Women and the Fintech Industry
Two Male-Dominated Industries with One Stone?
The clash of finance and technology in the FinTech sector has massive potential to create an abundance of well-paying jobs in the coming decades. However, this combined industry also runs the danger of following patterns established by the two sectors it is merging. The finance and tech sectors have some of the worst track records when it comes to gender pay equality. According to research published in February by PwC, women working in asset management, banks, and financial companies are paid an average of 34% less than their male counterparts. Similarly, information from PayScale shows that gender pay gap in the Tech Industry ranges between 19% and 32 % based on an individual’s role within a company. Essentially, both these industries have substantially higher gender pay gaps than the norm.
Does the FinTech sector show promise for reversing the trend in a better direction? If the danger is that this emerging industry will follow its predecessors, fears appear to be well founded. The Financial times reports that FinTech groups actually fall short of banks in gender equality. Globally, only 8% of FinTech company directors are women, compared to 22% in large banking firms.
Reasons Behind the Lag
Why is it that the innovation serving finance and technology seems to be failing change in women’s opportunity? Speaking to the Financial Times, George Hanias, head of communication and diversity programs at Innovate Finance, said,
There are three big challenges that are still impeding women’s ascent to the top of the FinTech sector: education, leadership, and money.
Education continues to be a root cause. Although girls continue to outperform boys in STEM subjects in public education, the tech industry has a poor reputation for promoting women’s capacity to succeed by promoting a culture that continues to be overwhelmingly dominated by male figures. In relation to leadership and promotion, finance and tech companies do little to foster family friendly top office positions, further reinforcing the glass ceiling for women.
The Way Forward
Steps are being taken to combat the factors contributing to gender pay inequality. Local and national governments are also beginning to enact legislation targeted at preventing gender discrimination, steps that women in the FinTech industry may benefit from if passed into law. The Financial Times reported that, as of mid-2017, UK companies with more than 250 staff would have to publish data on their gender pay gaps. This increased level of transparency can be seen to serve as an impetus for greater equality, as organizations of all sizes are aware if the reputational damage that can be caused by a public outing pay inequality. The California Pay Act of 2015 strengthened the ability of women in FinTech hubs, such as San Francisco, to sue their employers for pay discrimination. Under this law, substantially similar work has been defined as grounds for equal pay based on skill, effort, and responsibility.The aforementioned FinTech hub of San Francisco is also home to a range of workspace solutions, including female-centric coworking spaces and serviced offices available in various locations throughout the city, creating an abundance of opportunities for women of this sector to seek collaboration and often mentorship.
At an educational and cultural level, things are also beginning to move in the right direction. Female employees in STEM organizations are promoting opportunities to young women and girls in the tech field, a field in which female employment continues to inch forward in numbers. Additionally, role models raising awareness about female potential have also been key to promoting female potential and pay equality. Innovate Finance recently published its Women in FinTech 2019 Powerlist detailing success stories to promote female growth in the industry.
Such efforts underline the conviction that, although the FinTech sector will inherit many of the functions and services of its parent industries, it need not inherit their gender disparities. With increased focus on better education, greater awareness, and determination toward reshaping industry culture, gender disparities can narrow substantially.