The Challenge

Despite major advances in financial inclusion globally, many women remain excluded from higher-return economic opportunities that exist in male-dominated sectors. In Pakistan, unsafe transportation and restrictive gender norms limit women’s mobility and ability to work outside the home, contributing to low female labor force participation.¹ As a result, women are concentrated in low-growth, home-based activities, even when profitable opportunities exist in sectors such as transportation. Entering this male-dominated sector typically requires asset ownership and the ability to manage income volatility—conditions that existing systems rarely support for women. Moreover, as women also face limited access to collateral, weaker control over assets within households, and, for some, religious objections to interest-bearing loans, making traditional microfinance challenging to improve livelihoods.

Equity-like financing products offer a promising alternative by providing better risk-sharing than standard fixed-repayment debt contracts. By tying repayments to actual usage or income, these products reduce the financial burden during low-income periods²—particularly valuable for risk-averse women undertaking high-reward investments that take time to yield returns. These models are especially useful in Pakistan, where they can reach millions of financially excluded Muslim women seeking non-interest-based contracts, potentially enabling them to make productive investments that generate meaningful income.

The Evaluation

In collaboration with the National Rural Support Programme and the Rural Community Development Programmes, researchers are conducting a randomized evaluation in Lahore, Pakistan to measure whether innovative asset financing products can enable women to enter the male-dominated transport sector and improve their income, mobility, and household bargaining power.

Researchers will provide women with financing for high-quality rickshaws equipped with safety features, including GPS tracking, quick-response alert buttons, and customer identification through the inDrive ride-hailing app. A total of 1,000 women eligible for enterprise loans from partner microfinance institutions have been randomly assigned to the following groups:

• Standard debt-based contract (300 women): Participants receive financing for a rickshaw (approximately USD 1,720) through a fixed monthly repayment plan over 24 months, with an initial 10 percent down payment.
• Performance-linked contract (300 women): Similar total nominal payments to the debt contract, but half of the fixed repayments are replaced with performance-linked payments based on monthly mileage measured by GPS data. This offers flexible contract duration and implicit insurance for drivers.
• Comparison (400 women): Participants are offered a standard business loan product (typically up to USD 475).

Researchers will measure impacts on household income, self-employment, hours worked, female mobility, decision-making power within households, and men's gender norms.

Results

Results will be available in 2027.

Sources

^1. International Growth Center, “What prevents women’s labour force participation in Pakistan?” International Growth Center, March 11, 2024, https://www.theigc.org/blogs/gender-equality/what-prevents-womens-labour-force-participation-pakistan

^2. Abebe, Girum, Rachel Cassidy, and Toni Weis. "Access to Capital and Women’s Entrepreneurship." Policy Research Working Paper 11232 (2025).

Implementing Partners