't have R&D, they don't do R&D
    traditionally. But if we can derisk private sector investments
    in these countries I think we can get a whole set of new
    technologies and tools to women that I think will really
    benefit them.
        Mr. Sires. I am sorry I ran out of time. Thank you, Mr.
    Chairman.
        Chairman Royce. Dana Rohrabacher of California.
        Mr. Rohrabacher. Thank you very much, Mr. Chairman. And
    again I want to point out that the leadership of Mr. Engel and
    Mr. Royce have again demonstrated that there are a lot of areas
    that we can work together on and that we are choosing issues
    like this that are just somewhat out of ordinary. And so I want
    to thank the leadership for this hearing today and making this
    issue.
        I would like some more specifics from you. You are the
    experts, and I want to know what countries are the good guys
    and what countries are the bad guys. And I guess, first of all,
    what countries would you say are on the super good guy list and
    what are the countries that are on the super bad guys list?
        Ambassador Verveer. Well, I don't know if I would call them
    the good guys and the bad guys necessarily. But there are
    plenty of rankings today, Congressman, and whether it is the
    UNDP's human development rankings or the World Economic Forum's
    gender gap rankings.
        Take the World Economic Forum. Nobody accuses them of being
    a women's organization. And yet they annually look at the
    gender gap between men and women on four metrics in any given
    country: Health, access to education, economic participation,
    and political participation.
        Mr. Rohrabacher. Okay.
        Ambassador Verveer. And when you look at those rankings,
    the Scandinavian countries and others are at the top. And then
    keep going down and you find a lot of the countries that are in
    the most difficult straits today, conflict ridden, poverty
    stricken, capturing the headlines in not the most favorable
    way. They are the places where gender equality is clearly at
    the bottom.
        Mr. Rohrabacher. Are there any poor countries--we are
    saying poor countries versus rich countries then--are there any
    poor countries that have a really good record on this?
        Ambassador Verveer. That is a very good point, because if
    you look at the WEF's rankings you will find some anomalies in
    there, countries perhaps in Latin America and Central America
    or in Africa, because they are looking at the gap based on what
    they have. And as they are closing the gap within the context
    of that country they are making progress.
        Mr. Rohrabacher. Okay. Give me some specifics.
        Ambassador Verveer. I don't have the rankings in front of
    me, unfortunately.
        Mr. Rohrabacher. There are some good guys at the lower end
    of the scale, a lot of bad guys. One of the reasons that their
    countries are poor is because they have oppressed women. And I
    think that it is very clear that if you oppress women you are
    oppressing one half of your population and thus you are cutting
    yourself off from a lot of economic activity.
        But do you have some names for me?
        Ambassador Verveer. Well, you know, several years ago the
    Arab Development Report was published and it has been since
    updated. Arab intellectuals wrote that report. It had
    considerable impact in the region because one of the clear
    indices of why they were not progressing economically in ways
    that they should was the state of women's conditions.
        Mr. Rohrabacher. Sure.
        Ambassador Verveer. Lack of education.
        Mr. Rohrabacher. I understand. I am trying to get a little
    less philosophy out of you and some more specifics.
        Ambassador Verveer. Well, I am talking about the region.
        Mr. Rohrabacher. Okay. Give me some names of countries. Do
    we have any names of country? Give me a name of a couple bad
    guys we should have on our list and say, ``Hey, why do you
    treat women that way in your country?''
        Ambassador Verveer. Look at the situation in Pakistan, for
    example.
        Mr. Rohrabacher. Okay, Pakistan.
        Ambassador Verveer. Or the situation in Yemen.
        Mr. Rohrabacher. Okay.
        Ambassador Verveer. You know, these. And then look at the
    state of those countries. Certainly at the bottom in terms of
    equal opportunity and----
        Mr. Rohrabacher. Thank you, that is what I was really
    looking for, Pakistan and Yemen. Of course, let's keep that in
    mind when we are dealing with those countries.
        By the way, let me just note women's role in the military
    in various places. The Kurds and the Israelis seem to have
    women playing a major role in the security of their country.
    Are there countries, other countries like that, that we can--
    the United States has really increased the role of women in our
    military. Who are the good guys and bad guys in terms of
    utilizing women within their government and their military?
        Ambassador Verveer. You have raised another critically
    important issue, the participation of women in the security
    sector. I think there are some seven or eight ministers of
    defense now in the European countries who are really moving
    this agenda forward. As you mentioned, we are making some
    progress.
        It is still a significant problem in U.N. peacekeepers, for
    example. There are very few women in the ranks of peacekeepers.
    Yet a major part of their mission is the protection of
    civilians, and it is often women who are in the most difficult
    straits in the places where they are keeping the peace.
        In military service and in police service, whether it is in
    Afghanistan or other places of conflict, to raise the
    participation of women.
        Mr. Rohrabacher. Well, let's just note--Mr. Chairman, thank
    you. And we note here that on Capitol Hill it was a female
    police officer that saved the lives of several Members of
    Congress who were under attack.
        Thank you very much, Mr. Chairman.
        Chairman Royce. Thank you, Mr. Rohrabacher.
        Ami Bera of California.
        Mr. Bera. Thank you, Mr. Chairman.
        I was listening to my colleague, Albio Sires, talk about
    his upbringing. When I think about my own upbringing in an
    immigrant household, both my parents worked, but my mom had
    multiple jobs, making sure me and my two older brothers got
    ready for school, making sure that we had something to eat,
    making sure that we did our homework, and the importance of
    empowering women to be kind of that glue.
        I would like to ask a couple questions. I think, Ms.
    Iskenderian, you talked a little bit about kind of going
    cashless. India is doing a pretty interesting experiment right
    now. And maybe it is not an experiment, it actually seems to be
    going fairly well. And I would be curious about the thoughts of
    going to this cashless economy and digital economy and the
    impact that has both bringing women, but bringing everyone into
    the traditional economy.
        Ms. Iskenderian. Yes, it is truly remarkable, Congressman,
    what India has been able to accomplish, and the government has
    really just driven financial inclusion. They have, as I
    mentioned in my remarks, instituted this biometric system. So
    everybody has a thumb print, and that has been available to men
    and women alike.
