Exclusive: ‘What she really, really wants’ – Vanise Zimmer, Elas in “The Paytech Magazine”

Dr Vanise Zimmer, founder of Elas, a bank designed to empower women in Brazil, hopes her fintech’s legacy will be a new, confident and financially independent generation.Valise Zimmer | Fintech Finance

Over the past century, women have campaigned hard for gender equality. It’s now constitutionally recognised in 143 out of the world’s 195 countries. But that doesn’t mean discrimination doesn’t persist – financial discrimination in particular.

Worldwide, more women are joining the workforce than ever before. According to the World Bank, between 1990 and 2019, the number employed in Brazil increased to 54 per cent of the adult female population. In Bangladesh, it went from 25 to 36 per cent. And in Qatar, from 42 to 59 per cent.

And yet, despite this apparent accumulation of female purchasing and saving power, many women – 42 per cent – have zero access to an account with a formal financial institution. That’s according to UN Women, the United Nations entity dedicated to gender equality and female empowerment. While it acknowledges that 35 per cent of men are similarly disadvantaged, for women, financial exclusion has particular, even life-threatening, consequences.

Psychologist and fintech entrepreneur Dr Vanise Zimmer has spent years working with women’s groups, researching the consequences of financial exclusion, and draws a direct line between it and domestic abuse, particularly in her own country of Brazil where it’s estimated that, every two minutes, a woman suffers an act of violence from a partner. More than 1,200 of those attacks were fatal in 2018, according to the Brazilian Public Security Forum. Because women must rely on the men they live with to take out a mortgage or sign a rental agreement, ‘when they suffer violence they cannot leave the house, because they will lose everything’, says Zimmer.

So, she set out to do something about it. Zimmer founded Elas, a neobank that was built specifically to give women the financial independence that buys them freedom from abuse and helps them to build a better life. Elas is the plural of ‘she’ in Portuguese, and Zimmer wants to leverage the power of this fintech as a tool for social justice: to help end financial instability, economic dependence – and domestic violence – experienced by women.

“I studied for a bachelor’s degree in psychology and then, for my masters, I started looking at gender equality. I was invited to Germany to help to construct the first women’s international university,” says Zimmer. “I researched gender and finance and I saw few women in that industry. That made me really worried.”

That is particularly the case in investment and wealth management. In private equity, only six per cent of senior positions are held by women. It’s the same story in venture capital funds, where just nine per cent of senior seats are occupied by women. For hedge funds, that number is 11 per cent. While much of society has moved on, somehow finance never stopped being a man’s world. It means that financial products and services are built mainly by men, for men. Elas is different. It’s designed by a woman, for women – although men, says Zimmer, are welcome to join.

Zimmer’s first challenge was to address the glaring gap in financial literacy that exists especially among the poorest women in Brazil, who don’t see the need for a bank account.

“When they work in the informal labour market, women do not get money deposited in a bank account, they get money in their hands. They do not learn how to save for the future, or for retirement, which means they have no security,” says Zimmer.

Because they usually have family responsibilities, they need to keep working in the same place to maintain cashflow, leaving them with little wiggle room to break free or try something new. It narrows the possibilities of taking a risk, like starting a business, or saving for a higher education, which are all ways to escape cash-in hand jobs and gain more financial stability.

“They need to think about finance, and that was not happening in Brazil for the lower classes,” says Zimmer. “These women have no independence.”

So, this is her social project: using app-based algorithms to boost financial literacy and accessibility for those who need it most – poor and middle-class women.

“We’ll teach them how to invest, how to open and run a bank account, how to use a computer. We are going to make them capable of working in finance, of doing finance,” says Zimmer.

In that, she is helped by the fact that Brazil is highly engaged digitally. It is ranked number five globally for smartphone usage, with 84 million adults – 54 per cent – chatting, texting and swiping daily. And that’s only increased since the pandemic.

“It improved our access to the digital world. So, economically, it also became a digital world,” she says. And, once women get the information, support and access they need, chances are they will make a better job of financial planning than men.

Evidence shows that women are the more dedicated savers, more responsible borrowers and more calculated risk-takers. According to recent research from BNY Mellon, giving women better access to finance could unlock at least $330billion in annual global revenue, while the latest Women in Financial Services report from Oliver Wyman says women’s financial needs are still not being met, making them the largest underserved group of customers for banks, fund managers and insurers.

Zimmer believes that creating a way for women to safely deposit their earnings digitally will be transformational, allowing them to plan ahead, especially over longer timeframes. Think about that. One fintech could mean that a dependant woman becomes independent. A mother could afford to walk away from an abusive partner. A young woman could get a degree and set up her own business. And not just one. There are more than 100 million women living in Brazil. Can you even imagine the extraordinary impact that could have on the country’s economy?

“They’ll have a bank account, a credit card, a machine to pay locally, and we are going to use QR codes, too,” says Zimmer.

But, importantly, the Elas user journey will be goals-based and support women’s specific aspirations.

“It’ll be much easier for women if they invest according to the objectives they have in life,” says Zimmer. “So, you choose, for example, ‘I want to have a house’, ‘I want to have a car’, ‘I want to pay for my daughter’s university’, ‘I want to have money for my retirement’. Once you’ve chosen, the robo-advisor will do everything for you.”

As well as being the founder of Elas, Zimmer is a partner in white label robo-advisory platform RoboBanker, which was set up to give everyone access to a private banker with deep knowledge of the financial market and advanced asset allocation methodologies. RoboBanker believes that digital financial management isn’t simply about providing savings spaces on an app. Rather, it provides tools to help those on even very moderate incomes make realistic plans. “[There’s] nothing worse than saving money for an irrelevant goal and therefore not being able to pay for the daily milk,” it says. That should resonate with the women Elas wants to onboard.

“We are the first bank in Brazil to have a robo for women to invest, to choose the options to get to the objectives they want in the future,” she says. “We are inside women’s organisations, so we have the data. We know how to feed the algorithms.”

Elas appears to be the first female-focussed neo bank. And, if Zimmer succeeds, it could be revolutionary for women in Brazil.

“We do not have aspirations to be worldwide,” she says. “Brazil still has a lot of work to do to make women’s lives better. It will not be easy: we are going to fight some organisations that exploit women. But when my daughter was born, I thought ‘I have studied a lot, I have to do something now for the new generations’. It’s a big responsibility.”


 

This article was published in The Paytech Magazine: Issue #06, Page 18-19

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