How Lithuania Became a Fintech Leader (Without Shouting About It)

When Britain left the European Union in 2020, it created a silent earthquake in the European fintech sector. Passporting rights evaporated. London’s dominance, once unshakable, began to blur. Amid the regulatory recalibration, one small Baltic country quietly emerged as the unlikely safe harbour for displaced financial innovators: Lithuania.

A Fintech Hub by Design

Few outside of regulatory circles had paid much attention to Lithuania’s financial infrastructure. Yet by the time Brexit was complete, Lithuania had already positioned itself to become a magnet for financial technology firms seeking a stable, EU-based jurisdiction.

“It didn’t happen by accident,” says Edgars Lasmanis, founder of WALLETTO, a Lithuanian-based electronic money institution that operates across the European Economic Area (EEA). “The government, the Bank of Lithuania, and the private sector worked together to create an ecosystem — fast, digital, and friendly to innovation. We got our license, plugged into Visa and Mastercard, and were operational before many of our competitors even figured out where to go.” WALLETTO is also a proud member of FinTech Hub LT, an industry association that represents the interests of fintech companies in Lithuania. This membership provides a direct channel for engagement with the government and regulators, as the Hub actively collaborates with the Bank of Lithuania to shape policy and drive innovation in the financial sector.

Today, Lithuania is second only to the UK in the number of licensed electronic money institutions (EMIs) in Europe, hosting more than 80 EMIs and dozens of payment and card-issuing companies, including Vinted, Paysera, and Contis. At the centre of it all is the Bank of Lithuania, which took the bold step of opening direct communication channels with fintech founders and offering a regulatory sandbox long before the concept became trendy.

“Our goal was to operate like a startup government for fintech,” says Marius Jurgilas, former board member of the Bank of Lithuania. “We never shouted about it. We just did it.”

The country’s deliberate strategy was to make Lithuania not just another European financial centre, but a uniquely agile one. Licensing takes 3 months. Communication is direct. Technical support is real-time. For fintech companies battered by bureaucratic slowness in bigger markets, this is oxygen.

“Lithuania offered us not just a license but a real partnership,” says Lasmanis. “You can call someone at the central bank and actually get answers.”

WALLETTO and the Quiet Revolution

As a full member of both the Visa and Mastercard networks, the company issues and acquires cards, processes cross-border payments, and delivers mass payout services to merchants across the EEA. Unlike many startups in the space, WALLETTO operates on its own infrastructure — giving it greater control, reliability, and scalability.

“We built our own payment gateway, rather than white-labelling someone else’s,” says Lasmanis. “That allows us to move faster, integrate better, and reduce dependency. It’s one of the reasons we’re still standing while others have pivoted or collapsed.”

Owning the stack has also allowed WALLETTO to implement advanced features — from real-time merchant dashboards to flexible API access for fintech partners, as well as dynamic card issuing across both consumer and corporate lines. “You don’t see that level of agility in larger markets,” he adds. “In Lithuania, it’s possible to do things right — and fast.” WALLETTO offers services such as BIN sponsorship, mass payment infrastructure, and support for Visa OCT and Mastercard MoneySend payouts — features typically only available through much larger institutions. WALLETTO’s ability to serve merchants across Europe is not an accident of geography. It is a reflection of a financial system built for modern needs. “We’ve helped clients move from concept to card issuance in weeks, not months,” Lasmanis says. “That’s only possible in an environment like Lithuania.”

Regulatory Confidence in a Risk-Averse World

At the heart of Lithuania’s appeal is a pragmatic regulatory environment. The Bank of Lithuania promises to review EMI applications within three months, provides clear licensing pathways, and supports both traditional and crypto-adjacent financial services. It even allows direct access to SEPA — the eurozone’s payments backbone — through its CENTROlink system. “In the post-Brexit shuffle, Lithuania did what big economies couldn’t: provide certainty,” says Michael Barr, Vice Chair for Supervision at the U.S. Federal Reserve. “In times of market disruption, clarity and access win over heritage.” Lithuania’s fintech licensees are also granted access to the European market without the bureaucratic and political complications found elsewhere.

“We’ve had open dialogues with the regulator about product design, risk frameworks, and transaction security,” Lasmanis says. “That kind of responsiveness is rare. It gives you confidence to innovate.”

