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Why do small countries excel at fintech?

Lithuania aims to establish itself as a global fintech hub by 2028

July 26, 2024

4 min read

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July 26, 2024

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4 min read

Over the past decade, Lithuania has worked to shape itself into an attractive locale for fintech companies. In many areas, it has succeeded, ranking first in the EU in terms of the number of licensed fintech companies and being listed among the 10 lowest-risk jurisdictions worldwide.

But as a relatively small country, Lithuania faces some distinct challenges in its quest to become a universally recognised fintech hotspot by 2028, the goal outlined by its own Ministry of Finance.

This raises a crucial question: Can a small nation become a global fintech leader? And if so, how?

Small country, unique advantages

The rankings of the newly launched European Fintech Index suggest that smaller countries may in fact be uniquely positioned for fintech success, as the index shows nations like Estonia and Luxembourg ranking higher in key measures than their larger counterparts.

Estonia, for example, excels in the business and fintech sectors, ranking first and second respectively in Europe, due to its strong unicorn presence per capita and favourable regulatory frameworks.

Similarly, Luxembourg has established a reputation for its robust financial sector and holds the highest number of fintech deals per capita. These examples underscore how small nations can leverage agility, concentrated efforts, and supportive ecosystems to excel in the fintech arena.

“We’ve witnessed substantial progress in Lithuania,” says Marius Galdikas, CEO of ConnectPay, an all-in-one financial platform based in Vilnius. “A combination of innovation-focused policies and a supportive ecosystem has provided fintech companies with a suitable environment to operate efficiently and scale services across the EU.”

Looking ahead, several key factors are poised to play a major role in Lithuania’s aims for global recognition as a fintech hub.

Fast-track to a dynamic, collaborative market

One of Lithuania’s significant advantages lies in its streamlined processes for business registration and licensing, fostering fast-tracked entry for fintech firms. The country boasts swift licensing procedures that can be two-three times faster than those of other EU jurisdictions. This efficiency opens a path for fintech companies seeking faster market entry and operational expansion across the European Economic Area, possible through Lithuania’s passportable licenses.

For new market entrants, initiatives like the Newcomer Programme offer direct guidance from state authorities and the Bank of Lithuania during the setup phase, simplifying legislative and regulatory hurdles.

“The regulators at the Bank of Lithuania were welcoming and worked with us closely to ensure that we could meet the regulatory standards required to operate and complete the licensing process in a timely manner,” says Virgilijus Mirkės, country manager for Lithuania at Airwallex, a global payment and financial platform that opened an operational/service hub in Lithuania in 2023.

There are also several non-bank organisations, like Fintech Hub LT, Rockit, and Unicorns Lithuania, that facilitate ongoing collaboration, innovation, and growth among fintechs operating in the country.

Knowledge is Lithuania’s IT power

Lithuania presents its talent pool as one of the strongest assets. The country places a strong emphasis on STEM (Science, Technology, Engineering, and Mathematics) education, producing a skilled, multilingual workforce equipped for the fintech industry.

According to Mirkės, the availability of talent was a crucial element when choosing an operational hub. While around 2,000 IT students graduate from local universities each year, an even more significant addition comes from retraining and upskilling programmes, which produce around 2,500 new IT specialists annually.

Additionally, over 95 per cent of the working-age population speaks one or more foreign languages, which directly facilitates their integration into international companies.

In the latest, 2023 edition of the IT Competitiveness Index, compiled by Emerging Europe, Lithuania and Estonia took the first two places among the 23 countries ranked.

High quality of life without the high costs

Finally, Lithuania aims to offer an appealing quality of life, balancing professional ambitions with personal well-being. Ranked 11th for work-life balance among OECD countries, Lithuania is known for its rich culture, safe environment, and abundant green spaces.

Its capital city, Vilnius, was named European Green Capital for 2025.

“The quality of life here directly complements the business environment,” says Galdikas. “Professionals can enjoy a rewarding work-life balance, leading to better creative thinking and greater overall productivity.”

A recent study by fDi Intelligence also recognised Lithuanian cities as some of the most cost-effective mid-to-small-sized cities in the world, positioning Lithuania as an affordable, yet high-quality operational environment for businesses in the fintech sector.

The combination of these factors can paint Lithuania in a positive light, as it strives to achieve its ambitions of becoming a global fintech hub.

Whether it can fully realise this goal remains to be seen, but its current trajectory shows promising signs.

Marek Grzegorczyk

Marek Grzegorczyk

Marek Grzegorczyk is an analyst at Reinvantage.

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1. The Client

A global technology company operating across EMEA, with a regional HQ in Istanbul. The company manages 20+ markets, handling everything from brand campaigns to strategic partnerships.

Role we worked with: The EMEA Head of Marketing (supported by two regional managers).

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Traditional fixes (more meetings, more reporting) only created more noise.

3. The Sprint

We ran a 10-day Remote Reinvention Sprint with the regional HQ team.

  • Day 1–3: Intake → Reviewed decks, campaign data, and plans.
  • Day 4: Sprint Session (90 mins) → Breakthroughs:
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    • 40% of spend was going into low-potential markets.
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4. The Breakthrough

The Sprint uncovered that the issue wasn’t budget, but fragmentation.
Three sharp insights unlocked a way forward:

  1. Unified KPIs bridging marketing + sales.
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By just realigning resources and focus, the client could unlock an estimated £250,000 in efficiency gains within the next 12 months — far exceeding the Sprint’s value guarantee. The path to higher returns was already inside the business, hidden by misalignment.
5. From Sprint to Action (4 Pillars Applied)

With clarity secured, Reinvantage didn’t suggest “more projects.”

