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How Lithuania Strengthens its Reputation as a Fintech Hub?
Remarkable developments mark the domain of fintech in Lithuania, making it a preferred destination for startups.
FREMONT, CA: Lithuania’s efforts towards promoting its fintech industry has paid rich dividends and has now made it Europe’s second-largest hub for fintech startups. The journey, which started a few years ago with a host of policy initiatives, has been resulting in a dynamic ecosystem that incentivises and nurtures fintech companies. Even the regulatory domain in Lithuania plays a role in bringing about the fintech revolution.
Over the last couple of years, the number of fintech companies in Lithuania has grown rapidly. From 117 in 2017, the number increased to 170 within a year. In 2019 as well, the number of fintech companies increased by 24 per cent to reach a total of 210. These insights from published reports also forecast a good 2020 that will see the establishment of new fintech startups and the creation of new jobs. The expansion is also expected to be accompanied by diversification and sophistication of fintech offerings.
The favourable climate that Lithuania has been able to provide for fintech companies is a direct result of its multi-pronged proactive approach. Once it recognised the potential for becoming a fintech hub, it passed several regulations and eased the terms of business for financial technology companies. Compared to elsewhere in Europe, getting banking licence for fintech is easier in Lithuania. Besides, companies can apply remotely and get the permits within a few months. In other European regions, licence preparation takes much longer. The Sandbox Regime that Lithuania has developed to test fintech solutions has also been highly successful. Even the minimum capital limit for starting or diversifying into fintech is much lower than the rest of Europe. Lithuania's pool of talent could be a major factor in painting the region's fintech success story.
Apart from offering fintech-friendly grounds for local companies, Lithuania has welcomed non-EU startups. In the process, it has earned the reputation of being a favourable entry point into Europe for such fintech companies. The liberal approach, in combination with all the other discussed factors, has made Lithuania the perfect place for the success of fintech startups and a leading fintech hub.
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