Fintech is about progress. As a concept, it represents the modernization of an old and outdated industry – making services faster, simpler and easier to use.
We often hear about fintech growing at such and such rates, with new companies constantly emerging that “revolutionize” the way we shop, spend, save, bank, pay, etc. It is a disrupted industry; Which insists not only on new ways of working, but on new ways of thinking.
However, for all its forward-thinking and futuristic checking, fintech struggles when it comes to diversity and inclusion. Less than 30% of the UK’s FinTech workforce are women. 17% of top positions are held by women and only 5% of founders are women.
In an article published earlier this year, Deloitte also noted that early adopters of fintech services are predominantly male. Data is limited, but it shows a picture of an industry that is mostly run by men.
When it comes to racial diversity, the industry is mostly white. Only 1% of European startup founders are black business owners, and BAME business owners find it more difficult to get funding than their white counterparts.
The fintech industry is reaching a point where it needs to ask itself what it stands for. Does building a progressive and innovative approach to finance mean that ex-bankers wear jeans to work? Or are we ready to address this shortcoming in our sector by working?
I think it’s time for positive change, but we need to re-evaluate some of the points that are being made.
It’s time to move on with the conversation
When trying to understand this lack of diversity, fintech leaders will make the same argument: “We would like to increase diversity across the organization, but we don’t take in nearly as many females, non-white, LGBTQ+ or applicants with different abilities. Our hiring reflects the talent pool that has to be We have to choose between them.”
We have to break this feedback loop. If we appreciate what diversity can bring to business (which we should, considering that many studies have shown that diverse companies perform better than less diverse companies), we need to do more.
The good news is that changes in the world of work act as a catalyst. The more flexible approach to work that many companies have taken, caused by the pandemic, comes with many advantages – a more diverse pool of talent to be hired than being a prime example.
Flexible work can help parents return to work and expand new opportunities for talented individuals living in different regions. It is not a complete solution to the problem of diversity, but a starting point for a better approach to hiring.
What can he do?
Fintech experienced record growth in 2021. With the rise of embedded finance and the Bank of England exploring the idea of digital currencies, financial services are still in the early days of massive change in the industry.
If we’re going to build diverse teams, the most impactful changes we can make are within our companies. Having a flexible work policy clearly defined to support your team’s needs and asking for ideas on making things more inclusive goes a long way.
Anonymous forums where people can share ideas and give feedback are also helpful, and it’s important to make sure companies communicate how they work with job applicants before they join.
The main approach comes from involving people in finding solutions. As leaders, we don’t have to have all the answers – our employees are often the greatest source of feedback and ideas. Diverse and inclusive environments promote diverse ideas.
Another approach to consider is internal coaching and mentoring programs for underrepresented people. If we collectively prepare these groups for more senior positions, we will see the results over time. And with more applicants filling these top positions, it would be impossible to say that the pool of talent to choose from is so small.
Finally, we can learn from companies that put integration directly into their product design. Finance is used to serve people by geographic area, and now it has started to serve people by community. The more directly we communicate with underserved communities, the better our approaches will be.
I think the diversity within fintech is getting better every day. We just need to work a little faster – something that fintech has always been good at.
Different approaches will be better suited to different businesses – and most importantly, focus now leads to action. If we can do this, the fintech sector will continue to grow and be better prepared for future challenges.