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The New Fintech Strategy Aiming to Make Lithuania ‘the Number One Fintech Hub in Europe’


The base for over 260 fintech companies which employ over 7,000 people, Lithuania has enjoyed significant success and growth throughout the last few years. Now, it is adopting a new fintech strategy to capitalise on recent growth and hopes to establish itself as a fintech ‘centre of excellence’.

Throughout the last decade, the fintech industry in Lithuania has exploded into life. Home to just 55 fintech companies in 2014, the Eastern European country saw consistent growth up until 2021 when it boasted 265 fintech firms.

Despite this growth plateauing in 2022 (with 263 fintech companies) due to difficult macroeconomic conditions, the industry has remained resilient and is gearing up for further progress in the coming years.

As Lithuania takes another step towards fintech success, it has revealed a new industry strategy, highlighting its plans and goals for the sector. Lithuania’s 2023 to 2028 Fintech Strategy is ultimately aiming to make the country the leading fintech hub in Europe.

Simonas Krėpšta, a member of the board at the Bank of Lithuania
Simonas Krėpšta, member of the board at the Bank of Lithuania

Simonas Krėpšta, a member of the board at the Bank of Lithuania, explained to The Fintech Times the motivation behind adopting the strategy: “Today, more than 25 million Europeans are benefiting from the financial services of companies licensed in Lithuania. This is both an acknowledgement of Lithuania and a significant responsibility.

“Recent events in the global markets have highlighted the importance of striking a balance between developing financial innovations and managing risks. The new Lithuanian fintech strategy underscores Lithuania’s ambition to become the highest-quality fintech hub in Europe.

“Fintech development is one of the directions for the Bank of Lithuania to increase competition in the financial market. These companies have had a positive impact on the competition and accessibility of financial services, enhancing Lithuania’s global image.

“For example, electronic money and payment institutions have boosted competition in the payment market, while P2P and crowdfunding platforms have contributed to the increase in lending activities.

“The crowdfunding sector is currently undergoing regulatory transformation from the national to EU level, and seven companies have obtained pan-European licenses, opening new business opportunities.”

Five guiding principles

Lithuania has already established itself as a market leader in the fintech sector. Impressively, it currently sits as the eighth lowest-risk jurisdiction on the Basel Index, an independent ranking assessing the risk of money laundering and terrorist financing around the world.

While this highlights its existing high standards for business practises and regulatory compliance, the country has plans to drastically expand the size and influence of its fintech sector. To do so, its new fintech strategy outlines five ‘guiding principles’ that aim to drive its ambitions for the sector by 2028:

  1. Supporting the qualitative development of the fintech sector in Lithuania
  2. Attracting innovative fintech solutions to Lithuania
  3. Ensuring that Lithuania is the centre of excellence for fintech
  4. Ensuring that Lithuania is a safe and reliable jurisdiction
  5. Ensuring that Lithuania is universally recognised as a European fintech hub

To help achieve these aims, the report sets out several performance indicators, which will help identify if the country is on track to achieve its aims in 2028. These include facilitating a 30 per cent annual fintech revenue growth rate; serving at least 35 million fintech clients; as well as reducing the number of fintech companies facing talent shortages to 30 per cent (down from 62 per cent).

The key is collaboration

The key to much of the strategy’s goals and aims appear to lie in one place: collaboration. As Lithuania’s Minister of Finance, Gintarė Skaistė, puts it, the new strategy “demonstrates a clear collective commitment to fostering an environment in which fintech can thrive.”

To support collaboration between fintechs, regulators and banks in Lithuania, the new fintech strategy also sets out plans for the Ministry of Finance to analyse the various problems damaging the efforts of fintech companies that are attempting to raise capital.

In turn, the Ministry will then potentially propose solutions such as expanding the scope of business support measures or doing more to attract international investors.

The Lithuanian government has also recognised the importance of doing its part in supporting fintech companies. Alongside implementing a range of initiatives aimed at training its own talent, it has simplified its migration procedures for incoming foreign professionals to make Lithuania an increasingly attractive destination for talent.

Furthermore, to strengthen the prevention of financial crimes and fraud, the fintech strategy outlines plans to promote cooperation between the various supervisory authorities, as well as between supervisory authorities and supervised entities.

Collaboration is “conducive to innovation”
Lina Zemaityte-Kirkman, head of Rockit
Lina Zemaityte-Kirkman, head of Rockit

Lina Zemaityte-Kirkman, head of Rockit, the non-profit firm fostering innovation by helping Lithuanian fintech and sustainable innovation startups grow, also explained: “Lithuania’s fintech ecosystem thrives on a strategic combination of factors that help our ecosystem grow. A key driver is the effective collaboration between governmental institutions and fintech entities, fostering an environment conducive to innovation.

“Maintaining high positions in the Basel index underscores the nation’s commitment to financial stability, while an unwavering focus on Anti-Money Laundering (AML) and compliance ensures sector maturity.

Krėpšta also explained how the Bank of Lithuania also explained how collaboration sits at the forefront of its actions: “We engage in constructive dialogue with fintech market participants, addressing challenges collaboratively. The Bank of Lithuania issues recommendations, analyses specific topics, organises training meetings and seminars, and collaborates with financial market supervisors from other countries, including joint investigations, especially in the Nordic-Baltic region.”

Where do Lithuania’s biggest challenges lie? 

According to Krėpšta, one of the main challenges that Lithuania is facing is how it approaches the crypto industry and the forthcoming MICA regulation.

However, he also explained how it has plans in place to prepare for difficulties: “The Bank of Lithuania will be responsible for licensing crypto companies, and we are preparing for that. However, market access will be granted only to applicants who can prove their maturity and commitment to compliance, with particular attention to the AML and counter-terrorism financing area.

“The Bank of Lithuania provides risk-based supervision, meaning that we allocate the greatest attention to areas with the highest probability of risk. The growth of the fintech sector closely coincides with intensified supervision.”

Zemaityte-Kirkman concludes: “What sets Lithuania apart is not just its ambition to be the number one fintech hub in Europe but also its dedication to cultivating competitive expertise and ensuring the highest quality standards within the sector.”

Whether Lithuania can succeed in its ambitious goals is yet to be seen, but if it can grow the sector as it plans to, the Eastern European country should be more than on its way to overtaking competitors across the continent.



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