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 located 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 this 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 the opportunity 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 Lithuania addressing money laundering risks within its fintech industry, according to Dr. Karpis?
**Interview with Dr. Jonas Karpis, Fintech Expert and CEO of Fintech Innovations Lithuania**
**Interviewer:** Thank you for joining us today, Dr. Karpis. It’s exciting to see the growth in Lithuania’s fintech sector. Can you give us an overview of the current state of electronic money and payment institutions in Lithuania?
**Dr. Karpis:** Thank you for having me. Indeed, the Lithuanian fintech sector is experiencing significant growth. In the first half of this year alone, the revenue from electronic money and payment institutions rose by over 20%, reaching €275.1 million. We’ve also seen payment transactions surge by more than a third, nearly hitting 132 billion euros. It’s estimated that around 27 million customers across the EU are utilizing services from Lithuanian companies, which speaks volumes about our sector’s potential.
**Interviewer:** That’s impressive! What do you think has contributed to this rapid growth?
**Dr. Karpis:** Several factors have played a crucial role. Firstly, Lithuania has successfully positioned itself as an attractive destination for international investors. The arrival of major players like Revolut and Airwallex has not only reinforced our attractiveness but has also stimulated local companies like TransferGo and Paysera. Moreover, our ranking has improved in the international tax competitiveness index, rising from seventh to fifth place, demonstrating our commitment to fostering a conducive business environment.
**Interviewer:** You mentioned money laundering and risk management. How is Lithuania addressing these issues within the fintech sector?
**Dr. Karpis:** That’s a great question. Lithuania was recognized among the top 10 countries with the lowest money laundering risks. Our authorities, together with fintech companies, have focused on robust AML strategies. Investments in human resource capabilities and the implementation of advanced technology for AML compliance have significantly improved our standing in this regard. The MONEYVAL committee has commended our progress, indicating a collaborative effort between the government and fintech operators.
**Interviewer:** Absolutely. Considering the rapid growth of fintech globally, how do you envision the future of Lithuania’s fintech landscape?
**Dr. Karpis:** The global fintech market is anticipated to reach around €300 billion by the end of this year and continue expanding at around 14% per year, potentially hitting €600 billion by 2029. Lithuania can capitalize on this trend, but we must maintain continuity in our fintech policies. After three elections this year, it’s essential that we have a stable regulatory environment. The new government needs to focus on collaborative efforts between market participants and policymakers to sustain this momentum.
**Interviewer:** That sounds critical for future growth. Do you have any recommendations for the new government to ensure continued success in the fintech sector?
**Dr. Karpis:** Certainly. The new government should prioritize the implementation of the 2023-2028 guidelines for the fintech sector, which emphasize collaboration among stakeholders. Additionally, the Ministry of Economy and Innovation should enhance the investment environment further, while the Ministry of Education must focus on equipping the youth with the necessary skills to thrive in this sector. We need a workforce that is not only knowledgeable but also prepared for the expanding opportunities in fintech.
**Interviewer:** Thank you, Dr. Karpis, for sharing your insights. It’s clear that Lithuania has a vibrant fintech ecosystem, and we look forward to seeing how it evolves in the coming years.
**Dr. Karpis:** Thank you for having me. I’m optimistic about the future of fintech in Lithuania, and I’m excited to see how we can create more value and opportunities for our citizens.