FemTech: How Financial Learning is Bridging the Investment Gender Gap Once and For All

‍

While FemTech is commonly associated with fertility tracking apps or menstrual cycle softwares, it has slowly ventured into not only providing guidance to women through their health but also through their personal finances and investments. And therefore, expanding women into new financial terrains.

Empowering women's financial decision-making through female-centric technology

‍Undoubtedly, men have historically dominated the financial sphere. While barriers to women's economic participation has reduced over the years, gender parity in the world of investing is yet to be reached. That’s why FemTech is such a powerful development when it comes to bolstering women’s knowledge and financial confidence - one of the most cited aspects understood to hinder their investment participation and frequency compared to their male counterparts. In fact, 1 out of every 3 women don’t feel they have the knowledge to be more involved in investing according to numbers from Bank of America.

Director and founder of Finthropology, Dr Anette Broløs alongside Managing Director and founder Dr Erin Taylor, interviewed Swiss women as part of a larger study on female finance. They investigated the influence of confidence amongst women when it comes to financial services and decision-making.

“We made the discovery that in Switzerland, even highly educated women felt that they needed to know a lot more to be able to invest in stocks and bonds, and they generally felt that their bank advisors were condescending,” says Dr. Anette Broløs.

‍

‍

The Swiss women are not alone with feeling isolated and uncertain about whether to take the leap on starting, or expanding, their financial portfolios. Numerous surveys exploring British and Dutch habits also unearth similar tendencies, revealing that women still have lower confidence in their own decision-making abilities regarding stocks and investments. It is also a feeling that resonates with Terezie Krasenska, a mental health worker from Derby, UK, who after contemplating whether to take the plunge for four years, finally dived into the world of investing after initiating a membership with Female Invest.

“I found myself struggling to educate myself on the topic. Despite researching, I felt less confident and began doubting my abilities. Joining the Female Invest community has been a game-changer, as they've helped me understand everything I needed to start investing,” says Terezie Krasenska.

As a response to women’s challenges in accessing inclusive and relevant financial literature, a wave of FemTech investment platforms have emerged – and Female Invest is proud to be at the forefront. These innovations are specifically designed and developed by women, for women, to provide solutions through tailored communities, resources, and female-centric learning environments that address gendered struggles within investing. Female Invest, for example, has amassed over 35.000 members in 95 countries, after creating an entire universe of learning and community – talk about making a difference.

How the ‘stereotype threat’ influences women's financial confidence

Closely linked to differences in women’s and men's confidence is the term ‘stereotype threat’ - the psychological predicament where group stereotypes influence the way that individuals evaluate themselves, which in turn may affect their performance of tasks that can lead to those stereotypical beliefs.

‍

‍

Gustav Tinghög, Ph.D. in Economics and professorat Linköping University in Sweden, has researched on this specific topic and its impact on Swedish women’s financial behaviour. “The results we found strongly indicate that a ‘stereotype threat’ contributes to explain why women perform worse compared to men when it comes to financial literacy when tested on those skills,” says Dr. Gustav Tinghög.

The existing reality of stereotyping, prejudice, and a lack of confidence in financial matters means that there is still a need for services that address these specific issues to further enable women to trust their judgement, such as in investing.

As Dr. Anette Broløs puts it: “These new solutions provide services that actually meet women's needs. And it’s happening at a time when women's wealth is also growing faster than mens’. These new services offer both short and long-term savings and goals - as well of course as the trade-off between risk and profit.”

‍

FemTech is empowering women globally

The reality is that FemTech apps like Female Invest are unlocking women’s untapped potential. Today, women exhibit higher investment success rates than men when they do decide to invest. So while the financial gender gap is yet to close, digital resources offer promising opportunities in “helping females get closer to empowerment,” says Dr. Gustav Tinghög.

For British Female Invest member Charlotte Laflin, access to digital resources did just that by offering a global community contributing that instilled confidence in her and her investing journey:

“My experience with Female Invest highlights the importance of spending time on finances and also looking out for ‘future me’. I have four children who I have been learning alongside with, so this will also give them a much better start than I had,” says Charlotte Laflin.

Final thoughts

WithFemTech taking off, its female-centric approach proves to be an up-and-coming tool in bridging the financial gender gap. Even more promising, it enables women to take matters into their own hands and to improve their financial well-being.

The Female Invest community is one example proving the power easily accessible financial knowledge has. By creating a community of women interested in investing, more and more women are empowered to take financial matters into their own hands with the help of a FemTech platform.

‍