Leyre Celdrán Edo
AEFI Asociación Española de FinTech e InsurTech
Professor Cristina Díaz-García
University of Castilla-La Mancha
Bridging the Finance Gap for Women Entrepreneurs
Insights from Academic and Policy Research
Fintech is generally associated with financial innovation (Zavolokina, Dolata and Schwabe, 2016[1]) that concentrates on three main areas: new payments systems, advanced risk management and alternative lending solutions (Langley and Leyshon, 2017[2]). A fintech organisation can be considered as “any organisation within the finance sector that uses innovative technology to simplify operations and improve financial performance” (Becker-McNabola, 2018[3]). Similarly, the traditional insurance industry has been improved and automated using innovative technologies (AI, Big Data, Blockchain, Machine Learning) leading to the insurtech sector.
In 2022, two laws were passed that were born with the aim of promoting and strengthening entrepreneurship, investment and talent attraction, known as the Start-up Law and the Create and Grow Law. According to the Government of Spain, the Start-up Law was created with two objectives (i) tax benefits and (ii) attraction of international investment and talent.
Spain continues to face political uncertainty as well as global economic and geopolitical uncertainty. This situation of instability is hindering the implementation of the specific proposals and objectives that these two laws brought to encourage entrepreneurship. This includes one of the most ambitious objectives of promoting women’s entrepreneurship and eliminating the gender gap – a commitment included in the Agenda “Digital Spain 2025” (Spain, 2024[4]):
“It is of particular importance to eliminate the existing gender gaps, since our country will not be able to achieve the desired competitiveness if the necessary measures are not taken to incorporate the talent of women into the ecosystem.”
Therefore, it was also supported by the Plan of Recovery, Transformation and Resilience, which was communicated through the High Commissioner Spain Entrepreneurial Nation and dependent on the Presidency of the Government, but which disappeared in February 2023. This leaves the policy agenda currently without a clear driver.
Government support is essential to encourage more women to start and carry out innovative projects within the financial industry. Development is not easy, but there are mechanisms that facilitate the creation of companies in the fintech and insurtech sectors, such as the Regulatory Sandbox that was approved in 2020 which started its tenth call in September 2025. However, there is still a need to for initiatives to support women’s entrepreneurship in the financial sector since a multitude of obstacles remain.
Both the fintech and insurtech sectors in Spain are examples of how optimistic forecasts that predicted improved access to financial products and services for women have not been achieved. This is demonstrated by the “VI FinTech Women Network Report” published by the Spanish Association of FinTech and InsurTech (AEFI). The AEFI has collected information about female talent within the ecosystem over the past six years. Although the number of women in senior management positions has grown strongly, women’s entrepreneurship in the fintech sector in Spain remains very limited. Currently, only 1 in 10 entrepreneurs in the fintech sector is a woman, which is a decline from 14% in 2018 (Figure 31.1). This decline was largely due to the effects of the COVID-19 pandemic when women were more likely to give up their professional careers and abandon their business projects to take care of their relatives. After that strong impact, recovery in the numbers of women entrepreneurs within the sector has been slow. This percentage is in line with other developed countries with around 11-14% of firms founded by women (Khera et al., 2022[5]).
Note: Study conducted each year among the associated companies and partners of AEFI, which in 2019 represented more than 130 companies (693 women were surveyed representing 57% of the people employed in the sector) and in 2023 represented 180 companies (women representing 37% of the people employed/self-employed in the sector).
The AEFI carries out workshops to explore challenges faced by women, including questions, such as why are women less likely to start a business in this sector and what barriers do women face when they want to take off their professional career. These issues have been analysed and debated since 2018, and some conclusions have emerged:
1. Women have more aversion to failure than men, which is consistent with previous research (Schubert et al., 1999[7]; Charness and Gneezy, 2012[8]). In the last Women Fintech Network Report (2023), the majority of women (53%) believe they have had the same job opportunities as men (Spanish Association of FinTech and InsurTech, 2023[6]). However, nearly 45% of women state that they have had fewer opportunities than men in their work environment. Besides this, a significant majority (61%) affirm that they have had to exert more effort than men to achieve their current professional position. This perception has been decreasing since 2020; however, it has increased 30% in comparison to 2022 report. Therefore, gender barriers persist.
2. Access to financing and investment is more difficult for women, and they feel they are in a situation of inequality compared to projects led by men. This is also in line with previous literature (Greenberg and Mollick, 2017[9]), which stated that gender homophily has been known to affect start-ups, especially those led by women. Ewens and Townsend (2020[10]) find that male investors express less interest in women entrepreneurs compared to similar men entrepreneurs. In contrast, women investors express more interest in women entrepreneurs. Kanze et al. (2018[11]) identify that the funding gap originates with a gender bias in the questions that the investors pose to entrepreneurs, since they tend to ask men entrepreneurs promotion-focused questions (potential for gains) and women entrepreneurs prevention-focused questions (potential for losses).
