The foundational aim of the fintech industry is solving complex challenges left unaddressed by traditional institutions, but it has yet to solve the challenge of female representation. According to a Cambridge study last year, women account for just 7.69% of co-founders and 18.2% of executive committee members in fintech companies.
The theme of this year’s International Women’s Day is “Accelerate Action”. Simply put, it stresses the importance of tangible steps to create real change. Fintechs that prioritise diversity, including gender diversity, will outperform their competitors and build better financial products.
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Creating an inclusive culture
Many fintechs first focus on staff training while attempting to create a more inclusive workforce. This is an important piece of the puzzle, but it is crucial to recognise that training alone is insufficient for instilling effective diversity and inclusion practices across an organisation.
Instead, fintechs must also foster a culture that deeply values a diverse workforce.
This cultural shift must be enacted at all levels of an organisation, employing proactive recruitment strategies to attract diverse talent and ensure fair hiring practices. However, building an inclusive culture is not a one-time endeavour; fintechs must also create regular means for conversations about their working environment, and use staff training as a catalyst for discussion.
Moreover, building a flexible working environment enables females at all levels to engage and progress in their careers. From hybrid working to employment mobility, encouraging the sector to be a more adaptable workplace focused on outcomes rather than set routines will improve female representation and foster career progression.
Inclusive cultures not only instil a sense of value and security among all employees but also drive collaboration and innovation. Ultimately, building a working environment that is accessible to all demographics and understanding of individual differences leads to higher retention rates and better business outcomes.
Diversity as a business strategy
Formulating grand strategies surrounding diverse hiring is already starting from the wrong perspective. Instead, treating it as a core business strategy central to driving innovation and enhancing competitiveness not only ensures sincerity among management but also allows companies to take full advantage of the benefits of a diverse workforce.
Fintechs and the institutions they collaborate with, by their very nature, have to serve a broad range of customers. Just considering scale, the unique needs and perspectives of any firm’s customer base will not be adequately evaluated with a mainly homogenous workforce. If end users are women, female input must be included across all facets of financial services, otherwise, fintechs may provide financial services that have been designed and delivered by men, for men.
Female representation in every rank, from senior management to development teams, is an important first step to ensuring that all possible perspectives are considered during product development. In addition, women have unique requirements for financial products and services, including lower risk tolerances and a preference for convenient and clear applications. These requirements are most effectively addressed when they are included in the design and development processes. This is the case whether it be payment systems, digital wallets or budgeting tools; women have particular financial priorities and needs, and even their own intragender diversity.
Fintech and financial inclusion
Fintech’s leadership in furthering corporate social responsibility in finance brings with it increased opportunities for female representation. As fintechs popularise advanced yet sustainability-conscious technologies including digital wallets, virtual cards and emissions tracking, they are not only helping to protect the planet for future generations, but they are also creating more pathways for women to enter and lead in the sector.
The intersection of fintech and sustainability has proven to be an area where women routinely excel. A 2023 report by EY highlighted that while 43% of UK financial services boardrooms are female, this figure increases to 64% for board directors at financial firms that place a strong focus on sustainability. There is an alignment between women’s skill sets, particularly when it comes to collaboration, multi-stakeholder engagement and long-term planning, and roles focused on sustainability.
The high representation of women in sustainability-driven finance firms promotes even greater female representation across the fintech industry. An increased number of women at the helm of fintechs with a sustainability agenda encourages more women to enter the sector, realising that there is a path to the top; female leaders in sustainability-focused fintechs are paving the way for increased representation across the fintech industry.
Why ‘Action Now’?
Reflecting on IWD paints a clear picture: fintech has a financial and competitive imperative for immediate action. Increasing female representation at all levels is not simply the correct thing to do, it’s a cultural shift that will enable heightened innovation and improve relationships with customers.
The challenge this International Women’s Day, and indeed those to come, is to accelerate action and embrace the power of diverse perspectives for a brighter and more inclusive future across our industry.
Anna Porra is Chief Revenue Officer at Paymentology