International Parallels: Learning from Global Fintech Leaders

Lithuania’s fintech success is part of a broader global movement, but it stands out for the quiet, effective way it has been achieved. Looking beyond Europe, there are several instructive parallels and contrasts with other fintech hotspots, especially in the US, Singapore, and the UK.

The United States: Innovation Through Scale and Regulatory Complexity

The US fintech ecosystem is by far the largest and most diverse globally, with hubs in Silicon Valley, New York, and increasingly in Miami and Austin. Companies like Stripe, Square (now Block), and PayPal have revolutionised payments and digital banking services on a massive scale. Yet the US faces challenges different from Lithuania’s. “The US regulatory landscape is complex and fragmented, with different rules at federal and state levels,” explains Lisa Thompson, fintech analyst at CB Insights. “Companies often spend years navigating the patchwork of licenses and compliance regimes before scaling nationally.” Stripe’s journey highlights this challenge vividly. Founded in 2010 in San Francisco, Stripe offers a global payments platform, but securing operational licenses across the US was a multi-year effort. To legally offer money transmission services, Stripe had to acquire money transmitter licenses in all 50 states plus Washington D.C., each with its own regulatory nuances, fees, and compliance requirements. According to company disclosures and industry reports, Stripe began obtaining these licenses in 2012, but it wasn’t until 2017—five years later—that it had full coverage. The time and capital spent on compliance were significant. For startups, this is a major hurdle.

In contrast, Lithuania offers a single, streamlined licensing process through the Bank of Lithuania that takes roughly three months, and crucially, grants passporting rights across all EU states. For fintech firms, this provides immediate pan-European market access, something US fintechs seek through partnerships or cumbersome multi-state licensing.

Yet the US benefits from deep capital markets, an entrepreneurial culture, and cutting-edge technological innovation, including pioneering work in AI, blockchain, and decentralized finance (DeFi). The regulatory framework, while complex, is gradually evolving. The Office of the Comptroller of the Currency (OCC) introduced a special purpose national bank charter for fintech firms in 2016, aiming to reduce fragmentation, though adoption remains cautious.

“In the US, the pace of innovation is rapid, but the regulatory costs and risks are high,” says Michael Barr of the Federal Reserve. “Lithuania’s model offers an attractive alternative — a smaller but highly accessible and cooperative jurisdiction.”

Singapore: Smart Regulation and Regional Gateway

On the other side of the world, Singapore provides another example of how small jurisdictions can punch above their weight. The Monetary Authority of Singapore (MAS) is famous for its forward-looking regulatory sandboxes and proactive engagement with fintech startups. Singapore’s fintech ecosystem thrives by positioning itself as a gateway to Southeast Asia’s rapidly growing markets, projected to reach $240 billion in digital payments by 2027. Singapore combines a robust regulatory environment with significant government funding, talent development, and strong intellectual property protections. According to MAS data, as of 2024, over 400 fintech firms are licensed or registered in Singapore, including over 120 payment service providers. The country has expedited fintech licensing through a tiered system introduced in 2020, where smaller firms can obtain a digital payment token license within as little as 2 months. Like Lithuania, Singapore’s regulators offer clear guidance and fast-tracked licensing, but Singapore leverages its geopolitical position and trade relationships to integrate fintech with broader economic ambitions such as digital banking, wealth tech, and sustainable finance. “Singapore and Lithuania share a similar philosophy: act as facilitators, not gatekeepers,” notes Siti Mariam, fintech consultant based in Singapore. “Both create an environment where innovation is encouraged but risks are carefully managed.”

The UK: The Rise, The Fall, and The Recalibration

Before Brexit, London was the undisputed European fintech capital, home to Revolut, TransferWise (now Wise), and Monzo. The UK pioneered open banking and developed a comprehensive fintech ecosystem with investor enthusiasm, skilled labour, and mature regulatory frameworks. However, Brexit fractured London’s seamless access to the EU market, leading many fintechs to establish subsidiaries elsewhere in the EU — Lithuania being a prime beneficiary. The UK government’s Fintech Sector Strategy report of 2023 showed that despite Brexit, the UK fintech sector grew by 13% year-on-year, reaching an estimated £19.9 billion in gross value added. However, roughly 30% of fintech companies reported establishing a secondary base within the EU, often citing regulatory uncertainty as a key factor. “London’s fintech story is one of ambition and boldness,” says fintech author Chris Skinner. “But Lithuania’s story is about precision and partnership. One shouted from the rooftops, the other built quietly behind the scenes.” The UK is now recalibrating its fintech approach with plans to reduce regulatory burdens and attract new international firms. The Financial Conduct Authority (FCA) launched an updated regulatory sandbox in 2024 and has introduced a new ‘innovation hub’ aimed at speeding up approvals for emerging technologies such as AI-powered financial advice.

