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Fintech Growth Continued Across Lithuania Throughout 2023, Despite Global Economic Downturn

Lithuania, the EU’s largest fintech hub by the number of licences issued, enjoyed another year of steady progress despite the continuing global economic downturn. A new report by Invest Lithuania, the country’s free-of-charge consultancy service provider, reveals that in 2023 Lithuania saw a rise in the number of fintech companies and specialists.

As much of the global tech industry was left rocked by difficult macroeconomic conditions throughout 2023, Lithuania’s fintech ecosystem enjoyed continued growth – driven by efforts and initiatives targeting the space throughout the last decade.

The number of fintechs operating in Lithuania surpassed 270 for the first time, continuing a steady upward trend. The likes of Hokodo, Payhawk, Windcave, and innovation platform and accelerator Plug and Play joined the country’s fintech landscape in 2023.

Hristo Borisov, CEO at Payhawk, explained why the spend management solution provider had opted to expand to the country: “Payhawk chose Lithuania to open our latest office, largely due to its extensive experience in supporting fintechs. This choice was reinforced by our positive licensing experience and constructive interactions with the Bank of Lithuania.”

As a result, fintech employment figures also continued to rise, with the sector’s talent pool expanding by nearly six per cent to over 7,400 professionals.

Unlike many other world regions, the sector also showed notable progress in terms of gender parity. Across 77 Lithuania-based fintechs that participated in Invest Lithuania’s yearly survey, women made up 45 per cent of the overall workforce and 43 per cent of executive positions. In technical roles, women accounted for 25 per cent of the workforce, a figure that ranks among the best in terms of female representation in the ICT industry across Europe.

Crowdfunding and virtual asset growth 

In 2023, Lithuania continued to embrace promising fintech subsectors, including blockchain and crowdfunding. The recent introduction of Europe-wide crowdfunding regulation saw the country’s financial regulator, the Bank of Lithuania, swiftly making the necessary adjustments, helping Lithuania become one of the top three countries for licenced crowdfunding service providers in the EU.

Blockchain and cryptocurrency-focused fintechs in Lithuania also rose from eight per cent in 2022 to 13 per cent in 2023.

In line with this growth, Lithuania also aims to become a leader in embracing the EU’s upcoming Markets in Crypto Assets (MiCA) regulation. Known for its proactive regulatory stance in financial technology, the country is keen to welcome MiCA-compliant crypto companies ready to prioritise and invest in anti-money laundering and counter-terrorism financing (AML/CTF) functions.

Rosvaldas Krušna, advisor to a board member of the Bank of Lithuania, commented: “Under the new regulations, the Bank of Lithuania will be responsible for licensing crypto companies. We feel rather well prepared to ensure that access to the market is granted only to those applicants that are able to prove their maturity and commitment to compliance, with particular attention to the AML/CTF area.”

Lithuania’s fintech future looks promising

An agile attitude towards fintech has enabled Lithuania to build a stable and increasingly mature fintech sector. Invest Lithuania’s survey suggests that financial self-sufficiency is one of the factors underpinning this stability. Thirty-nine per cent of fintech firms primarily rely on revenue funding, suggesting a preference for sustainable growth models.

As Invest Lithuania data shows, the outlook for fintech in Lithuania this year is promising. A remarkable 75 per cent of surveyed Lithuanian fintechs anticipate consistent revenue growth in 2024, and over 30 per cent foresee their revenues at least doubling.

“We view Lithuania as a crucial hub for fostering fintech development, both on a regional and global scale,” explained Dmitrij Sosunov, partner at early-stage VC fund and startup accelerator FIRSTPICK. “Our current focus lies on watching the ongoing modernisation efforts in financial services across enterprises and traditional banks.

“Identifying current infrastructure shortcomings as a primary limiting factor to industry advancement, we recognise the moment for B2B infrastructure-centric fintech companies to emerge, particularly those specialising in regulatory technology (regtech) and payments. There’s definitely enough entrepreneurial spirit, talent and institutional determination to make things happen.”


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