        There are some things that we would love to see changed in
    this, because when the government is then looking at financial
    inclusion they are looking at household financial inclusion.
    And so we don't always know, but when we dig into the data that
    typically means that the husband has taken that biometric
    information and opened the bank account rather than the wife.
        But not in all cases. And we are very excited about the
    opportunities. You probably heard recently about the
    demonetization. India took several currency notes out of the
    system. It was particularly difficult for women who still were
    operating in cash and didn't necessarily have access to the
    technology for a variety of reasons, including cultural and
    social reasons. They didn't own the cell phone.
        So we are eager to make sure that women are not left behind
    in this exciting move toward the cashless economy.
        Mr. Bera. Dr. Suri, did you want to add?
        Ms. Suri. Yes, I am happy to add, and thank you for that
    question. I will mention a couple of things on the digitization
    in India which, like Ms. Iskenderian said, has been impressive.
    When they started off I really didn't think they would succeed
    at giving most of their population a digital identity.
        I think there is a bunch of research now showing great
    gains to this. One has been as they digitized people's identity
    they digitized a bunch of the social welfare programs from the
    government. And this has dramatically reduced corruption in the
    government because you can't have fake people anymore in the
    system and I can't sign up Ms. Iskenderian and pay her on the
    side. So you see a reduction in corruption.
        And then, accompanying that, we have seen some luck where
    when women earn the money off the workfare programs, if it is
    tied to a bank account that they have that is theirs, it
    increases their labor force participation and their earnings.
        So I think it can't be just digitization on its own
    because, as Ms. Iskenderian said, that doesn't mean necessarily
    financial inclusion in the way we think about it for women and
    financial use. But when I can tie that digitization to now
    financial tools and other things, then you do see this benefit
    for women.
        Mr. Bera. Ambassador.
        Ambassador Verveer. Thanks, Congressman.
        You know, one of the things that has always affected me
    traveling throughout the developing world is how terrified
    women are that the meager earnings that they may have will not
    be safely kept, because either it will be taken from them
    within their household or through bribes of one kind or another
    that they have to pay for essential needs. And this overriding
    concern is something that I think these changes that we are
    talking about this morning begin to really address in a serious
    way.
        And I think today you see more and more of the governments,
    as Dr. Suri said, taking their welfare payments, many of them
    targeted to the woman, for education and health and essential
    needs of her children, and, increasingly, that is coming in a
    card. It is digitized in a card.
        So the cash is gone. She can't be targeted in the way she
    is used to being targeted and vulnerable. The corruption, as
    Dr. Suri said, begins to be addressed, and that is serious
    problem everywhere, as we know. And she goes with that card to
    get the essential items that she needs for her family.
        So this is revolutionizing that great fear that most poor
    women have in keeping their earnings safe.
        Mr. Bera. Great. Fantastic.
        I yield back.
        Chairman Royce. We go now to Joe Wilson of South Carolina.
        Mr. Wilson. Thank you, Mr. Chairman.
        And thank each you for being here today. This really has
    been fascinating to hear. The cell phone use in Kenya--how
    incredible, how positive.
        And, Dr. Suri, the House of Representatives, with the
    bipartisan leadership of Chairman Ed Royce and Ranking Member
    Eliot Engel, has a long history of promoting women's economic
    empowerment in developing countries through various pieces of
    legislation, including funding for microenterprise development
    programs focused on women entrepreneurs and last Congress'
    Global Food Security Act, which supported improved property
    rights and technical assistance for female farmers.
        In a time of limited resources, where should we be focusing
    our efforts now? Where can we get the best return on our
    investment?
        Ms. Suri. Great. Thank you, Congressman, for that question.
        I think I would echo something Ms. Iskenderian said earlier
    and something I have said already. One is measurement.
    Measurement, measurement, measurement. We are still figuring
    out what works effectively and what works best, and I think
    trying to encourage measurement.
        You know, we talked about property rights and how people
    have changed laws around property rights. Changing laws isn't
    enough because it might not actually be implemented, right? And
    so understanding whether those laws have actually trickled down
    to changing women's rights for inheritance is important. I
    don't think we have an answer to that.
        So I would say measurement is really important. Evaluation.
    Understanding what works and then investing in the things that
    work is really important.
        And this ties back to what I was saying earlier. There is
    not a lot of R&D capital-type stuff in these countries. And so
    trying to be the provider of sort of the risk investment and
    the measurement, kind of let's figure out what works and then
    invest in that, allows us to kind of use that capital very
    effectively, and then the private sector can build on sort of
    the things we are finding.
        So that is where I would see it.
        Mr. Wilson. And we would look forward to, each of you, on
    any legislation that we pass, for your advice on what we can do
    better.
        A side issue is that I have seen other organizations, like
    the International Association of Credit Unions. I was present
    in, of all places, Novosibirsk in Siberia, and it was so
    encouraging to me to see the establishment of credit unions
    where microloans were made to women to sell cosmetics door to
    door. At that time, in the late 1990s, that was utterly
    revolutionary in post-Soviet Russian Federation. So, over and
    over, so much can be done.
        And, Ms. Iskenderian, widespread lack of official
    identification in developing countries disproportionately
    affects women and girls, without which it is hard for them to
    obtain even basic services such as a bank account. This
    committee has passed legislation, the Girls Count Act, to
    promote birth registration for girls in developing countries.
    But for these women who do not have a birth certificate or
    other official identification, what are some of the new
    technologies that are helping them to gain access to important
    financial tools?
        Ms. Iskenderian. Thank you, Mr. Congressman. And thank you
    very much to the committee for having supported that
    legislation.
        The lack of a birth certificate just stops a woman's
    progress right out of the gate, literally. So as we were
    referring earlier, the biometric identification tool is very,
    very exciting.
        And we are excited that there is going to be sort of
    further south-south cooperation. India is now sort of going on
    the road with their technology. We do quite a bit of work in
    Nigeria where they have a similar technology. But where India
    has literally a palm-sized piece of technology that they can
    take out into the field and get the fingerprint. In Nigeria the
    machine is like the size of this table. So getting the
    technology right even with that great idea is absolutely
    critical.
