The Financial Solutions Lab (FinLab), an innovation programme backed by JPMorgan Chase, is looking to make fintech a little less male and white, calling on entrepreneurs of colour, women and people with disabilities to take up its latest challenge to develop products that can support under-represented communities – and, in the process, bag a slice of a $3 million prize fund.
Now in its fourth year, the annual FinLab challenge is asking entrants to dream up fintech products and services that can meet the needs of huge parts of the American population that are often overlooked by the banking sector and struggle with income and expenses volatility – hurting their financial well-being and, often, their health.
Many of those underserved by traditional banking are women and people of colour but these groups are also under-represented in the fintech community. All-women teams of entrepreneurs received just $1.9 billion of the $85 billion total invested by venture capitalists last year and only an estimated three per cent of the venture capitalist workforce is black while only four per cent is Hispanic or Latino.
FinLab is looking to help change this, arguing that “diversity among leaders and teams also leads to more inclusive products and services with the potential to scale to millions of customers”.
Organisations that successfully apply to take part in the lab will each receive $250,000 in capital, professional services assistance from industry leaders such as ideas42 and Google, strategic guidance from the FinLab’s advisory council, and resources from founding partners, including the JPMorgan Chase employee mentorship programme.
Applications are open until 11 April.
“Technology offers a tremendous opportunity to help us reach overlooked populations with financial products and services that can improve their long-term financial health,” says Colleen Briggs, head, community innovation, JPMorgan Chase.
“We want to see more innovation designed to meet the needs of underserved populations and teams of entrepreneurs that reflect this diversity. We believe that the FinLab’s continued focus on inclusive fintech will help us unlock this potential.”
Separately, JPMorgan has used its annual investor day to explain the decision to open hundreds of new bank branches and ramp up technology spending. The bank says that it is expanding its branch network into new markets largely to boost its mortgage business, which is “exceptionally local”.
But the branches will be backed by technology investment. Overall JPMorgan is planning to put an extra $1.4 billion into tech this year, some of which will go on tapping big data to identify new mortgage customer and make the application process more digital.
More generally, explaining the heavy tech spending, CEO Jamie Dimon referenced Amazon as an example of a firm that puts money into improving the customer experience while also taking punts on entering new markets.