Despite being strong savers and reliable customers, the women’s market remain largely underserved with only 65% of women benefiting from financial services, compared to 72% of men.
Though this gender gap represents a massive opportunity for fintech players, these are failing to tap into the market in a meaningful way, according to a new research by the Financial Alliance for Women.
This is primarily because fintechs tend to focus on growing their user base as quickly as possible to capture investor interest when starting out, the research said.
The reason for this is that men are perceived to be early technology adopters, these companies often begin to tailor their products to men. By the time fintechs are well-funded, they are already well on their way to being caught in a self-reinforcing spiral, the research found.
The report added that most fintechs lack women in key roles, leading to unconscious biases during the business modeling and product development processes. The Financial Alliance for Women, which polled 168 fintechs, 30 investors as well as other ecosystem actors from 43 countries, found that most fintechs’ product and tech teams are less than 25% female, and a majority have male-only founders.
While fintech remains a largely male-dominated sector, females-led fintechs are found to generate higher revenues than those without women in leadership positions.
Results of the Fintech Benchmarks Proof-of-Concept released in August 2020 reveal that among a sample of 45 fintechs, female-led ones had nearly three times the revenue per customer of non-female-led fintechs
The gender-gap is also visible in startup funding. According to a new study by Deloitte, startups founded by women still face more difficulties raising cash than do other firms.
Over the past five years, women-founded startups raised an average of 50% less capital than startups only by men, a disparity that could be in part driven by the gender bias of venture capitalists (VC) when making funding decisions, Deloitte says.
If provided with equal access to opportunity, women fintech entrepreneurs would likely unleash more successful new ideas by creating solutions based on their own disappointing or frustrating financial services experiences, the consulting firm says.
Developing holistic, gender-intelligent customer value propositions
In order to capitalize on the full business opportunity of the women’s market, fintech firms must prioritize the collection and analysis of sex-disaggregated data to design “gender-intelligent” solutions that truly meet women’s needs, says the Financial Alliance for Women.
This means understanding the differences in how females and males interest with financial services, then using this data and knowledge to build customer value propositions that help women overcome obstacles and solve their unique life moments.
For example, recent researches have shown that women are strong savers and better borrowers than men. Indian robo-advisory firm Scripbox, whose customer base is more than 28% women, has found that female customers are more disciplined savers (85% of women were invested in systemic investment plans compared to 80% of men), tend to save more (women saved 15% of their salary compared to 10% of men), and invest for the long-term and stay invested (only 10% of women withdrew from their mutual funds ahead of the term compared to 15% of men).
The Financial Alliance for Women further advises fintechs to integrate holistic, non-financial solutions into their customer value propositions, and move beyond building just gender-neutral products or changing the interface design and color.
Several fintechs have championed this and are now leading the way, the organization says. In wealthtech and personal finance management, startups like Ellevest (USA), Finmarie (Germany), Smartpurse (UK) and Basis (India) offer customized solutions to women. In credit, Juancho Te Presta (Colombia) and Kiu Global (Hong Kong) have credit-scoring algorithms that consider women’s better repayment behavior, while Sheroes (India) uses alternative data to generate credit scores for women. And in digital banking, hiveonline (Denmark) has customized its products for low literacy levels, targeting women in Africa, it notes.
Featured image credit: Unsplash
Visa Embraces USDC as U.S. Congressional Officials Take Aim at Stablecoins
U.S. card payments giant Visa is among the most influential and far-reaching companies in the world. Circle’s USDC is among the most popular stablecoin projects in Ethereum’s booming decentralized finance ecosystem. Take note, then, because the two entities are partnering up to bring USDC payments into Visa’s sprawling network of +60 million merchants. Announced Wednesday, […]
The post Visa Embraces USDC as U.S. Congressional Officials Take Aim at Stablecoins appeared first on Blockonomi.
U.S. card payments giant Visa is among the most influential and far-reaching companies in the world. Circle’s USDC is among the most popular stablecoin projects in Ethereum’s booming decentralized finance ecosystem.
Take note, then, because the two entities are partnering up to bring USDC payments into Visa’s sprawling network of +60 million merchants.
Announced Wednesday, Dec. 2nd, the partnership represents a huge legitimizing advancement for USDC, stablecoins in general, and Ethereum as the underlying decentralized infrastructure making it all possible. Yet the announcement also came on the same day a draft bill was introduced in the U.S. that, if passed, would have chilling effects on stablecoin efforts in America.
Accordingly, let’s break down what these big opposing developments represent for the cryptoeconomy going forward.