        As I also mentioned in my remarks, something that is really
    not a technology, but something as simple as reducing Know Your
    Customer requirements for somebody to open a bank account with
    a cell phone photo, basic identification.
        In Nigeria there is a 150-page questionnaire that you have
    to fill out regardless of what you are trying to do with that
    bank account. When they instituted Know Your Customer
    requirements that were tiered to open simple savings accounts,
    you not only saw financial inclusion dramatically increase, but
    you saw the banks, the private sector banks, going in. It was
    now affordable for them to serve these customers because they
    didn't have those heavy documentary requirements.
        Mr. Wilson. And thank you for highlighting where it is
    working and also suggesting changes where certainly technology
    could be better.
        Thank you. And my time is up. And, again, thank you so much
    for all of you being here today.
        Chairman Royce. Lois Frankel of Florida.
        Ms. Frankel. Thank you, Mr. Royce and Mr. Engel, for this
    hearing today. Terrific.
        Thank you to all of you. And thank you for all your work.
        I am going to assume that you all agree that the President
    needs to fill this position of Ambassador of Global Women's
    Issues as soon as possible. That is something you all agree on.
    Yes. Okay. Yes, you are all shaking your head yes.
        And Representative Torres asked me to associate herself
    with some of these remarks I am going to make and some of these
    questions.
        Thank you for your talking about trying to connect women to
    technology and to cell phones. But I think you would all agree
    that a cell phone is not a replacement for an IUD or birth
    control pill, access to healthcare. It can help, I guess, get
    you the money, right?
        A couple points that I would like you to touch on here are
    for women to be productive, they cannot just be reproductive,
    correct? Yet, we have seen this administration expanding the
    global gag rule, zeroing out funding for family planning,
    cutting off funding for the U.N. Population Fund.
        And, listen, I am not just talking about abortion, okay?
    That is controversial. Let's just talk about someone being able
    to plan their families. I would like you to touch on the impact
    of women not having full access to healthcare and being able to
    plan her own family, how that affects them economically.
        And the second thing I would like you to touch on is, we
    have heard some talk about a new World Bank fund. We are giving
    $50 million to it. I would like you to relate that to your--a
    woman's fund, yes. I would like you to relate, if you can, that
    to your discussion.
        Ambassador Verveer. Well, thank you, Congresswoman.
        I couldn't say it better in terms of the critical nature of
    how these investments in women are interrelated. Think of any
    American woman. If she doesn't have access to family planning,
    for example, if she voluntarily wants access to family planning
    to be able to conduct her life, take care of her children, give
    them the best that she can provide, and succeed in her work,
    then she is constrained. She is severely constrained.
        A poor woman's problem is that much greater. I have been in
    so many settings where women--one woman I remember vividly,
    five girls, five boys. She said to me, ``This is too many
    children. I can't take care of them. I don't know what is going
    to happen to them. We have nothing.''
        It is so significantly entwined with their futures, with
    their economic viability, with how they take care of their
    families. You can't work if you are sick. You can't work if you
    are so constrained. So that goes without saying, as far as I am
    concerned.
        In terms of the women's entrepreneurship initiative that
    Ivanka Trump has been associated with and that is part of this
    World Bank partnership, I think it is a good thing. It provides
    loan guarantees which we have seen work significantly. Ms.
    Iskenderian has talked about ameliorating risks, for example.
    Banks will not make these loans to women, small businesses, or
    medium-size businesses unless, frequently, there is a guarantee
    that they won't lose everything on that loan.
        And this is supposed to, with the Bank's work, involve
    training as well as other aspects of financial support and
    related supports. And there have been commitments from other
    governments as well.
        But the point is, that is a good initiative, but if in
    isolation we cut everything else, then what has it achieved?
    And I think that is what we have to keep in mind. We can't just
    do one thing and expect magical results. We need to understand
    the complete person in these cases, what she represents, what
    she represents for her country, what is in our vital interests,
    and make decisions accordingly.
        Ms. Frankel. Thank you.
        Ms. Ros-Lehtinen [presiding]. Thank you, Ms. Frankel. Thank
    you.
        We will now turn to Mr. McCaul of Texas, the chairman of
    the Homeland Security Committee.
        Mr. McCaul. Thank you, Madam Chair.
        And thank you for being here today, all three.
        I remember several years ago reading a book called ``Inside
    the Kingdom: My Life in Saudi Arabia,'' written by Carmen Bin
    Ladin. She is a European woman who married into quite a family
    that everybody knows about today. But she talked about 1979
    particularly and how life was in the kingdom before the
    Ayatollah came into power in Iran and changed the entire region
    and then how life was after that event in 1979. And we all know
    it changed Iran, but it also fundamentally changed the Arabian
    Peninsula and Saudi Arabia, really rolling back time as it
    pertained to women.
        And, of course, the dress came back with the burqas and
    women were no longer able to drive in the kingdom and were not
    able to go outside, only at certain times, couldn't go into
    certain premises. Just highly restricted, very oppressive
    society. And it is very sad to think the direction it was going
    before 1979 and where it is today after 1979. I have had the
    opportunity to visit, as many Members have, Saudi Arabia and I
    have seen that oppression. It is very dark. I have seen that
    firsthand.
        I have seen that same oppression in Afghanistan, just a
    little different color of burqa. It is more of a beautiful blue
    color. Pakistan, as you mentioned. Yemen. And it is a change in
    their laws, but more, I think, a change in their culture.
        And I guess my question, and it is a very basic one, is how
    do we change that? How do we change that fundamental culture so
    we can lift that oppressiveness off of these women?
        Ambassador.
        Ambassador Verveer. Well, it is a very good question,
    Congressman, and I think it is a critically important question.
    Because we know that you need heat at the top. You have to
    change laws. You have to respect human rights. But you need
    heat at the bottom. And that comes from the people and their
    mindsets. And the mindsets, whether it is the Wahhabists and
    what they are perpetrating or whether it is customs saying this
    is how it is, it puts women down and really in many ways
    affects their human rights deeply.