Instead, we used the Sprint findings to create laser-focused next steps — drawing only from the areas that would deliver the most impact:

  • Readiness → Alignment workshops for sales + marketing teams. New playbooks clarified “qualified lead” definitions and reduced internal disputes.
  • Foresight → A market-opportunity scan identified which 5 countries would deliver the highest ROI, removing the guesswork from allocation.
  • Growth → Guided the reallocation of €2M budget and designed a phased rollout strategy that protected risk while maximising return.
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Because the Sprint had stripped away noise, these actions weren’t generic consulting ideas — they were directly tied to the breakthroughs.

6. The Results
  • +28% increase in qualified leads across the region.
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  • Budget efficiency gains → €2M redirected from low-return to high-potential markets.
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The client came in believing they needed more budget.
The Sprint revealed that what they really needed was clarity and alignment.

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The Sprint guaranteed at least £20,000 in value — but in this case, it helped unlock more than 10x that within six months.
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1. The Client

A regional venture capital fund and accelerator focused on early-stage tech start-ups in the Baltics and Central Europe.

The fund had raised a new round and was under pressure to deliver stronger returns while also building its reputation as the go-to platform for founders.

Role we worked with: Managing Partner, supported by the Head of Portfolio Development.

2. The Challenge

Despite a promising portfolio, results were uneven.

Key issues:

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The leadership team knew something was off, but disagreed on whether the issue was pipeline quality, market conditions, or internal capacity.

3. The Sprint

We ran a 10-day Remote Reinvention Sprint with the partners and portfolio team.

  • Day 1–3: Intake → Reviewed pitch decks, pipeline funnel data, and start-up performance reports.
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4. The Breakthrough

The Sprint revealed that the challenge wasn’t pipeline quality — it was lack of focus and positioning.

Three core insights provided the turning point:

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These shifts alone gave the fund a path to add an estimated £2M+ in portfolio value over the following 18 months, by concentrating capital and resources where they could move the needle most.
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With clarity from the Sprint, Reinvantage created a tailored support plan:

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6. The Results
  • 10 portfolio companies onboarded to the new Playbook → greater consistency of support.
  • Raised follow-on capital for 3 top start-ups with the new prioritisation framework.
  • +26% increase in inbound deal flow from founders citing the fund’s new positioning.
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The client thought the problem was pipeline quality.
The Sprint showed it was actually lack of clarity and focus inside the firm.

By applying the four pillars, Reinvantage helped turn scattered effort into concentrated value creation.

The Sprint guaranteed at least £20,000 in value; here it set the stage for multi-million-pound upside in portfolio growth.
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1. The Client

A large international impact organisation focused on entrepreneurship and economic empowerment.
The organisation runs multi-country programmes across Eastern Europe and Central Asia, often in partnership with global donors and corporate sponsors.

Role we worked with: Senior Programme Director, responsible for regional coordination.

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The organisation had launched a flagship regional initiative supporting women entrepreneurs, but the programme was underperforming.

Key issues:

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We ran a 10-day Remote Reinvention Sprint with the regional leadership team and representatives from two country offices.

  • Day 1–3: Intake → Reviewed donor reports, programme KPIs, and field feedback.
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Three critical insights reshaped the path forward:

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By eliminating duplicated reporting and clarifying what success looks like, the client saw they could save the equivalent of £100,000 in staff time annually — while also unlocking stronger donor confidence and follow-on funding opportunities.
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Armed with Sprint clarity, Reinvantage proposed a laser-focused support plan:

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1. The Client

A national digital development agency tasked with driving the government’s digital transformation agenda, including e-services, citizen portals, and smart city pilots.

Role we worked with: Director of Digital Transformation, supported by IT and service delivery leads from three ministries.

2. The Challenge

The agency had strong political backing but faced hurdles in implementation.

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  • Funding pressure → international partners demanded clearer impact in the short term.

The agency wanted to accelerate momentum but struggled to get alignment across ministries.

3. The Sprint

We ran a 14-day Immersive Reinvention Sprint with the agency’s leadership and digital focal points from three ministries.

  • Day 1–3: Intake → Reviewed strategy docs, donor reports, and citizen feedback data.
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The Sprint revealed that the biggest blocker wasn’t lack of funding, but lack of shared priorities.

Three practical insights stood out:

  1. One Definition of Digital Service → agreed across ministries.
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5. From Sprint to Action (4 Pillars Applied)

Based on the Sprint clarity, Reinvantage proposed a modest, targeted package of support:

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6. The Results
  • 2 pilot services integrated into the central portal (ID renewal + healthcare booking).
  • Budget savings of £75,000 from eliminating overlapping projects.
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  • Donor confidence improved → short-term impact report received positive feedback.
The client thought it needed more funding and bigger projects.
The Sprint revealed it first needed clarity and alignment.

By applying the four pillars to a targeted scope, Reinvantage helped deliver visible results within a single quarter — proving progress to citizens and donors and laying the groundwork for deeper transformation.