Every year on the 8th of March, the world celebrates ‘International Women’s Day’. In the fintech world, much progress has been made in encouraging women into fintech. But claims of diversity and inclusion ring hollow when data shows that the industry still needs to do much more if it is to live up to this year’s UN Women’s theme of “DigitALL: Innovation and Technology for Gender Equality”.
Of course, this problem is not limited to the fintech industry. But for such an outwardly progressive sector, overall female representation remains staggeringly low, from the ground up to the leadership level.
State of UK workforce
Despite representing 52.7% of the overall UK workforce, women held just 5% of CEO positions and had 21% of board seats globally inside financial services firms, according to Deloitte data. Across Europe, research from the Financial Times and Sifted finds that women hold 28% of executive team positions at Europe’s challenger banks. But that’s still less than the global average of 31% across all industries, according to data from consultancy Grant Thornton – a stark reminder of the gender imbalance that blights the industry.
Stubborn barriers still to overcome from the bottom to the top
All too often, it starts at ground level. For a long time, many companies lacked the foresight to have formalised diversity and inclusion policies and subsequently lost out on hiring the ideal talent for open roles. Nowadays, it’s much more common for companies to put their diversity initiatives front and centre because they realise that without a clear and public commitment, many women will be deterred from applying and will seek out those organisations that actively encourage women into the workforce.
At the other end of the hierarchy, the lack of women in senior positions could actually damage a company’s bottom line. A headline figure comes from consultancy McKinsey, which found that organisations with more than 30% of females in executive positions were more likely to financially outperform those with a percentage between 10% and 30%. Meanwhile, those companies with higher numbers of women in senior management achieved a 41% greater return on equity.
If fintechs want to deliver on their widely-held brief of improving financial inclusion, they must start representing the societies they serve. And the world of work today looks very different to how it was just a few years ago. With the sudden arrival of the pandemic, working from home became the norm overnight. Although more and more people are returning to their physical workplaces, the office-based 9-to-5 model has given way to hybrid working and more flexible hours.
Established in 2016, Enfuce is one of the few female-founded fintechs and is even rarer in that it was co-founded by two women, Monika Liikamaa and Denise Johansson, who serve as co-CEOs. According to Monika: “Denise and I are both mothers, and we know how important it is to create opportunities and a flexible work environment for working parents. That includes maternity and paternity leave policies, condensed working hours over shorter working weeks, and other practical steps to help employees balance childcare needs with their work activities.”
The importance of mentorship networks for women
According to Terrie Smith, Co-Founder and Global Ambassador of wearable tech leader DIGISEQ, it’s crucial that female leaders in fintech pass on the lessons they’ve learned, the challenges they’ve faced, and the successes they’ve achieved to the women around them.
“Women who have battled through discrimination earlier in their careers, or have been blindsided by colleagues, can be invaluable sources of wisdom to others looking to avoid career pitfalls,” she says.
“Mentorship networks can be vital in giving women in fintech the courage to stand up and speak out – from asking for pay parity with their male peers, rooting out inefficient processes, to putting forward new ideas for services.”
Monika adds: “Have the courage to ask for help or change when needed. I always ask myself, ‘what’s the worst thing that can happen?’ Usually, it is just that someone will tell you no. It has always amazed me how afraid people are of hearing ‘no’ or, for that matter, asking for help. When you recognise that someone needs help, chances are you will do what you can to help them.”
DititALL + financial inclusion = success
From a business perspective, having more women in fintech can positively impact the whole ecosystem of payments, enabling more change and innovation.
According to Monika, there is a need for more female input in product design: “A good example is seat belts – clearly designed by a man who has never been pregnant! They are not fit for purpose as they are uncomfortable and impractical for women’s bodies. Formula 1 cars don’t have the same types of seatbelts because their purpose is different, so why are standard seatbelts not fit for 50% of the population? Be part of the process!”
Whether it’s tackling financial exclusion amongst underbanked populations or female-centric product design, many of the problems fintech is trying to solve are too big for one person or company to do, so it is important to collaborate as much as possible. And when half of the world’s population is female, understanding their needs will be crucial to the future success of fintech.