        But there are a number of examples today where these
    norms--culture can change. But you have to work at it. And you
    do need heat at the top and you need heat at the bottom.
        And, for example, this issue of female genital mutilation,
    FGM, it is a horrific custom that many go through, many women
    go through, because it is about their future. If they don't,
    their future is inhibited in significant ways.
        But where there have been efforts, and they are documented,
    and there are successes every day. For the community to come
    together and understand what this does in terms of harming the
    health of the woman, potentially meaning maternal death in
    terms of childbirth, the consequences are huge.
        It takes village fathers, it takes imams, it takes the men,
    and the community coming together, and in place after place
    norms have changed. The norm went from FGM to the health of the
    woman. It takes time, but we have to work at it. And education
    is a critical element in all of that.
        Mr. McCaul. And I know the young Saudi crown prince who
    will be the king one day has a more progressive point of view
    with respect to this and with respect to the role of women in
    his society, and hopefully that will provide a change as well.
        Are there any other examples of a fundamental change in
    some of these countries that has made a difference in the lives
    of women? Perhaps the other two witnesses.
        Ms. Iskenderian. Thank you very much for the question,
    Congressman.
        I would just refer to some work that we are doing in
    Pakistan currently with a mobile company, mobile cell phone
    company that is offering financial services. And we went in,
    actually, as a group of Western women, feeling pretty
    unambitious or we didn't think we would be able to really
    achieve very much.
        But the company was seeing real change in youth dynamics
    and the generational dynamics, that, yes, it was difficult for
    unmarried girls to have access to cell phones, fathers really
    were not comfortable with their girls having cell phones, but
    since so many of the husbands of slightly older women had grown
    up with phones and they wanted their wives to have that access,
    we saw a real change and a real opportunity for----
        Ms. Ros-Lehtinen. Thank you so much.
        Thank you, Mr. McCaul.
        Mr. McCaul. Thank you. And sometimes I have to ban cell
    phones from my teenage daughters every now and then.
        Ms. Ros-Lehtinen. And now we are pleased to turn to
    Congresswoman Tulsi Gabbard of Hawaii.
        Ms. Gabbard. Thank you very much. Thank you for the
    important work that you are doing and for being here to really
    add to this important discussion today.
        I would like to touch on a couple of things with regard to
    the use of mobile money and M-PESA in Kenya, but how it is
    shown to be less effective in other countries. I think recently
    M-PESA was shut down in Albania, affecting nearly 250,000
    users.
        So if you can talk about what are some of the barriers that
    still exist, and how you recommend public-private partnerships
    to break through this. Why does it work in places like Kenya
    and not in places like Albania?
        Ms. Suri. Sure. Thank you for that question, Congresswoman.
        So I will say a couple of things. One is that we are now
    seeing results out of Bangladesh that find the same sort of
    financial resilience effects we were finding, which is brand
    new work out of Bangladesh. Similar results in Tanzania. And we
    are replicating in Uganda. So in a few months I will be able to
    tell you the results for Uganda.
        You know, I think one key component of mobile money and why
    it has worked in Kenya is actually the business model. They
    knew when they did this pilot that was funded by the British
    aid organization that people wanted to use this technology to
    send money across distances, right? The people who invented
    this thought it was for microloans: Oh, this will be a way for
    people to pay off loans.
        Turns out very few people have microloans in Kenya, and
    they didn't want it for that. They wanted it to send money 200
    kilometers because there was no way to do that. And so they
    rebranded the product, number one.
        And, number two, they realized, like, I can't just have my
    cash in, cash out points be in the city. If I have them only in
    the city, no one is ever going to use it. I need cash in, cash
    out points everywhere.
        So the private company invested in this network of agents
    to cash in, cash out, that when they started was already four
    or five times the size of the banking infrastructure. Today it
    is 130 times. A cash-out agent is about half a kilometer, you
    know, 5, 10 minute walk for almost every Kenyan, for the
    average Kenyan.
        So that business model of needing to be everywhere rather
    than in the cities was really, really key to this being
    successful. A lot of people who have copied it don't think
    through the business model. They think through the technology
    and say, oh, I can copy that technology, but they think, oh, I
    am a banker, I am going to start in the capital city and see
    how it goes before going anywhere. But if you do that, you are
    going to restrict the entire purpose of the technology.
        And so I think people haven't quite picked up on the
    business model is one, and how crucial that business model is
    to the success of what the technology is meant to do. And I
    think the U.K. aid pilot allowed them to realize that what we
    were thinking is wrong and we need to do something completely
    different. So that is one aspect.
        I think the other is kind of investing heavily in the
    platform that develops this technology. So talking about the
    risk investment is, I think, important here too.
        So those are the two, I think, big success cases. And there
    are countries that are not allowing it regulation-wise. You
    know, they are worried it is sort of outside the formal banking
    system and what does this imply. And so I think there have been
    some agencies trying to take the Kenya example and regulators
    from Kenya around to talk to people to try and get them to
    understand what are the right sorts of regulations you need to
    have in place to avoid money laundering and to avoid the risks
    that you traditionally think of in the banking system.
        Ms. Gabbard. And my next question was about collateral. I
    think a couple of you have mentioned that as one of the
    barriers for women, in particular, that has to be overcome with
    regards to property rights and other things. So if you could
    expand a little bit about how that barrier is being overcome.
        Ms. Iskenderian. Again, thank you very much for the
    question.
        As I mentioned in my remarks, we are very excited about
    this growing trend of movable collateral registries that we are
    seeing. Fifteen countries in Africa alone are going to have
    movable collateral registries coming online in the next 2 to 3
    years.
        In China, when they implemented a movable collateral
    registry, they allowed accounts receivable, things that we take
    for granted in our banking system, to be used as security
    against a loan, we saw a massive increase in SME lending, two-
    thirds of which was to women. So being able to have access to
    other forms of security is really critical.
