The ascent of Lithuania as the fintech hub of Europe


Lithuania, one of the three Baltic states in Eastern Europe, has emerged as a leading fintech hub globally. Despite its small population of just 2.8 million, it is now one of the most prominent fintech destinations in Europe, ranking second in the region and fourth worldwide. Recent statistics show a 24% increase in the number of fintech companies in Lithuania over the past year, with the number of jobs in the sector growing by over 30%.

Currently, approximately 270 fintech companies in Lithuania employ around 7,000 people. This rapid growth is primarily due to the sustained efforts of the Lithuanian government to create a supportive environment for fintech companies, considering them a top priority. The transformation has also been fueled by a robust collaboration between the government, the country’s banks, and various private firms, with the Bank of Lithuania playing a crucial regulatory role. The nation has adopted legislation aimed at fostering a fintech culture aligned with market needs, further driving sector growth. There is close cooperation between the central bank, the Agency for Science and Innovation, and the BCCS Cluster, a consortium that supports IT businesses and creates meaningful relationships between stakeholders.

5-Year Fintech Strategy

Lithuania recently unveiled a new 2023-2028 Fintech Strategy to solidify its position as Europe’s fintech hub. The strategy aims to:

  • Support qualitative development of the fintech sector
  • Attract innovative fintech solutions
  • Establish Lithuania as a center of excellence for fintech
  • Ensure the country is a safe and reliable jurisdiction
  • Achieve universal recognition as a European fintech hub

The strategy includes performance indicators to ensure progress, such as facilitating a 30% annual fintech revenue growth rate, serving at least 35 million fintech clients, and reducing the number of fintech companies facing talent shortages to 30%, down from 62%.

Government Initiatives

The Lithuanian government has implemented several initiatives to support fintech growth, such as simplifying migration procedures for foreign professionals and encouraging cooperation between supervisory authorities and the entities they oversee. The government aims to create a unified ecosystem characterized by cooperation and mutual communication within the sector. Key organizations, including the Fintech Hub LT Association, Invest in Lithuania, the Bank of Lithuania, the Ministry of Finance, and major fintech companies, work together to address industry challenges.

Fintech is a strategic priority for the Lithuanian government, which has adopted a flat 15% corporate tax rate, one of the lowest in Europe. The country boasts a highly developed digital infrastructure, a growing pool of professionals with digital skills, and supportive employment laws that facilitate the hiring of foreign talent. The government also supports startups through investment funds, grants, and acceleration programs, with crowdfunding and venture capital funding options available for fintech companies.

Advantages for Fintech Companies

Key features of Lithuania’s financial services regime that encourage fintech growth include:

  • The ability to apply online and obtain an electronic banking license within about three months, compared to a minimum of 12 months in other EU countries.
  • Over 50% of fintechs in Lithuania are licensed as electronic money institutions, payment institutions, or specialized banks, the highest rate in the EU.
  • Transparent regulations governing the financial services sector.
  • Lithuania ranks eighth lowest in financial risk for money laundering worldwide.
  • A Center of Excellence dedicated to refining anti-money laundering (AML) legislation.

According to a recent Business Service Report by Invest Lithuania, Vilnius, Lithuania’s capital, has gained significant recognition as a tech powerhouse over the past decade. Notable companies such as Revolut, Unity, Vinted, and Nord Security have established themselves in the city, enhancing its reputation in the tech industry.

Top 10 Fintech Companies in Lithuania

  1. DappRadar – A platform for discovering and analyzing blockchain-based decentralized applications.
  2. Interactio – A mobile app-based live translation solution.
  3. Ondato – A tech enterprise handling KYC and AML-related processes.
  4. Paysera – Offers banking channels and issuer processing solutions.
  5. PeerBerry – An alternative investment platform focused on secondary market investments.
  6. Bankera – Aims to become a fully functional banking service provider operating on Blockchain.
  7. W1TTY – A mobile-based platform providing digital payment solutions.
  8. WhiteBIT – A cryptocurrency exchange and trading platform.
  9. HeavyFinance – An online lending P2P marketplace for farm loans.
  10. kevin – Provides payment infrastructure for online and physical sales.

Lithuania’s strategic efforts and supportive environment have propelled it to the forefront of the global fintech landscape, setting new standards for efficiency and innovation in the sector.