paynearby Ecommerce Covid-19 Digital Retail
Challenger Banks Europe Fintech Open Finance Paytech

What Is the Baltics’ eCommerce Dilemma and How Can It Be Solved?

During 2020, eCommerce experienced a significant worldwide surge, as online retail demonstrated a 27.6% growth rate; with sales topping the $4 trillion mark. This upward trajectory is currently showing no signs of fatigue – by 2023 global e-commerce is predicted to be worth $6.5 trillion; a 22% increase from previous 2022 estimates.

The Baltics are no exception to this phenomenon. Lithuania’s e-commerce revenue is projected to reach $889 million in 2021, while Latvia and Estonia are expected to reach $345 million and $405 million respectively.

A byproduct of this continuing e-commerce boom, however, is the stark reminder of one of the sector’s most prominent issues – current LPM (local payment method) options do not reflect the needs of global merchants, thus limiting access for both them and their potential consumers.

The Baltics have not dodged the bullet in this regard. More than 65% of Baltic shoppers have a preference for paying through online banking, which has predictably become the dominant payment method in the region.

Despite this preference, and rather alarmingly, only around 20% of the region’s citizens currently hold a credit card – roughly 17% of Lithuanians and Latvians, and 29% of Estonians – bringing limitations to consumers in terms of shopping on international e-commerce platforms; as well as restricting market access for international merchants.

An estimated 60% of Europeans tend to abandon their shopping cart if they cannot pay via their favourite payment method. In addition, global payment providers which service the Baltic states, are often unaware of the market needs, offering access only to a small traditional and challenger bank network.

How can this issue be overcome?

One promising avenue by which to address this issue is to offer an innovative, cultivated payment method, specifically tailored for the needs and wants of the region. A solution that would be able to connect global merchants to the Baltics market in a seamless manner.

Nikulipe, a fintech company creating and connecting LPMs to access emerging and fast-growing markets, has undertaken the issue that the Baltics are currently facing. They’re hoping that their latest product – banklinq – with provide a solution to this issue.

By combining local knowledge and global experience, banklinq arrives as an LPM solution with the specific intention of addressing regional complexities, helping international merchants become more familiar with and trusted by local shoppers, paving the way to access new user markets.

Frank Breuss, CEO, Nikulipe
Frank Breuss, CEO, Nikulipe

“By connecting the largest number of local financial institutions in Lithuania, Latvia, and Estonia, including major traditional and challenger banks, we are easing the access for international merchants that are looking to expand their businesses and reach new customers, but are limited by regional intricacies, like regulatory processes,” explains Frank Breuss, CEO and co-founder of Nikulipe. “Incorporating region-specific payment solutions puts businesses one step ahead in the game as the local knowledge goes a long way with customers, who are used to certain ways of paying for goods and services.”

Built upon open banking and adhering to EU regulations, banklinq will offer a payment option that covers all relevant banks in the region, bringing the Baltic consumers to global merchants. One convenient API ensures an efficient market entry without being caught up in technicalities, as the local regulatory landscape, processing, collection, reconciliation, settlement, remittance and other processes will be navigated by the banklinq in-house team.

“The Baltics is one of the fastest-growing e-commerce markets in Europe, contributing to the worldwide e-commerce growth rate of 26% last year,” observes Breuss. “This growth is attracting a number of new businesses to the region, but the current Local Payment Methods are, unfortunately, not fit for international merchants and make it more difficult for them to access the market. We want to change that.”

The growth that global e-commerce continues to experience is, in turn, resurfacing some of the more rooted issues in Local Payment Methods that have yet to be addressed. The Baltics are no exception in this regard, yet a region-specific solution like banklinq could remedy the limited access international merchants and consumers in Lithuania, Latvia and Estonia are currently facing.


  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

Related posts

Fintech in 2023: Predictions From Enfuce, Dreams, DivideBuy, Xero

The Fintech Times

ShuttleOne to Build DeFi Blockchain Solution for SME Lending and Remittance Market

Polly Jean Harrison

What Is the Top Priority for Firms Looking To Offer Cross-Border Payments?

Francis Bignell