Last year, the Lithuanian fintech sector grew by 40 companies, the number of employees grew by a fifth. Deal

Last year, 40 new ones were registered in Lithuania Fintech companies, their total number reached 230. At the end of the year, the sector employed 4,000 people, which is 18 percent. more than at the end of 2019.

In a study presented Thursday,Fintech Landscape 2021 and Rockit Fintech Map 2021, developed by the Rockit Center for Financial Technologies and Sustainable Innovation, also lacked optimistic information.

59 percent. interviewed fintech the companies said the number of clients increased last year. Also, 87 percent. Business revenue increased, almost a third hired new employees and 28 percent introduced new products or services precisely because of the Covid-19 pandemic. surveyed.

The year 2020 was also marked by a significant increase in cooperation between startups, up to 75 percent. fintech the companies have formed alliances with colleagues in the industry. Furthermore, up to 70% started new activities with Lithuanian and foreign banks. surveyed companies.

According to the head of the Invest in Lithuania technology sector team, Gintarė Bačiulienė, stable growth of the fintech sector was expected early last year, but after a few months, companies had to urgently look for new ways of doing business and business. opportunities.

“The financial technology sector is young and growing fast. As a result, its strengths are agility and flexibility. This is for the majority. fintech It enabled companies to withstand challenges, react quickly to the situation, respond to increased demand for digital services at the end of the year and successfully overcome the wavy 2020s, ”said G. Bačiulienė.

Open banking and digital currencies can open up more opportunities

2020 to development in Lithuania fintech new names such as Mambu, Demivold, DiPocket, Nikulipe, HeavyFinance and other start-ups have entered the sector.

Of the 230 startups located in Lithuania, 30 percent. participate in payments, 20 percent. develops software for finance, 13 percent. they are loan companies, 9 percent. – digital banks. Financial software was the fastest growing last year, while the payments sector’s share decreased.

63 percent. Located in Lithuania fintech Start-ups also have their headquarters here, it is true that 15%. of which are foreign-owned companies. 13 percent fintech The start-up headquarters are in other EU countries, the remaining 24%. – start-up of non-EU resident companies.

Lithuania is the most popular among UK companies, with 11% of new companies. local fintech communities, another 8 percent. add Nordic companies.

In a survey presented by Invest in Lithuania, respondents were also asked to identify the biggest challenges facing the sector this year. Product development prospects, international expansion and attracting the right talent were some of the most frequently mentioned aspects.

On the other hand, market players also see many opportunities this year. In his opinion, further expansion of open banking can help achieve higher growth rates. Instant payments and digital currencies are also among the factors that will have a value in 2021. It may increase.

Fintech the crisis in the sector has hardly affected

The data shows that fintech the sector weathered the Covid-19 pandemic better than other industries. According to the institutions, the reason for this was the favorable legal environment, the leadership of the Bank of Lithuania and the community spirit.

One of the key factors in the success of the financial technology sector has been the increase in the number of digital projects since the end of the second quarter of last year and the faster implementation of the solutions in practice. Higher online sales, requiring new products and management services, were particularly influential.

Fintech The companies also helped the state distribute the support provided to companies affected by the pandemic. For example, fintech Sector decisions have helped accelerate access to state-guaranteed loans for small and medium-sized enterprises.

Additionally, the need for a digital user authorization service has emerged in several areas during the quarantine. Fintech Products and services developed by companies have also been adapted in the healthcare field, for example to register for a visit or consultation with a doctor by phone, to contact hospital staff.

Marius Jurgilas, a member of the Board of Directors of the Bank of Lithuania, said that excess liquidity and the adequate policy of state institutions last year allowed the sector to grow.

“The EU is united on this issue fintech one of the priorities on your agenda, complementing the European payments strategy. Also, the European Central Bank is actively working on the digital euro if we decide to issue it at some point. There is strong political pressure for it to be published as soon as possible, but we must look at it carefully and not rush, “he said.

A strong ecosystem and new partnership opportunities

The past year saw a particularly high number of new payment company-lender partnerships. Fast ordering, information processing, security and digital identification have led fintech business people to create more joint projects than ever.

Šarūnė Smalakytė, Director of the Rockit Center for Financial Technologies and Sustainable Innovation, says that after several years of intensive development, it is now possible to say fintech maturity of the sector.

“For joint projects fintech companies are simply programmed and the circumstances that have arisen have only accelerated them. For example, last year a member of the Rockit Center Ondato formed more than 6 partnerships with other companies. In this way, many more and more diverse relevant products were developed last year. In turn, fintech The market has clearly shown that it is ready for any challenge and opportunity when it is important to create quality products at a record pace, ”Šmalakytė said.

It also became one of the biggest breakthroughs of the past year. fintech business cooperation with banks. The study showed that in 2020, 70 percent. surveyed fintech companies have formed at least one or two partnerships with banks.

The study authors conclude that last year Lithuania fintech companies quickly adapted to the conditions dictated by COVID-19, took the initiative and seized the opportunities. The digitization process has become even more relevant, allowing future partnerships and development, which will have a positive impact on the entire Lithuanian economy.