But the post-Brexit environment means Lithuania will remain a key player for firms needing EU market access. For many fintechs, the UK remains a primary innovation hub, while Lithuania offers regulatory clarity and market reach within Europe.

A Model for Modern Finance

Lithuania’s fintech story is more than just one of post-Brexit opportunism. It’s a case study in how small states can lead in financial innovation without massive economies or headline-grabbing PR.

“Lithuania has quietly become a fintech superpower by building efficient systems and removing bureaucracy. That’s real innovation,” says Nouriel Roubini, professor of economics at NYU. “They’re not chasing unicorns. They’re building pipes.”

That insight is echoed in a 2024 report by the European Banking Authority, which praised Lithuania’s “clear licensing regime, progressive risk tolerance, and strong supervisory record.”

Meanwhile, the U.S. Federal Reserve Bank of New York has pointed to Lithuania as a potential model for future digital dollar infrastructure, citing the country’s success in integrating central banking with agile fintech oversight.

“Lithuania is an emerging model for how to scale secure, digital-first financial infrastructure in the public interest,” said Christine Lagarde, President of the European Central Bank, in a 2023 speech at the European Investment Bank. The IMF and BIS have also noted Lithuania’s regulatory sandbox and open banking capabilities as forward-looking frameworks that could guide future EU-wide reforms.

Talent, Technology, and Trust

Critically, Lithuania’s success isn’t built on tax arbitrage or PR gloss. It’s a story of trust, technical depth, and talent.

“Talent here is exceptional,” says Lasmanis. “We’re not outsourcing development to far-away countries. Our developers, compliance officers, and operations people are right here in Vilnius. And they’ve built systems — from BIN sponsorship to e-invoicing to 3D Secure — that rival anything you’d see in Frankfurt or Dublin.”

Beyond WALLETTO, Lithuanian companies have developed fraud-detection AI, next-generation onboarding tools, and digital ID authentication platforms now used across Europe.

Chris Skinner, fintech author and commentator, perhaps summed it up best: “While London still talks about fintech dominance, Lithuania built a real-time highway and let the traffic in.”

Startups and scaleups benefit from a thriving ecosystem of technical universities, government grants, venture funds, and international accelerators.

Expanding Horizons: Lithuania’s Global Ambitions

WALLETTO, for its part, is now looking westward. “The next step for us is global expansion — into the U.S. market and beyond,” says Lasmanis. “But we’ll always be proud of where we started. Lithuania gave us the platform. The rest is up to us.”

This ambition is echoed across many Lithuanian fintechs, which are eyeing markets in North America, Asia, and the Middle East. What these companies bring to the table is not just product innovation, but operational agility and a regulatory mindset that balances compliance with speed.

By contrast, while the US offers unparalleled scale and capital, it remains a complex web of federal and state regulations. Singapore continues to refine its niche as a gateway to Southeast Asia, but the cost of entry remains high, and competition fierce. The UK is recalibrating after Brexit but faces a long road to restore seamless EU market access.

Lithuania’s quiet success suggests a powerful lesson for fintechs and regulators alike: innovation flourishes where systems are designed around people and process, not just products or valuations.

The Fintech World Beyond Unicorns and Hype

The fintech world tends to focus on unicorn valuations, celebrity founders, and billion-dollar funding rounds. Lithuania offers a different model: a country that got the plumbing right.

And sometimes, that’s all it takes.

In a world where innovation is often associated with noise, Lithuania’s quiet competence stands out. It hasn’t tried to steal the limelight. It simply became indispensable.

Sometimes, the best revolutions don’t come with fireworks. They come with clean code, fast licenses, and a regulator who picks up the phone.