        We are also seeing some exciting fintech solutions where we
    are providing alternative credit scoring. The ability to track
    behavior, track payments, track interactions, transactions,
    digitally is allowing us to have algorithms that do track to
    creditworthiness.
        Ms. Suri. I will just add one bit. I think the other way to
    fix some of this is to provide loans that are for assets.
        Ms. Gabbard. Right.
        Ms. Suri. So some of the work we did in Kenya, we gave
    loans for a water tank. And some people like to have cash. And,
    like, no, no, it is for the asset, and the asset is the
    collateral. And that allows them to get a loan for an asset,
    and then you can recollateralize that asset once it is paid
    off.
        Ms. Gabbard. That is great.
        Ms. Suri. And so I think that is another way to do it, is
    to say let's do mortgage-style lending. It is not a mortgage
    because that is a big amount. But even for a $200 asset, let's
    structure it where the asset is collateral.
        Ms. Gabbard. Great.
        Ms. Suri. And that allows you to then keep that collateral
    once it is paid off and recollateralize.
        Ms. Gabbard. Thank you so much.
        Ms. Ros-Lehtinen. Thank you, Ms. Gabbard.
        We turn to Congressman Scott Perry of Pennsylvania.
        Mr. Perry. Thank you, Madam Chair.
        Thank you, ladies, for being here.
        I am fascinated to a certain extent, Dr. Suri, by your
    story in Kenya. I have two daughters. And I haven't been to
    Kenya. I have read, of course, and I can only imagine the
    culture, right, and how if the woman, even though she might
    have the money, if she has it physically, where the man might
    take it and control it, et cetera.
        So in the greater context, though, we are going to spend
    about $35 billion on foreign aid this year, right, the United
    States taxpayers are going to spend that. And I have this study
    from the GAO regarding how the different agencies are doing,
    how they spend their money, and the efficacy of the goals. It
    is pretty sad.
        For instance, DoD, of the high quality, generally met all
    applicable criteria, zero. Zero. Now in that context, it is
    DoD, right? I would contend that this should not be DoD's
    mission, right? But, apparently, people contend it is, and we
    have sent money to them and they get pretty poor results. But
    even at the State Department, they are up to a whopping 4
    percent. USAID does a little better at 26. Millennium Challenge
    Corporation, believe it or not, 44 percent.
        So I guess my question is--and one of you, I don't know if
    it was Ms. Iskenderian or Dr. Suri, said if you measure it,
    that is the key. Well, somebody is measuring it here, but I
    don't know that we are making the changes that we need to based
    on the measurements.
        So for each of you, your top three policy recommendations
    for us policymakers to make a difference so that so we change
    this zero to something meaningful. And if it means DoD doesn't
    spend any of this money and it is sent to the Millennium
    Challenge Corporation, so be it.
        But you are the alleged--you are here because of your
    expertise, right? So we are looking for some answers from you
    on how to do the job better than we are doing, which is
    apparently abysmal, if you look at the GAO study. So anybody
    care to venture?
        Ambassador Verveer. Well, I will start.
        I think, given this hearing, one of the critical things in
    government that doesn't happen is to look at the gender
    influence, if you will, integrating gender into these issues.
        A lot of these issues aren't women's issues. Take farming,
    agriculture productivity. We know that women farmers, for
    example, often are the backbone of their economies, where there
    are ag economies, and often comprise the majority of the small-
    hold farmers. Yet, when we have ag policies, do we integrate
    that consideration in terms of what women need as opposed to
    male farmers? Those are often different needs for productivity.
    If we did bring those issues to the table, into our
    consideration, we would have dramatically different results.
        And with food policy and food security issues, it is
    critically important to do that. And we have seen from the
    studies that have been done that where this is a major
    consideration, you have outcomes that are different.
        Mr. Perry. Okay. That is fair.
        Ambassador Verveer. Another one is----
        Mr. Perry. I want to be quick.
        Ambassador Verveer [continuing]. Measuring and evaluation.
    And it is data. We talk about data. It is the cat's meow. It is
    something we should all be doing. But we are not willing to pay
    for data collection. And I think that is a very big issue in a
    lot of the grants that are made and in decisions.
        Mr. Perry. Okay. What else you got?
        Ambassador Verveer. Another one is looking at the evidence-
    based case, what is working and what is not working, and quit
    repeating the mistakes, and scale what is scalable.
        Mr. Perry. So just in that point, we are going to need some
    help from outside organizations because, for instance, I have
    to tell you that when you go to cut some of the money going to
    DoD for these programs, can you imagine the panoply of names
    that we are all going to be called around here if we say one
    cent less for X? That is where we need your help, to point out,
    look, this is not effective, it is nothing personal, but let's
    spend the money here. We will do the same mission, but somebody
    else does a better job.
        Yes, ma'am.
        Ms. Suri. So I would say three things. R&D, we do not do
    enough about learning what works, and testing and
    experimenting. You know, the Poverty Action Lab that I am
    affiliated with at MIT is doing this with policy. Let's go
    experiment and see what works. Think of the title of this
    hearing, microfinance. We thought this was the silver bullet
    for women. Turns out, it doesn't do that at all.
        Mr. Perry. Right.
        Ms. Suri. We have now seven studies.
        So I think really doing what R&D would do, which doesn't
    exist in developing countries, not just measure, but evaluate,
    test, experiment.
        I think working with the private sector. The private sector
    in developing countries is showing an ability to scale in a way
    that others don't have. Mobile money is scaling across the
    developing world faster than most things. And so seeding kind
    of innovation in the private sector, I think, can get you lots
    of gains.
        Mr. Perry. I am sorry. My time has expired. I am happy to
    talk to you afterward. Thank you.
        Ms. Ros-Lehtinen. Thank you so much. Thank you.
        Now we are pleased to turn to Robin Kelly of Illinois.
        Ms. Kelly. Thank you, Madam Chair. And I want to thank the
    chairman and ranking member for holding this hearing on
    empowering women in the developing world.
        This is a multifaceted issue that is particularly important
    to me. That is why Congressman Chabot and I introduced H.R.