Visa Adding USDC to Payments Network
USDC is the second-largest stablecoin right now, its ~$3 billion market capitalization representing roughly 12% of the total stablecoin economy’s current $25.5 billion market cap.
Per Circle’s new partnership with Visa, then, the payments giant is going to begin aiding an initial set of Visa card issuers with onboarding USDC functionalities into their systems. Eventually, this program will be expanded to allow businesses to transact internationally with any Visa-supported companies.
As Visa’s lead cryptocurrency executive Cuy Sheffield noted on the news:
“This will be the first corporate card that will allow businesses to be able to spend a balance of USDC. And so we think that this will significantly increase the utility that USDC can have for Circle’s business clients […] We continue to think of Visa as a network of networks. Blockchain networks and stablecoins, like USDC, are just additional networks. So we think that there’s a significant value [here] that Visa can provide to our clients.”
This is a big deal as such, as it’s the latest high-profile example that stablecoins and Ethereum are really starting to break into the mainstream. It also shows that Visa is positioning itself as an early adopter to bolster its position as a “network of networks,” which is shrewd as stablecoins seemed prime to continue exploding in popularity over the coming decade.
Enter the STABLE Act
Wednesday also saw three U.S. Representatives — Rep. Rashida Tlaib, Rep. Jesús García, and Rep. Stephen Lynch — introduce a draft bill, the so-called STABLE Act, to the House of Representatives that would significantly tighten regulations around stablecoin projects in the U.S. if passed.
Specifically, the draft bill seeks to force essentially all stablecoin issuers to obtain a banking charter before being allowed to operate in the U.S., with the ostensible goal being to prevent such issuers from taking advantage of marginalized communities.
“Preventing cryptocurrency providers from repeating the crimes against low- and moderate-income residents of color traditional big banks have is critically important,” Rep. Tlaib declared in announcing the bill on Twitter.
Zooming out, this rhetoric strains credulity because Ethereum-powered stablecoins like USDC lower the barrier to financial access for people around the world and empower these users to engage with borderless, censorship-resistant finance.
.@RepRashida, stablecoins enable the creation of permissionless and censorship resistant financial products that are accessable to all
By attempting to regulate stablecoins away with the #STABLEAct, you are furthering the disenfranchisement of the unbanked
Do better. https://t.co/RtNOxKrNvu
— ChainLinkGod.eth (@ChainLinkGod) December 3, 2020
That said, the STABLE Act really only stands to ice out cryptocurrency innovation and enterprises in the U.S. But that’s not even the worst part about this bill, if you can believe that. The worst part is that it’s language is so broad, if passed even people just running Ethereum nodes could be held accountable for the stablecoin transactions happening on the network.
Who is running the nodes? There is no such thing as a network without accountable parties.
— Rohan Grey (@rohangrey) December 3, 2020
To make an analogy, that’d be like holding internet service providers (ISPs) directly accountable for all their users’ internet activities. It’s a ludicrous position and suggests the draft bill’s authors don’t really understand Ethereum or are active detractors against it.
The good news? The bill has no chances of passing in the current congressional environment. The bad news is Ethereum and its stablecoin ecosystem are growing as targets.
Everyday Uses of Chromatography
Chromatography is a term that many people may not be familiar with, but in many ways, chromatography affects our lives every day. Chromatography is essentially the process of separating a compound from a mixture, so it can be useful in many industries to analyze data and draw conclusions. Even if you don’t necessarily use chromatography every day, the benefits associated with the process affect your life daily.
Of the many everyday uses of chromatography, crime investigation via forensic testing is one of the more well-known. If you have ever seen a crime show on television, you have seen chromatography at work. In a real-life criminal investigation, gas chromatography is used to investigate cases. When investigators assessing the crime scene and collecting evidence, forensic labs use chromatography to analyze the evidence. Chromatography is also used to investigate arson. Gas chromatography can detect whether a liquid accelerant was used to start the fire. Another form of chromatography used in forensic testing is ink chromatography. Ink chromatography is used to match the ink on a document with the pen that belongs to the suspect.
Chromatography is used to test food from the source to the final product. There are many chromatography applications in agriculture, as well as in the food industry. Basically, chromatography gives us a better understanding of what exactly is in our food and whether is it safe to ingest. Chromatography is used to identify any harmful pesticides in food. Chromatography also keeps consumers safe by fact-checking nutritional value and ingredients. This is especially important for anyone with food allergies or sensitivities. For this reason, chromatography is used to test food that is gluten-free or vegan, as well.
Source: Christina Duron is a freelance writer for multiple online publications where she can showcase her affinity for all things digital. She has focused her career around digital marketing and writes to explore topics that spark her interest.
