Ireland's fintech hopes held back by lack of investment

Ireland's fintech hopes held back by lack of investment

Ireland's ambition to be known as a world-leading hub for fintech startups is in danger of petering out due to a lack of accelerators, according to the head of an industry group looking to promote startups.

Eoin Costello, CEO of non-profit partnership Startup Ireland, bemoaned the fact that Ireland has just a handful of accelerators despite a vibrant startup sector.

Speaking to Irish website thejournal.ie, Costello cited the departure of leading accelerator Wayra in May 2015 as a major blow. During its time in Ireland, the Telefonica-owned Wayra invested more than €2m in 30 startups including the anti-fraud service Trustev which was acquired by credit bureau TransUnion for €40m in December 2015.

The lack of accelerators was both worrying and surprising said Costello given Ireland's talent, track record and tax rate. He suggested that added incentives like rate-free premises and tax exemptions may help attract new accelerator programmes.

Meanwhile the head of national development agency Enterprise Ireland has highlighted the lack of a well-established and diverse seed-funding market as a barrier for Irish startups. Taxpayer-funded Enterprise Ireland is one of Europe's largest seed investors in terms of total investments.

The four largest funds supported by Enterprise Ireland comprise €124m in assets with Bank of Ireland and AIB managing two each. However, private sector investment lags a long way behind, said CEO Julie Sinnamon, speaking to thejournal.ie.

"If there was a fully functioning seed market we could step back. But we are a key player there because there is still a strong need for us to encourage those early stage companies which are at the higher-risk end."

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