    2408, the Protecting Girls' Access to Education in Vulnerable
    Settings Act. Giving women and girls access to quality
    education not only increases their economic potential, but it
    is directly related to conflict prevention and reducing gender
    gaps.
        Already, one in five girls in developing countries who
    enroll in primary schools never finish. And I am concerned this
    Trump budget, unfortunately, will drive more women and girls
    out of school as a result of very concerning cuts to foreign
    aid.
        USAID found that when 10 percent more girls go to school, a
    country's GDP increases on average by 3 percent. Education
    provides a multiplier effect. When women and girls are more
    educated, they have greater decisionmaking power in their
    households, are less likely to be recruited by extremists, and
    have healthier and better educated children.
        Before I ask my question, I will say, someone asked who
    were the good guys and the bad guys. And as the past chief of
    staff to the Illinois State treasurer and the current co-chair
    on the Caucus of Black Women and Girls, I do feel that the
    United States of America needs to look at itself too. It is not
    just in developing countries that there is work to do. We have
    a lot of work to do here.
        But can you suggest the best leverage, how can the U.S.
    best leverage foreign aid money into programs that help women
    become more financially secure so that people do feel
    comfortable with the money that we are spending and we are
    giving to these countries and programs?
        Ms. Iskenderian. I would reiterate my fellow panelists'
    focus on data, on monitoring and evaluation, and let's stop
    making the same bad investments and really start scaling the
    ones that do work.
        The other thing I would really add, though, is, again, that
    focus on the private sector. One of the things the United
    States does do very well domestically is on procurement and
    requiring a diversity in procurement policies. We should be
    doing that more with both our own private sector that is
    working in developing countries and that are getting government
    funding to do that, as well as encouraging the private sector
    in those countries itself to diversify their procurement.
    Having those women-owned businesses that we have been talking
    about in the supply chains of those companies can make an
    enormous difference and they have tremendous difficulty
    accessing finance.
        And then I am just a very big fan of OPIC. And it is a
    program that gives back to the U.S. Treasury rather than only
    taking. And there is no gender mandate that is explicitly in
    the OPIC program. And I think there could be, again, a lot of
    private sector and a great deal of leverage there.
        Ms. Kelly. Anybody else?
        Ms. Suri. Yes. Ms. Iskenderian said it well. I would
    reiterate just evaluating and really truly understanding what
    works is very critical. And investing in that knowledge base
    will help everybody across the developing world. And so I think
    investing in the knowledge base of what works and what doesn't
    work, which is so underinvested in in developing countries, is
    essential.
        And Ms. Iskenderian mentioned OPIC. I will say thinking a
    little more innovatively about how aid organizations can invest
    and work with the private sector is key.
        If you look at Norway, the government has a--it is hard to
    say this--the government has a private equity fund, Norfund,
    right, completely private equity, Silicon Valley style, does
    investments with returns. And they are playing around with what
    their role should be and how they should structure that role.
    And I think it is interesting to see how that will evolve over
    time and whether that is an interesting model. But I think
    thinking of innovative models of how to structure our
    interactions is important.
        Ambassador Verveer. Well, just very quickly, we are all
    singing from the same hymnal. But I think in terms of the
    private sector, there is some really impactful, innovative work
    going on using supply chains and value chains, and government
    participating in some of these collaborations in ways that we
    have talked about and haven't talked about, which I think is
    critically important.
        And then I would say incentives, incentives to change
    behavior. You talked, Congresswoman, about education. What does
    it take to keep that girl in school? How do you affect the
    families that often want to push them into a child marriage,
    say? So incentive policies that help us do what we are
    intending to do.
        Ms. Kelly. If I would say to you, can you think of a
    program right now that you would tell us we should not repeat,
    do you have programs in your mind? You don't have to tell me. I
    just want to know.
        [Nonverbal response.]
        Ms. Kelly. Yes, you do. Okay.
        I yield back.
        Ms. Ros-Lehtinen. Thank you so much, Ms. Kelly.
        And we turn to Mr. Donovan of New York.
        Mr. Donovan. Thank you, Madam Chairwoman.
        You have identified, outlined, and vividly described what
    the issues are. I appreciate that for someone who is trying to
    understand it.
        I have one question. It is actually in two parts. And I
    open it up to the panel.
        A lot of the things that you have identified as the
    problems are caused by countries in which we don't create their
    laws and we don't support their culture and how they treat
    women.
        What influence could the United States use, since we can't
    change their laws--and I think some of my colleagues hit on
    this peripherally--what leverage could we use to encourage
    countries to change those laws besides appropriations? Our
    Appropriations Committee will do that.
        But what kind of policies, what kind of things could we do
    to influence some countries to change either their laws or
    their cultures on how they treat women?
        And the other thing, the other part of my question would
    be, what laws could we propose? What could this committee do in
    order to advance--I won't even say advance--get up to speed of
    how the cultures treat the female populations of their
    countries?
        Part of my great interest in this is I have a 2-year-old
    daughter. So women's interests have really--they have always
    been an interest of mine. And I don't want to say, Madam
    Chairman, because I am interested in women. But it has always
    been a concern of mine, the equality of women's rights in our
    country, but now that I am on Foreign Affairs and I am seeing
    the disparity in how women are treated in other parts of our
    world.
        I would just like your expertise in how, again, our country
    can influence or encourage or use our leverage to advance
    women's rights elsewhere. And then what can this committee
    actually do? And I just leave it in any order to the panel as a
    whole.
        Ambassador Verveer. Well, I will kick it off by saying one
    thing that has always impressed me is not the lecture from the
    West so much that makes the difference, but our ability to help
    raise up the voices within the country who want this kind of
    change--women who want family law reform who cannot only
    succeed at doing it when they come together, but actually help
    their sisters in other countries who are in the same kinds of
    cultures and wondering how do we get there.
        Mr. Donovan. As you said before, pressure from the bottom?
        Ambassador Verveer. Well, bringing women together so that
    the best practices in one place can be understood and applied
    in ways that are appropriate to the other place, validating the
    efforts and enabling others to benefit from those best
    practices.
        Ms. Suri. Thank you for that question. It is a hard
    question.
