Career Dynamics and Gender Gaps Among Employees in the Microfinance Sector

Abstract

Microfinance institutions (MFIs) are commonly identified as empowering women and making them key actors in generating social change and economic development. Yet little is known about the gender parity among employees within the lending institutions themselves and how this can impact development. While MFIs are increasingly important as employers in the developing world, there is little micro-level evidence about gender differences among MFI employees and MFIs’ relation to economic development. We use a unique panel dataset of employees from Latin America’s largest MFI to show that gender gaps favouring men for promotion exist primarily in the sales division, while there is a significant gender wage gap in the administrative division. Among loan officers in the sales division, the gender gap in promotion and wages reverses. Finally, female employees tend to work with clients with better loan terms and a history of loans with the institution.