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Minister of Finance G. Skaistė: “Further Development of the Fintech Sector Needs to Be More Focused on Quality Rather Than Quantity”

Date

2021 05 21

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Today’s meeting of the Advisory Commission on Financial Markets Policy Formation focused on the long-term perspective of the financial technology (fintech) sector and risk management.

At the meeting the stress was made that in recent several years Lithuania succeeded to reach the breakthrough in the fintech sector, therefore, it is natural that risk volumes increase alongside with the increasing number of companies. Despite that, the assessments show that Lithuania is among the least risky jurisdictions in the world with regard to money laundering risk, e.g. Lithuania ranks 11 in the Basel Institute on Governance AML index rating.

Minister of Finance Gintarė Skaistė also notes that risk management development is a continuous process, especially considering rapidly changing fintech sector. The ambition to become a leading country in the field of prevention of money laundering and terrorist financing was also discussed at the meeting. It is also planned to prepare a five-year fintech development perspective this year by focusing more on access to services.

At the meeting of the Commission Ms G. Skaistė stressed that the basic goal of fintech today should be to increase competition in the concentrated financial sector of Lithuania by creating benefits for the residents and companies of the country, paying particular attention to risk management. Indeed, there is a trend that fintech companies established in our country provide few services on the Lithuanian market.

“With growth in the fintech sector of Lithuania and emerging new business models, it is necessary to prepare a strategy for the fintech sector which would be oriented towards quality rather than quantity. We must not only be a gateway to Europe, but also pay attention to what our country needs – access to services for the Lithuanian residents and businesses as an alternative to financial services provided by traditional market players," said the Minister of Finance.

The Minister also stated that in parallel to active attracting of necessary service providers, the competences of specialists in the field of prevention of money laundering and terrorist financing in fintech companies should be further strengthened, and, if necessary, to consider the need to embed the requirements in legal acts. 

“In order to manage risks, it is also important to strengthen resources and competences in supervisory institutions. Therefore, we will allocate an additional EUR 100 thousand to the Financial Crime Investigation Service (FCIS) during the budget review process for research jobs, software and training,” said Ms G. Skaistė.

“In the context of increasing number of companies operating in the fintech sector of Lithuania and the focus of the Bank of Lithuania on increasing maturity of this sector, we will devote even more attention to risk management. In creating added value for consumers of financial services and financial market players, we will use supervisory innovations, RegTech solutions focused on reporting and submission of applications, and in the future we will also use artificial intelligence solutions for greater automation of supervisory processes,” said Chairman of the Board of the Bank of Lithuania Gediminas Šimkus.

Note that Article 48 of the Republic of Lithuania Law on Financial Institutions provides for that the Advisory Commission on Financial Markets Policy Formation delivers advice to the Minister of Finance on financial markets policy formation issues and monitors the implementation of the financial markets policies, which consists of: the Minister of Finance (Chairman of the Commission); Vice-Minister of Finance responsible for the financial market; Chairman of the Board of the Bank of Lithuania; Head of the division responsible for the supervision of the financial market of the Bank of Lithuania.