In recent years, we have seen the emergence of fintech products specifically targeted at underrepresented groups.
Daylight is an American neobank created for the LGBTI+ community, 53% of whom regularly try to save money. Despite an estimated $1 trillion purchasing power for most Americans, this is another American neobank created and designed for immigrants to help resolve related conflicts. us With accounts in the EU and the UK, Moniz, Emerald Life and Waheed are examples of fintech companies targeting underrepresented groups.
The same is true for fintech products for women. From insurance to financial and expense management, venture capitalists from both Europe and Silicon Valley are increasingly interested in offering exclusive financial products for women.
But what kind of women? necessary or even want Their own financial product? Shouldn’t money be approached with gender neutrality? As the co-founder of a financial education platform focused on financial empowerment for women and non-binary people, I have been asked these questions frequently.
This change can only happen when women are no longer seen as a “niche” audience, but are recognized as agents of change.
Now fintech is made for men
Looking at the current situation, fintech is an industry created by men for men. And while this may or may not be a conscious effort by management, it is undoubtedly a by-product of a systematic lack of diversity in the tech sector. Women make up just 30% of the fintech workforce, and if you’re in charge, the picture gets even worse. Only 1.1% of funding in 2021 went to women-led companies, according to Atomico, which is worse than in 2020. The numbers are much worse for companies led by black and Hispanic women.
This lack of variety ultimately affects the product. Any good tech company knows how user research can help improve and customize your product. But if your product is built for a live male experience, it will attract more male customers, and so – yes, you guessed it – your user experience data will also be biased.
A recent survey of women’s investment experience by investment management firm BNY Mellon found that nine out of 10 wealth managers (86%) say their default client is the person who is automatically targeted in product development and distribution. Similarly, three-quarters of wealth managers (73%) say their organizations’ investment products are predominantly male-centric, suggesting they focus on the benefits and characteristics typically associated with women.
With the current status quo, women are not seen as the only target audience. As Caroline Criado Perez writes in her book The Invisible Woman, “The result of this male-dominated culture is that the male experience, the male point of view, is considered universal, while the female experience is, after all, half the population. world is seen as a niche.
Do women need their own fintech products?
I have often been told—mostly from men, I should add—that money is not sex. This is a topic that affects all of us equally.
Unfortunately, this is far from the truth. Money depends on gender, as women and men perceive the world differently when they are depressed.
Sally Krawchek is the founder of Ellevest, an American investment platform for women. She identified six persistent pay gaps, including the gender gap in wages, credit, investment, financing, problems with unpaid work, and the “pink tax” (higher cost of women-targeted consumer goods). Simply put, women face different financial challenges than men, which is why we fall behind when it comes to finances.
There is also the theme of financial education and trust, best described in Starling’s “Make Equal Money” campaign, which notes a huge gap in the quality and breadth of financial information presented in the mainstream media. While 73% of financial items targeted at men are about investing, 90% of financial items targeted at women are focused on spending less. We receive very different information and messages about finance.
Unfortunately, the fintech industry consistently ignores the differences between the experiences, values, and motivations of men and women when it comes to finance. This results in a mismatch between women’s financial preferences (which may be more focused on long-term sustainability than short-term, risky financial gains) and a focus on financial services.
untapped market opportunities
If you are an asset manager or fintech, if you are not taking a proactive and informed approach to increasing women’s participation in investing, you are missing out on a huge market opportunity. The same BNY study found that if women invested at the same rate as men, there would be at least $3.22 trillion in privately managed assets today.
Apart from this, there is also a reason why women’s economic empowerment is one of the United Nations Sustainable Development Goals. Increasing women’s participation is good for the planet and society. Women are more likely to make investments with positive social and environmental impact, meaning that if women invest at the same rate as men, there will be an inflow of $1.87 trillion in additional capital for responsible investing.
This is not to say that the fintech community has not made an (often horrendous) effort to negotiate with women. But efforts are often based on old stereotypes or assumptions. These types of campaigns target women as a homogeneous group rather than a very diverse group of people with different needs, goals and spending habits. As part of what is labeled “women” in user data, you must also consider the unique experiences of non-binary people and ethnic minorities. Needless to say, we are a diverse group!
In 2021, Revolut made headlines by launching a campaign aimed at attracting a female audience by offering to cover the cost of menstrual care as part of a Premium Card membership. She has been criticized for the low key nature of the campaign, for failing to truly grasp the reality of women’s experiences with money. I don’t think this is surprising, because of the 11 members of Revolut’s senior management team, only two are women.
However, there is one area where gender marketing excels: credit. The opportunity for gender marketing has been seized by companies such as Buy Pay Later and Klarna, who have found great market success with their pastel pink logo and partnerships with brands such as H&M and ASOS. When will fintechs offering massive wealth seize market opportunities instead of shrinking them?
With the wealth generated by the proliferation of cryptocurrency-related financial opportunities, it is time for investors, founders, and fintech companies to prioritize building female-centric fintech and attracting female users. Otherwise, we risk widening the gender wealth gap for future generations. Coin Dance, which tracks and provides statistics on bitcoin users, regularly monitors the gender balance of the bitcoin community, noting that women make up less than 15% of investors.
The answer to the question of attracting women to invest cannot be found in the old tricks or pranks. Women must be the backbone of the company, and motivated teams must prioritize them to create financial products that truly reflect the unique needs and perspectives of women. Either way, it’s about connecting with this very diverse audience, understanding what motivates women to invest and what kind of communication they respond well to.
This change can only happen when women are no longer seen as a “niche” audience, but are recognized as agents of change. For this to happen, a significant structural and cultural shift is needed in every element of the fintech industry, from investment to user copy.
Practical steps to attract more women to fintech
- Make women part of your product, not just your marketing plan. Make sure women and marginalized people have an equal share of your user data. Actively seek out UX from female users and speak with female clients and potential clients from different ethnic and socioeconomic backgrounds.
- Check your product language and external communication. Is it gender related?
- Diversify your teams to expand your pool of possibilities. Your product is in part a reflection of your team. Make your OKR more inclusive for your team (not just marketing) as a priority.
- Be aware of financial opportunities. By not prioritizing female-focused fintech, you are missing out on a dysfunctional market with growing demand for financial products and purchasing power.
- Add more women to your venture capital team. The gender structure of investment decision makers has a significant impact on the distribution of investment capital. Pave the way for change.
- Give your suggestion. You have a lot of power as a consumer. If you notice gender-specific language, gender stereotypes, or a significant lack of diversity in your product, please contact support. In the world of customer-facing products, this matters a lot.
- Support leading fintech companies along the way. There are some great new platforms for retirement, investing and wealth management that prioritize inclusion. Try them.
I want to see money as fearless as I want the world to be colorless, but there are prejudices in our societies and institutions, unconsciously or not. Until that happens, we need more fintech products for women built by women.