Payment Service Provider PingPong Payments Secures E-Money License in Luxembourg
PingPong Payments, a payment service provider for e-commerce sellers, announced on Wednesday it has received its authorization as an Electronic Money Institution (EMI) by the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg. Founded in 2015, PingPong stated that its mission of helping global e-commerce sellers keep more profits, by beating the rates traditional banks offer.
“Today, the company serves more than 600,000 online sellers worldwide, has processed more than $10 billion in cross-border payments for e-commerce merchants to-date, and transfers more than $100 million per day for international e-commerce sellers. Global merchants around the world trust PingPong Payments to help them save on cross-border payments, VAT & supplier payments, and more.”
PingPong reported that the license enables it to offer a more flexible array of services and increase the scope of customers in the future. Speaking about the license, Ning Wang, Co-Founder and Chief Business Officer at PingPong, stated:
“We are extremely proud to announce obtaining an EMI license in Luxembourg, a world-renowned fintech hub and pioneer within the EU market. This will strengthen our existing services which can support customers on different market places such as Amazon, eBay and Walmart and grant us the flexibility to broaden our business model to beyond e-commerce platforms.”
Pierre Gramegna, Minister of Finance, Luxembourg added:
“Today, Luxembourg is one of the leading payment and e-money hubs in the EU and I’m happy to see that it continues to grow. In this sense, I welcome that PingPong has just upgraded its Luxembourg presence with a new e-money license that will help it better serve its European customers.”
Do China tech giants pose a risk for European banks?
China’s Ant group may have been dealt a setback with the shelving of its IPO but European banks remain wary that Chinese tech giants may soon be their main competitors.
The European finance sector has in recent years seen the emergence of a large number of startups—called fintech—which have sought to disrupt brick and mortar banks by offering digital services.
While they have yet to really threaten established banks, the fintechs have forced them to dust off their operations and invest massively into providing similar digital services.
“The real competitor of tomorrow will likely be the GAFAM or the Ants of the world which have the capacity to invest considerable sums,” the head of France’s Societe Generale bank, Frederic Oudea said recently, using a French acronym for Google, Apple, Facebook, Amazon, and Microsoft.
US tech giants have been making more beachheads in financial services an area where their Chinese rivals are already well advanced.
From chat to super app
Ant Group, which was hoping to raise a record $34 billion with its IPO before the Chinese government pulled the rug out from under the operation, is the owner of Alipay, a payment platform which is now an unavoidable element of daily life in China.
Its prinicipal rival in China is WeChat Pay, owned by Internet giant Tencent.
“The companies which originally developed chat software have a strong interest in enhancing these activities as they enable them to cover an even broader range of people’s day-to-day activities,” said Christopher Schmitz, an expert on fintech at Ernst & Young.
“Gradually, an ever larger-growing share of people’s spending goes to these companies,” he added.
The Chinese have widely adopted paying by flashing QR codes of vendors on their smartphones using Alipay or WeChat Pay due to its convenience.
Alipay alone has 731 million monthly users.
In just a few years these two platforms have transformed China from a country where cash was king to a society where smartphones are the payment medium of choice.
These companies are not content with just offering payments. They offer more financial services, including the ability to obtain a loan with just several clicks.
“Alipay generates more revenue from the financial services that it offers, such as investment schemes and loans, than the payments themselves, which is really just the tip of the iceberg of what has become a super app,” said Adrien Boue, a consultant on the electronic commerce market.
He said “the goal is that users stay in the app as long as possible. From morning to night, there is always a functionality there: speaking with friends, ordering a taxi, ordering food and even working on collaborative projects.”
“The most advanced model in the financial sector—it’s China,” said Oudea.
The question is just how much of this model can be reproduced in Europe, especially after Ant Group’s IPO setback, which some observers see as a move by the Chinese authorities to bring an overly ambitious firm to heel.
“Our banks are still a bit protected,” said Julien Maldonato, a financial services expert at the Deloitte France consultancy. “There are still cultural barriers, but these won’t protect us forever.”
One of those cultural barriers are QR codes.
“In Europe, payments based on QR codes are noy very popular,” said Ernst & Young’s Schmitz.
The fragmented nature of Europe with its different languages and cultures also makes it difficult for an outsider.
But Maldonato noted that American tech companies are already very much present in the daily lives of Europeans, and China’s TikTok has attracted young users who are “the banking clients of tomorrow”.
It is the capacity of the Chinese companies to plough money into developing new technologies and acquiring customers—they each plan to invest some $70 billion over the next five years—that could really change the game.
“That worries the Americans who will accelerate” their investments as well, said Maldonato, while European companies will have trouble coming up with even a few billion.
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