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 may reach almost 600 billion by 2029. 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
What are the key factors driving the growth of Lithuania’s fintech sector?
**Interview with Dr. Aiste Kavaliauskiene, Fintech Analyst and Economic Advisor**
**Interviewer:** Thank you for joining us, Dr. Kavaliauskiene. The recent growth in Lithuania’s electronic money and payment institutions sector has been remarkable. Could you elaborate on the key factors driving this growth?
**Dr. Kavaliauskiene:** Thank you for having me. Indeed, Lithuania’s fintech sector has seen stellar growth, with a reported increase of over 20% in income during the first half of the year. Key factors include our favorable regulatory environment, active government policies that promote investment, and our strategic geographical position within the EU. The arrival of major international players like Revolut and Airwallex has also bolstered local companies and overall market confidence.
**Interviewer:** The Bank of Lithuania reported significant increases in both sector revenue and payment transactions. What does this mean for the everyday consumer and the economy at large?
**Dr. Kavaliauskiene:** The increase in revenue, reaching 275.1 million EUR, and the dramatic rise in payment transactions—almost to 132 billion EUR—signals that many consumers across the EU are turning to Lithuanian fintech companies for their financial needs. This not only indicates a trust in our local services but also enhances Lithuania’s reputation as a fintech hub, ultimately stimulating economic activity and job creation.
**Interviewer:** Lithuania’s fintech sector has achieved a high ranking in terms of tax competitiveness. What role does this play in attracting foreign investment?
**Dr. Kavaliauskiene:** A strong tax competitiveness index, now at fifth place globally, is crucial for attracting foreign investments. It demonstrates to international companies that Lithuania is a welcoming environment for business with efficient tax structures. This is especially important for startups and established firms looking to maximize their profits while contributing to local economies.
**Interviewer:** The sector also emphasizes compliance with anti-money laundering (AML) measures. How have fintech companies contributed to improving Lithuania’s standing in this area?
**Dr. Kavaliauskiene:** Fintech companies have been proactive in enhancing their AML risk assessment and management strategies. With Lithuania recognized among the top 10 countries with the lowest AML risk, the contributions of market participants are evident. By investing in technology and human resources, they’re strengthening our financial system, thus increasing international confidence in Lithuania’s regulatory framework.
**Interviewer:** The future projections for the global fintech market look promising. What can be done to ensure Lithuania capitalizes on these trends?
**Dr. Kavaliauskiene:** Continuity in policymaking is essential for maintaining growth. The new government must focus on the 2023-2028 development guidelines for the fintech sector and engage continuously with businesses. Collaboration between different ministries, such as Finance and Education, will be crucial to creating a skilled workforce ready to meet the demands of this evolving market.
**Interviewer:** what message would you like to send to the newly elected members of the Seimas regarding the fintech sector?
**Dr. Kavaliauskiene:** I urge them to prioritize sustained cooperation with market participants and to cultivate a conducive investment environment. By focusing on education and optimizing regulations, they can help foster innovation while ensuring that Lithuania remains a competitive player in the European fintech landscape. This commitment will ultimately benefit all citizens through enhanced job opportunities and economic growth.
**Interviewer:** Thank you, Dr. Kavaliauskiene, for sharing your insights on Lithuania’s vibrant fintech sector. It will be exciting to see how it continues to evolve.
**Dr. Kavaliauskiene:** Thank you for having me! I look forward to witnessing the continued growth and success of our fintech industry.