3. Furthermore, a significant barrier faced by companies seeking to raise capital or attract investors is the lack of suitable spaces where they can (i) connect with potential investors in a friendly manner and (ii) address the insecurity they feel when sharing their business idea or model, especially when they lack protection against plagiarism or copying. Transparency regarding motivations and investment possibilities is crucial. Many entrepreneurs report spending considerable time on individualised searches for potential investors.
4. Women entrepreneurs lack role models within the fintech and insurtech sector.
5. The greatest barrier to entry into entrepreneurship in fintech and insurtech, regardless of gender, is the fulfilling bureaucratic and regulatory requirements. Many business models require authorisation or licensing from the Bank of Spain, the CNMV (National Securities Market Commission) or the DGS (General Directorate of Insurance) to operate. The licensing process can take up to two years, and post-licensing supervision is stringent, akin to that applied to major banks.
Creating an environment that facilitates the emergence of a competitive landscape for digital financial services while reducing bureaucratic and regulatory obstacles is crucial for fostering innovation and entrepreneurship in this field. Furthermore, fintech and insurtech companies play a significant role in expanding Spain’s business industry, generating skilled employment and promoting socially impactful innovative projects. Regulatory agility is essential for the sustainable development of this dynamic sector. Especially in the fintech and insurtech sector, there is low visibility of women’s entrepreneurship and little support for women that want to start a business. One of the ways that government could give a push to fintech for women entrepreneurs would be by applying the principle of proportionality when requesting a license or authorisation to develop a project in the financial industry, based on the company’s size and focus, recognising the difference between business-to-consumer (B2C) and business-to-business (B2B) enterprises. Policy makers could also consider a public-private investment mechanism for women entrepreneurs in the fintech and insurtech sector, for example following the model of the United Kingdom “Future Fund” initiative.
References
[3] Becker-McNabola, T. (2018), An Exploratory Study of the Barriers and Enablers That Influence The Career Advancement of Women to Leadership Roles in Fintech, National College of Ireland, https://norma.ncirl.ie/3364/1/tamarabeckermcnabola.pdf (accessed on 2 October 2024).
[8] Charness, G. and U. Gneezy (2012), “Strong Evidence for Gender Differences in Risk Taking”, Journal of Economic Behavior & Organization, Vol. 83/1, pp. 50-58, https://doi.org/10.1016/j.jebo.2011.06.007.
[10] Ewens, M. and R. Townsend (2020), “Are early stage investors biased against women?”, Journal of Financial Economics, Vol. 135/3, pp. 653-677, https://doi.org/10.1016/j.jfineco.2019.07.002.
[9] Greenberg, J. and E. Mollick (2017), “Activist Choice Homophily and the Crowdfunding of Female Founders”, Administrative Science Quarterly, Vol. 62/2, pp. 341-374, https://doi.org/10.1177/0001839216678847.
[11] Kanze, D. et al. (2018), “We Ask Men to Win and Women Not to Lose: Closing the Gender Gap in Startup Funding”, Academy of Management Journal, Vol. 61/2, pp. 586-614, https://doi.org/10.5465/amj.2016.1215.
[5] Khera, P. et al. (2022), “Women in Fintech: As leaders and users”, WP/22/140, International Monetary Fund, https://www.imf.org/en/Publications/WP/Issues/2022/07/15/Women-in-Fintech-As-Leaders-and-Users-520862 (accessed on 2 October 2024).
[2] Langley, P. and A. Leyshon (2017), “Capitalizing on the crowd: the monetary and financial ecologies of crowdfunding”, Environment and Planning A, Vol. 49/5, pp. 1019-1039.
[7] Schubert, R. et al. (1999), “Financial Decision-Making: Are Women Really More Risk Averse?”, American Economic Review, Vol. 89/2, pp. 381-385, https://doi.org/10.1257/aer.89.2.381.
[4] Spain (2024), Digital Spain 2025, https://portal.mineco.gob.es/RecursosArticulo/mineco/ministerio/ficheros/210204_Digital_Spain_2025.pdf (accessed on 8 January 2025).
[6] Spanish Association of FinTech and InsurTech (2023), VI FinTech Women Network Report, https://www.asociacionfintech.es/recursos/#informes (accessed on 2 October 2024).
[1] Zavolokina, L., M. Dolata and G. Schwabe (2016), FinTech – What’s in a Name?, https://www.researchgate.net/publication/318268448_FinTech_-_What%27s_in_a_Name (accessed on 2 October 2024).