By Amy French on Monday 8 March 2021
We need collective action to ensure that the themes of gender and diversity aren’t sidelined, writes Level39 head Amy French.
Last week saw the publication of the long-awaited Kalifa review, setting out a roadmap for the future of fintech in the UK. Authored by ex-Worldpay boss Ron Kalifa, the paper was commissioned to enhance government policy aimed at securing the UK’s leading role in financial innovation and to accelerate investment in the sector. The pandemic has spurred an uptake in consumer and business fintech services, whilst the sector continues to attract record sums of investment—it couldn’t be a more important time then to evaluate Fintech’s short but impressive rise.
The review has been praised by many for recognising the importance of fintech in a post-pandemic economy, and the need for safeguarding measures that focus on skills, innovation and investment. The paper includes some promising and well-received recommendations, including a strong focus on UK regions, new training programmes to upskill the workforce and reducing red tape for high-growth companies.
What the review presents is an opportunity to take a fresh approach to the future of finance—and in addition to its forward-facing proposals, that should mean looking closely at gender representation throughout the sector with real determination to sponsor change.
It is no secret that women have been underrepresented in banking consistently and whilst fintech has the opportunity to transform the world of financial services, to date, many of the same mistakes are being made when it comes to diversity. Shockingly, according to research by Oliver Wyman, women make up less than 30 per cent of the workforce in fintech, and hold only 13 per cent of executive roles, far less than the banking sector, which reached (a still low) 23 per cent in 2019.
These figures are particularly concerning in light of a recent review by the Women and Inequalities Committee, which reported that women in business are likely to be most negatively impacted by the current economic climate, suggesting these stark discrepancies will only increase further if action is not taken. With this in mind, if now is a moment to plot the future of fintech post-covid and after Brexit, fixing the under-representation of women at every level must be a major priority throughout the industry.
Diversity within fintech is not only essential from an ethical standpoint, it also improves innovation. It is fundamental that women are at the table when critical decisions are being made about the development of new technologies that will impact them and their exclusion from these discussions risks gender inequality becoming embedded.
A lack of representation at board level also means that there is a substantial unmet opportunity for increased revenue - companies are less able to serve the needs of female customers. A study by Credit Suisse found that firms with at least one woman on their board performed 26% better than those with exclusively men. This highlights the potential of fintech when gender inclusivity is a priority, and how this will benefit the sector as a whole.
Despite the economic climate, vacancy levels in the digital economy are rising—upping female representation is both a solution for fixing talent shortages and addressing inequalities. In achieving this we will need to tackle head-on the factors that contribute to the gender gap. For example, a recent survey of the FinTech sector from InChorus, revealed that 85% of workplace harassment was related to gender, providing a damning insight into why women would be deterred from taking, and succeeding in, roles within fintech. As such, we have to demand more of companies take accountability for facilitating these hostile working environments and in turn reap the benefits of having a more diverse workforce.
The Kalifa report sets out new training programmes and skills initiatives—if we collectively act now, more women can use this moment as a springboard into fintech, utilising the necessary training and resources to contribute to this rapidly expanding industry. This, along with the continuation of programmes encouraging school-aged girls to study STEM subjects, will help to increase the number of women in technology roles, as a win, win.
The nascent nature of fintech means that there is a golden opportunity to refocus and abandon inequalities that have persisted in banking. Only in doing this, will the UK truly realise all the potential outlined in the Kalifa Review—benefitting from a thriving fintech sector that is modern, progressive and internationally competitive.