        I guess I would just say that it is not just laws, because
    in a lot of these places you can set all the laws you want but
    whether they are actually adhered to is a different matter.
        And so I think, as Ambassador Verveer said, like thinking
    how we actually get the perception of women changed on the
    ground is kind of key, not just the laws. So as women start to
    participate more and more, it seems that the attitudes start to
    change.
        So the example I gave was from India where a regulation
    required women to be part of local government, very low-level
    local government, and it didn't change expenditures, but it did
    change people's perceptions that women were good
    decisionmakers. The men were more likely to think that.
        So I think kind of thinking through not just what laws, but
    how do you actually change things on the ground, that when the
    laws come in they actually will have impact, is probably
    important as well.
        Mr. Donovan. The Indian Government changed that law. We
    can't control what laws the Indian Government passes. So I am
    trying to figure out how could we influence.
        Ambassador, I think your comments are pertinent to that.
    What leverage could we use?
        And then, again, if there is something that this committee
    could put forth.
        Ms. Iskenderian. I would very much echo Ambassador
    Verveer's use of best practice. The best learning is peer
    learning. And it is often very difficult for people to hear an
    American voice suggesting something, and hearing another woman,
    another company, another bank from a developing country talk
    about their experience.
        We have done some amazing work in Jordan in microinsurance
    that has benefitted women's maternal health tremendously over
    the last 3 years. The insurance company we work with just came
    back from Egypt where they were spreading the gospel. Private
    company. It wasn't a government program at all. Whereas in
    Egypt, the government had requested this private company to
    come and explain how they had gotten this product to work so
    successfully. And that is going to be so much more powerful
    than anything that we could say.
        You know, I would also just say we have a very loud or
    could have a very loud voice in international fora that I don't
    think we always use. In the subject of financial inclusion at
    the G20, we are not advocating for any of these issues as a
    government. We are very focused on issues about antiterrorism
    financing, money laundering, all of which is very, very
    important. But we don't even add this as an issue that we are
    standing with those other 19 countries and advocating for.
        Mr. Donovan. There might have been an opportunity missed
    there, yes. Thank you very much.
        I yield whatever little time I don't have left back.
        Ms. Ros-Lehtinen. Thank you very much, Mr. Donovan.
        And we now go to Congressman Chris Smith of New Jersey,
    chairman of the Subcommittee on Africa, Global Health, Global
    Human Rights, and International Organizations.
        Mr. Smith. Thank you very much, Madam Chair. And I do want
    to thank Ed Royce and Eliot Engel for calling this important
    hearing.
        Ambassador, it is so great to see you again. And welcome to
    our other very distinguished witnesses.
        Just a couple of points because so much has already been
    said. And I got here very late to ask my questions. But I would
    like to comment on the shift. And maybe you might want to
    comment on it as well.
        I have written two laws on microcredit financing, targeting
    the poorest of the poor, reauthorizing the funding. But that
    has changed dramatically and radically, as you know better than
    anyone else. Where we used to rely on donor support, obviously,
    and you have all testified to this, USAID says that more than
    half of the financing provided by microfinancing institutions
    now comes from deposits, as you know so well, with much of the
    remaining from private capital.
        And, again, I think my good friend from Staten Island made
    a very good point. What can we do to accelerate that or to keep
    that trajectory so that more people are reached?
        CARE points out that women still lag behind men in access
    to financial services by 7 percent worldwide, 9 percent in
    developing countries. So that disparity and gap must be closed,
    I would note.
        And your points about cell phones were excellent. You all
    made very good points about that. When we were going and doing
    our part to try to resource the Ebola crisis, one of the
    biggest takeaways was how cell phones were the bridge between
    best practices, including what do you do if somebody passes?
    Don't touch the body. That was all being sent out via cell
    phones. Radio was there. Cell phones were the dominant medium,
    if you will, that were used there.
        Financial inclusion, obviously that is extremely important
    as a driver. You might want to speak to that.
        And finally, today, in about 2 hours, the Frederick
    Douglass Trafficking Victims Prevention and Protection
    Reauthorization Act, a bill that I have introduced, joined by
    my good friend and colleague Karen Bass, Ileana Ros-Lehtinen,
    Chairman Royce, Ms. Frankel, and others, will be on the floor.
        And we have new language in this. Besides reauthorizing the
    TVPA of 2000, 2005, the International Megan's Law, and the
    William Wilberforce Act, to the tune of $534 million over 4
    years, it will do a number these best practices of training
    procurement officers, so that they know what to look for in
    trafficking.
        And you might speak in a parallel way, because I think
    poverty is still one of the major drivers behind trafficking,
    how we might also get procurement officers and others, because
    we buy an awful lot in this country, to be more aware of how
    they could be helpful in this important and noble battle as
    well.
        Ambassador.
        Ambassador Verveer. Well, thank you, Congressman Smith. It
    is always good to see you. And thank you for your leadership on
    so many issues we mutually care about, whether it is son
    preference or human trafficking.
        On the trafficking piece, I think the supply chain is a
    really important issue, and it has been manifested in other
    ways. But the work that is being done to understand where
    slavery is injecting itself and what end products have utilized
    and tapped that in terms of undermining people's human rights I
    think is a very important piece.
        And as you have so well stated, trafficking would not be
    the multibillion-dollar criminal industry it is today if people
    had economic viability. Traffickers prey on people who are
    desperate to come out of the straits that they are in, and they
    are coerced and conned, and we know what happens.
        So I think this is a very important piece. You have been on
    this issue a long time. This is another critical element as far
    as I understand.
        And, quickly, on the cell phones, we have talked a lot
    about the financial transaction side of it. But your point
    about Ebola is one point I don't want us to miss, which is the
    critical information, health information, inventory information
    on product lines, how to move them, information for women to
    protect themselves from violence, a lot of that is happening
    through the cell phone today. That is why it has become such a
    critical tool, particularly for poor women.
        Mr. Smith. Thank you.
        Ms. Suri. I will just add on the cell phones. I think
    Ambassador Verveer is absolutely right. There is lots of
    evidence that people are able to manage also their health lives
    better with cell phones. You can remind them to take medication
    that has to be taken continuously, and they do, and they
    respond to it.
