Fintech study : Latvia 2020

Abstract

The term “FinTech” is now fashionable all over the world. FinTech is seen as a market integrating finance and technology (Arner, Barberis & Buckley, 2015), whereby traditional financial services are replaced with new technology-based processes. FinTech is associated with mobile applications, social networks, machine learning, distributed ledger technology, cloud computing, big data analytics and artificial intelligence, which increased access to financial products and services while raising new risks to financial stability and integrity. The spread of FinTech technologies can be seen largely in the emergence of FinTech hubs - cities where start-ups, talents and funding are concentrating. While centres such as London, New York, and Silicon Valley are widely recognised as dominant FinTech hubs, other centres/countries are interested to become if not global then at least regional hubs of this fast-growing market. For instance, Australia, Switzerland, and China are showing good progress in recognising their financial centres of Sydney, Zurich, and Shanghai, as global market players. Also, some emerging markets (including Brazil), Israel, and Canada are expected to play a larger role in the global FinTech ecosystem in the future. Besides, smaller countries such as Lithuania, Estonia, Latvia, Malta, Belarus, Gibraltar, Luxembourg are competing for the role of international regional hubs. This study provides an overview of the current state and the developments in the Latvian FinTech environment. This is also the first attempt of the research team at the Faculty of Business, Management and Economics of the University of Latvia to explore the Latvian FinTech landscape and increase the visibility of Latvian FinTechs and is part of a larger European survey targeting FinTechs in Eastern Europe.