Diversity in US FinTech Companies
It’s no surprise that the FinTech industry is constantly evolving every day. As the space evolves, the leaders that dominate it are also changing. With this has come a lack of gender bias within the industry, allowing for new creative ideas to diversify how we view financial services. Diversity has enhanced the FinTech space for communities who have historically had difficulties with financial services.
The changes we’ve seen from both FinTech products and leaders have made it possible for most anybody to get the financial stability they deserve.
Why Diversity in FinTech is Important
As we say in our Women in FinTech article, FinTechs with diverse leadership not only instills innovation and new perspectives within a culture, but have seen benefits in growth and funding. Diversity in leadership can also help a company to:
- Increase awareness
- Attract and retain top talent
- Maximize learning and transformation
- Have better customer and employee relationships
- Give more authentic representation
Where have we seen barriers?
Some features of fintech tools also serve as barriers to populations. Fees were a major barrier, with a larger percentage of Black people (47%) responding that there were too many fees associated with creating a savings habit compared with white (13%), Asian (10%), and Hispanic (13%) people.
A greater percentage of people making less than $50,000 (37%) said there were too many fees associated with investing tools than those making $50,000 to $100,000 (14%)–consistent with data that indicates lower-income families pay more in fees. This difference holds for tools for building an emergency fund (30% vs. 13%) and basic banking services (23% vs. 15%).
Fees in Loans
Fees serve as a barrier for other fintech tools as well. For example, 23% of females said there were too many fees associated with paying off student/personal loans as compared with males (6%). Fees for securing or refinancing a loan were problematic for more Black people (50%) than white (22%), Asian (14%) or Hispanic (8%) people.
This data indicates a significant opportunity for the fintech industry to improve upon the lack of trust in financial services, often because of negative past experiences with traditional financial institutions. Consumer perception is complex and reaching financial goals often requires instilling trust and confidence in a product. In light of the increased usage of fintech applications due to the pandemic, fintech and financial services have an opportunity to examine perceptions and product design and develop solutions that build relationships and trust.
In a new study from Commonwealth examining the use of conversational AI by low- and moderate-income people, between 20% and 35% of respondents used apps to manage expenses, pay off debt, build savings or invest. Aligning the design of fintech tools with the needs of these population segments could create a systemic shift to enable financial security.
Financial insecurity is a major issue in the U.S., with tens of millions of people living with inadequate savings and no meaningful wealth. Wealth creation — not just current income — fosters economic security and launches social mobility. An accelerated uptake in fintech usage during the pandemic offers a significant opportunity to drive change for financially vulnerable populations, disproportionately Black, Latinx and female-led households, while presenting an untapped customer base for financial services and fintechs.
Top Diverse US FinTech’s
Here are some of the companies with diverse leadership we’re looking out for!
On a mission to get every family in America saving, Goalsetter is a goal-based savings and gifting platform made for kids. The company has become the first savings vehicle for kids, trying to turn first-time savers into all-the-time savers by giving them sustainable financial habits. Once a Nickelodeon executive, CEO Tanya Van Court believes that every family in America deserves the shot at the American Dream.
Climb credit is on a mission to expand access to career-advancing education. Making career connection and transformation more accessible, affordable, and accountable ever before, the company is targeted towards the provision of financing options and give all students equal opportunities. Led by CEO Casey Powers, the company has seen recognized the dynamic and diverse nature of an economy in rapid change and are looking towards the future of students.
Esusu has made it their mission to dismantle barriers to housing and working families. Founded by Abbey Wemimo and Samir Goel, Esusu was built to include everyone on the journey from financial identity and stability toward financial wellness that leads to wealth building. Being the leading financial financial technology platform, Esusu is at the forefront of paving a permanent bridge to financial access by providing financial solutions for low-to-middle income consumers.
CapWay knows that banking is changing heavily – creating financial access and opportunities for everyone. Founder and CEO Sheena Allen was looking to “build a full ecosystem for people who have been left on the outside of traditional banking.” Millennials and Gen Z have grown up in a social and tech world, and CapWay has combined social content with technology to better relate to the next financial generations.
On a mission to make financial resources accessible to undeserved business owners everywhere, EnrichHER is a FinTech platform that matches revenue-generating companies to individual and institutional sources of funding. Led by CEO Dr. Roshawnna Novellus, EnrichHER is re-imagining the face of business ownership by putting capital in the hands of women and founders of color.
MoCaFi is helping communities spend smart, build credit, and live wealthy. They are a financial services platform for the 110 million Americans dealing with economic hardship and no path to a better circumstance. CEO Wole Coaxum is leading MoCaFi to serve 50M US population of unbanked & underbanked.
With the belief that every small business deserves fair, responsible access to capital, Lendistry was designed to help the small businesses grow. Being one of the top ten Paycheck Protection Program lenders of 2021, the company is providing economic opportunities for underserved communities as a source of financing and financial education. With over 20 years of banking experience, CEO Everett K Sands is looking to change the game for the underserved communities.
Diversity in Recruitment
The promotion of diversity and inclusion in a FinTech atmosphere is imperative for the future of the industry. All these companies are instilling new changes and immense progress in the world of FinTech. Diversity in FinTech leadership positions incubates innovation, increases productivity, and grows profitability. This enables companies to find and maintain top talent in their industry. As the industry grows, we’re expecting to see the growth of FinTech companies and their solutions for diverse communities.
Your Partner in Growth
As the FinTech industry continues to grow, so does the need for talent to facilitate this. At Storm2 we’re dedicated to implementing diversity in our culture. This has helped us to continue to diversify our teams of clients for best performance. We specialize in connecting FinTech talent with disruptive FinTech players such as yourself. We can assist in any stage of your growth by connecting you with the right people. Please don’t hesitate to get in touch and we would be more than happy to see how we can help and support you in your journey.
If you are looking to scale your FinTech to be more inclusive, get in touch. Our specialist Consultants have a network of diverse professionals to fit you with the right talent.