        In all sorts of ways cell phones are such a big part of
    people's lives in the developing world that they really weren't
    here at the same sort of level of development in any way.
        And I think they are critical not just to that, but also we
    did a bunch of work on the Ebola crisis when it was happening
    in Sierra Leone and we wanted to track the economic effects it
    was having and whether women were pulling away from health
    services because they were worried about catching Ebola. And we
    did all of that data collection by cell phones, because we had
    been working in Sierra Leone for several years, we had people's
    phone numbers. And we ended up being able to trace out,
    literally every month we were running a quick survey of a few
    thousand people in Sierra Leone to track what was happening and
    how they were responding.
        And so I think not just in terms of good for people, but in
    terms of also being able to understand crisis situations, they
    have been very useful.
        Mr. Smith. Thank you so very much.
        Ms. Ros-Lehtinen. Thank you so much.
        And now we turn to Ambassador Wagner of Missouri.
        Mrs. Wagner. Thank you, Madam Chairman, for hosting such an
    excellent hearing.
        As a woman on both the Financial Services and the Foreign
    Affairs Committees, I am highly concerned about women's
    economic empowerment. And I very much appreciate your
    testimonies. Far too many of the world's women live in the cash
    economy without access to financial markets and services.
        Dr. Suri, I had a chance to read some of your work on
    financial services innovations that improve financial
    inclusion. I was particularly interested in your National
    Bureau of Economic Research paper published last fall which
    cited the importance of equipping commercial savings products
    with features that guide clients toward better financial
    planning, from text messages that remind people to save to
    automatic withdrawal of savings from paychecks.
        Tell me, how can the private sector, Dr. Suri, in
    developing countries improve how the poor are saving?
        Ms. Suri. Thank you for that question, Congresswoman. It is
    a great question.
        I think the private sector is starting to innovate a little
    around financial tools, but they are worried about risk. The
    financial systems are small, not that concrete, not that
    stable. And so I think they are worried about risk. So they do
    experiment a little, like with savings accounts, as you saw
    from our work.
        But I think encouraging them to provide a variety of
    products. I think what we have learned from microfinance is one
    hat doesn't fit all. I don't walk into the bank and there is
    one savings product and one credit product. There has to be a
    variety that meets different types of people's needs. And so I
    think trying to encourage the private sector to innovate around
    the types of products is one.
        And then we have talked about this bit before, is kind of
    helping them deal with that risk a little. If they are really
    worried about risk, can we derisk some of the things they are
    doing so that they are less worried and can invest and innovate
    more?
        And then, I think also doing the research piece around what
    works and what doesn't work. You know, that piece is really
    about, how do we think about what works in the financial tool
    set for people in developing countries? And I think we need
    that knowledge to be able to then go to the private sector and
    say, look, this didn't work, don't do it, the same way we were
    talking about earlier here. We can bring knowledge even to the
    private sector to show them what is working and what is not
    working.
        Mrs. Wagner. Thank you. I appreciate that.
        Ms. Iskenderian, I appreciate your leadership at Women's
    World Banking. I had the opportunity to look at your
    partnership to create Jordan's first health microinsurance
    product to directly address hospitalization costs. I learned
    that many existing health microinsurance products in Jordan
    exclude pregnancy and prenatal care.
        Do you find that this is the case in many parts of the
    world? And how can policymakers encourage the launch of
    microinsurance products that better support pregnancy care?
        Ms. Iskenderian. Thank you, Ambassador.
        That was not just a factor we see in Jordan, I am afraid,
    but in many countries. Insurance companies don't want to insure
    a risk that they know is going to actually happen. When a woman
    gets pregnant, we know what the outcome of that is going to be.
    So we, unfortunately, have found in many cases that that is an
    exclusion.
        Part of the reason why this product has been so successful
    in Jordan, and we have now replicated it in six other
    countries, is that we do not exclude maternal care. We found
    that that is the one time in a woman's life that she will
    prioritize her own health over her children's or her spouse's
    or other family member's. And so it is both a good sales
    technique in the way that you can convince a woman to take on
    that insurance if she sees it meeting a need that she
    expresses.
        It was interesting, in Jordan, we even saw women who were
    sort of outside child-bearing age find that that organization,
    the organization offering the insurance, if they had identified
    that need and recognized that as something that should be
    insured----
        Mrs. Wagner. So do you see those markets opening up at all,
    Ms. Iskenderian, I mean, in terms of maternity and prenatal
    care, and more across the world you are seeing it happen?
        Ms. Iskenderian. We are. Microinsurance is just still a
    drop in the bucket in terms of what is needed. Again,
    technology is really very helpful because we are bringing the
    cost of those very small policies down. But I think there is a
    recognition and there has been quite a bit of research, women
    do buy more insurance around the world than men. If you are
    going to appeal to women you have to meet their needs, and
    maternal healthcare is right at the top of that.
        Mrs. Wagner. I think it is. And whatever we can do as a
    country and a society to make sure that we are encouraging
    policymakers to make that more readily available across the
    world I think is very, very important.
        I believe, Madam Chairman, that I have run out of time.
        I have a wonderful question for you, Ambassador Verveer,
    but I will have to submit it in writing.
        So I yield back. Oh, Mr. Chairman. I am sorry.
        Chairman Royce [presiding]. Thank you, Congresswoman.
        Well, let me thank former Ambassador Wagner, but also thank
    every member here of the panel for taking time out of your very
    busy schedules to come here today to testify on this subject,
    because I think this is going to be very helpful to the
    committee as we continue our work to try to accelerate economic
    growth in these societies and promote global health and
    stability by focusing on this issue, by focusing on ensuring
    that the women who serve as the backbone of stable societies
    are not left behind and have the tools necessary to further
    progress in this area.
        So thank you all very much for your work in this area and
    your testimony.
        Ambassador Verveer. Thank you.
        Chairman Royce. And we stand adjourned.
        [Whereupon, at 12:04 p.m., the committee was adjourned.]

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