The potential is also confirmed by the fact that in the first half of this year, the income of the Lithuanian electronic money and payment institutions sector grew by more than 20 percent. Lithuania has every opportunity to maintain consistent growth and become an even more attractive space for foreign investments.
According to the Bank of Lithuania, the revenue of the sector’s licensed activities in the first half of the year amounted to 275.1 million. EUR – compared to the corresponding period last year, they increased by 22 percent. The amount of payment transactions increased by more than a third – almost to 132 billion. Eur. It is estimated that 27 million people use the services of companies based in Lithuania. customers across the EU.
The field of electronic money and payment services is one of the engines of Lithuanian fintech. And the fact that the country is attractive to international investors is confirmed by the arrival of major players in this sector, such as Revolut, Airwallex, Nuvei, to Lithuania. This also led to the growth of local companies such as TransferGo, NEO Finance, Paysera.
It is worth noting that the “fintech” sector contributed significantly to Lithuania improving its position in the international tax competitiveness index, rising from seventh to fifth place in the world. This is a major achievement for a country that is constantly seeking to attract foreign investment and stimulate economic activity.
Last year, out of 34 countries, Lithuania was among the 10 countries with the lowest money laundering (AML) risk (ranked 9th). This year’s Council of Europe Committee of Experts for the Evaluation of Measures to Combat Money Laundering and Terrorist Financing (MONEYVAL) emphasized the significant progress of our country in the fight against money laundering and terrorist financing. Fintech companies, which pay a lot of attention to AML risk assessment and management, have contributed to these achievements. Market participants are actively investing in human resources, increasing employee competencies, and implementing the latest AML technologies.
It is estimated that almost 7.5 thousand people worked in “fintech” companies in Lithuania last year. employees, and the companies added more than 100 million to the state budget. Eur.
According to Expert Market Research, the global fintech market has grown rapidly in recent years and continues to expand at an impressive pace. It is predicted that by the end of this year the total market value may reach about 300 billion. EUR, and in the future the market is expected to grow by approximately 14 percent annually. and until 2029 can reach almost 600 billion Eur.
How to ensure the growth of the sector
Even three elections were held in Lithuania this year. For the successful further growth of the fintech sector, it is necessary to maintain the continuity of the fintech policy. In a few years, Lithuania has become one of the fintech leaders in the EU. One of the main reasons for such growth – successful cooperation between fintech market participants and politicians. I believe that with active cooperation, the sector can go even further, creating more opportunities and benefits for the people of Lithuania.
A few wishes for the new government, what should be paid attention to when thinking about the growth of fintech. I think it is especially important that the Ministry of Finance continues to ensure the 2023-2028 presented last year. Further implementation of the guidelines for the development of the Lithuanian “fintech” sector. The guidelines prepared together with partners provide for essential work in order to continue to maintain the country’s leading position in Europe.
The Ministry of Economy and Innovation, which is responsible for increasing the attractiveness of the investment environment, and regulation of the fintech sector based on risk assessment, plays a very important role in the growth of fintech. Recently, there is a lot of communication with companies providing international financial services that are considering establishing themselves in Lithuania. In order to attract these companies to our country, it is necessary to continue to ensure a good investment environment.
The Ministry of Education, Science and Sports should continue to focus on improving the skills of the youth. Fintech companies plan active expansion and intend to create more well-paid jobs both in large cities and in regions. Therefore, it is extremely important that young people have opportunities to acquire skills and knowledge in higher education institutions, which would allow them to get a job in companies providing financial services.
As for the Seimas, I would like to wish the newly elected members of the Seimas to continue involving market participants in the legislative process. After all, the best decisions are born only in detailed discussions.
The active cooperation of the Lithuanian institutions, the Bank of Lithuania, the Financial Crimes Investigation Service, the Money Laundering Prevention Competence Center of VšĮ with market participants should be further encouraged. “Fintech” companies listen to the recommendations of Lithuanian institutions, implement the requirements for the prevention of money laundering and terrorist financing, and submit proposals.
The Government Chancellery also plays an important role. The people working there are responsible for coordinating fintech issues between different institutions.
In history, you can find many successful examples where great victories and important achievements come only by working together. I have no doubt that the cooperation between the fintech sector and the authorities will continue to be one of the successful examples of how a small country can become a market leader.
#Greta #Ranonytė #elections #whats #Fintech #sectors #expectations #government #Business
How is foreign investment influencing the local fintech landscape in Lithuania?
**Interview with Dr. Juras Karpavičius, Fintech Expert and Economic Analyst**
**Editor:** Thank you for joining us today, Dr. Karpavičius. The latest figures show significant growth in Lithuania’s electronic money and payment institutions sector. What do you attribute this growth to?
**Dr. Karpavičius:** Thank you for having me. Indeed, the sector’s growth—over 20% in the first half of the year—is a testament to Lithuania’s strategic positioning in the fintech landscape. This success is primarily due to a combination of a favorable regulatory environment, strong local talent, and increased foreign investment from major players like Revolut and Airwallex. The synergy between the fintech community and policymakers has been crucial in ensuring a coherent approach to development.
**Editor:** You mentioned foreign investments. How are these investments impacting local companies and the overall market?
**Dr. Karpavičius:** The influx of international firms has not only boosted local companies like TransferGo and NEO Finance but has also fostered a competitive environment that drives innovation. This surrounding vibrancy attracts even more investment, thus expanding the talent pool and improving services offered to consumers across the EU.
**Editor:** It’s encouraging to see that Lithuania has improved its ranking in the international tax competitiveness index. What role does the fintech sector play in this achievement?
**Dr. Karpavičius:** The fintech sector has been instrumental in this progress. By focusing on effective Anti-Money Laundering (AML) practices and proactively addressing compliance, fintech companies have enhanced Lithuania’s reputation. The increase in revenue from these firms also contributes significantly to the state budget, allowing for further public investment in infrastructure and social programs.
**Editor:** Looking ahead, what will be essential for maintaining this growth trajectory in Lithuania’s fintech sector?
**Dr. Karpavičius:** Continuity in fintech policy is critical. The incoming government must prioritize the implementation of the 2023-2028 development guidelines. Moreover, fostering collaboration among fintech firms, the Ministry of Finance, and the Ministry of Economy will help to create an attractive investment climate that supports sustainable growth.
**Editor:** And what about the education aspect? How can Lithuania ensure that its workforce is prepared for the evolving fintech landscape?
**Dr. Karpavičius:** Investing in education and skill development is vital. The Ministry of Education should focus on enhancing fintech-related curricula in higher education. This will ensure that students acquire relevant skills, preparing them for the high-demand jobs that fintech companies offer, not just in major cities, but also in regional areas.
**Editor:** what message would you like to share with the new Seimas members regarding the fintech sector?
**Dr. Karpavičius:** I urge them to actively involve market participants in crafting policies. Engaging with the fintech community will enable more effective decision-making and foster an environment conducive to growth and innovation, ultimately benefiting the entire economy.
**Editor:** Thank you, Dr. Karpavičius, for your insights on the positive trajectory of Lithuania’s fintech sector. We appreciate your time.
**Dr. Karpavičius:** Thank you for having me! I’m excited about the future of fintech in Lithuania.