Recently I had the opportunity to share my experiences with a group of women in the finance field. To complete my talk, it required that I do some research on the field and get more information specifically about FinTech. The world of technology for financial and banking institutions, or FinTech, is on an amazing growth path. What makes this boom so amazing is not just the wealth of opportunities presented, but the possibilities of leveling the playing field in the finance industry and providing access to a vastly underrepresented group – women.
FinTech combines finance and technology, two industries that tend to be very male-dominated. In both those fields, women are typically found in marketing, business development, sales and human resources while men are more evident in programming and leadership. Even in the entrepreneurial realm of FinTech, the number of women startups is consistently well below 20%.
There Is Progress, But Not Enough
There are programs that are helping women become more active in financial investments. Organizations like Girls Who Invest are opening the doors of Wall Street to women by transforming the asset management industry and bringing them into portfolio management and leadership. The organization’s goals, as represented on their website, are 30 by 30: to have 30% of the worlds investable capital managed by women by 2030.
Technological breakthroughs and online investing have also been moving women in to FinTech. New financial management software packages are giving better and more open access for women to play an active role in the investment field.
Women, in general, are doing better as business owners. According to the American Express sponsored report, The 2018 State of Women-Owned Businesses , the growth rate of women-owned business has been phenomenal. “The number of women-owned businesses increased a dramatic 31 times between 1972 and 2018, rising from 402,000 (4.6% of all firms) in 1972 to 12.3 million (40% of all firms) in 2018. Employment surged from 230,000 to 9.2 million, growing 40-fold. Revenues rose from $8.1 billion (representing 0.3% of all firms revenue) in 1972 to $1.8 trillion (4.3% of total firms revenue) in 2018 — a breathtaking multiple of 217.”
This is great progress for women-owned business, but not necessarily for women in FinTech. The report also says, “the proportion of firms in the professional/scientific/technical services category shrank from 14% to 12%. These businesses generated less average revenue than women-owned businesses generally.”
That only refers to women business owners. When you start adding in additional statistics from women in management and executive positions, you see things are still out of balance.
• Only 29% of working women are represented in the FinTech space.
• The percentage of women executives in FinTech is only 8% worldwide, as compared with 22% of the major banks.
• Women account for just 15% of all listed inventors behind 9 million patent applications across 182 countries.
• Only 54% of women have access to senior level mentors.
• Just about 20% of medium and large firm managers worldwide and only 2% of bank CEOs are women. Interesting findings, given the fact that women account for more than half of the consumer base all the FinTech products and services aim to reach.
NextGen Women Need Encourgement
The progress women have made in general, and in FinTech specifically, have grown slowly, but it has continued to grow. However, trouble looms ahead when we look to the next generation of women to continue the progress in the technology industry.
According to many reports, generally 40% of the women in the US workforce are not interested in computer science or Information Technology (IT) as a career. Looking at students today, only 20% of the high school Computer Science Advanced Placement (AP) exams have been taken by women. Female students majoring in computing in college has fallen off dramatically in the past 35 years. In 1984, 37% of computer science majors were women. Today that number is only 18%. How will the fight for balance in the tech and FinTech fields continue?
When we look at the lowering numbers of women in FinTech, we can see several factors that affect them and discourage them from trying for advancement or entrepreneurship.
• Although it may seem a dated idea, women have traditionally been left out of financial matters because of their limited exposure to the financial world. They have had fewer opportunities to learn and expand their knowledge.
• Women are more likely to be part-time entrepreneurs as a way of supplementing their income while providing the flexibility they need for care giving responsibilities.
• It can be difficult to maintain the pace of learning trends and technologies after returning from maternity or other leave. So women might settle for something less, feeling they can’t keep up the pace.
• A lack of female mentors, role models, or self-confidence can deter career advancement.
Many of these are the same reasons women struggle with gaining the recognition and development they strive for in all fields.
Where Do We Go From Here
When it comes down to it, it doesn’t matter if a woman is taking a step into opening a company, asking for a raise, or diving into the field of Financial Technology. The key is for all of us to get to a place where gender is neither a detriment nor a benefit. This requires new strategies and thinking for everyone, including females who are seeking funding for new projects or businesses. We have to go outside that comfort zone to bridge that gap.
Girls and women need to be encouraged to take the risk; they need to be supported in their tech careers and foray into entrepreneurship. Girls need to be shown that computer science and tech are interesting, fun, creative, and flexible. It’s a field that’s applicable to any other interests. Programs like STEM reach young girls and show them that math and science are cool and exciting.
This encouragement and enthusiasm needs to continue through junior high and high school, into college and beyond. Women in the field should volunteer their time to mentor girls and women. By sharing their advice and insight, they are showing how FinTech is a vital, prosperous, and interesting career path.
There is no denying that women have played and will continue to play a critical role in the future of FinTech. The true key to cultivating a more inclusive industry is the responsibility of both genders.
“Diversity is an essential ingredient to innovation.”
Think beyond gender and encourage companies to recognize there is a definite business benefit to including diverse points of view in the decision-making process. By continuing to build an inclusive, diverse, and accepting field, the FinTech Boom will continue to blast away the stereotypes.