As Europe’s digital finance ecosystem matures, innovation alone is not enough to ensure scalability, future growth and longevity. Regulation, customer expectations, user experience (UX), and social responsibility are raising the bar for all companies, including
in financial services and amongst fintech firms. Firms capable of balancing growth with inclusion, speed with oversight, and innovation with integrity are the ones most likely to thrive going forward.
Ireland is well positioned as a hub for this more sustainable, circular model of innovation. It is the only English-speaking country in the EU, has a highly skilled workforce, a robust and well-regarded education system and a pro-business government. There
are deep-rooted strengths in both financial and technology sectors clearly visible with many of the largest and most well-known companies in these sectors having operations there including UK firms such as Revolut, Barclays, HSBC, Paysafe, R3, Vodafone, and
BT.
Regulation as a growth lever: MiCAR in focus
Ireland has become a strong location of choice for many financial services companies who have sought, and subsequently obtained, regulatory authorisation for various licences including but not limited to payment institutions, e-money institutions, MiFID,
insurance distribution, insurance intermediaries and UCITS. These licences, authorised and supervised by the Central Bank of Ireland (CBI) with its well-regarded reputation as a robust, thorough and strong regulator, give access to the wider EU market through
passporting, and have enabled many companies in the financial services sector to grow their European footprint from Ireland including several UK fintech and payments firms such Paysend, Paymentsense (Dojo), Paytrix, Soldo, TrueLayer, and Investec, to name
a few.
The Markets in Crypto Assets Regulation (MiCAR), is an EU regulatory framework introduced in January 2025 that marks a turning point for digital and crypto assets in Europe. It will regulate the transparency and disclosure requirements for the issuance and
trading of these asset classes by Crypto Asset Service Providers (CASPs). This regulatory framework will seek to protect customers and investors and will provide regulatory oversight for specific areas of digital and crypto asset activities that, until the
introduction of MiCAR, were not covered under EU legislation.
Ireland is well positioned to continue to win regulated and front office investments in the aforementioned areas, but also in the new area of MiCAR. As firms seek to become MiCAR authorised within the EU, Ireland will likely be considered a strong location
of choice for many firms.
In June this year, Kraken became the first company authorised under MiCAR in Ireland by the CBI. Kraken, a US headquartered crypto and digital asset exchange, noted this is a “pivotal milestone in our European expansion.”
Digital inclusivity in fintech
As financial services becomes more digitised and functions become more automated, the potential for greater service offerings and cost efficiencies for both the customer and provider will grow, but with that, so too will the risk of exclusion.
While embedded services and online platforms have expanded access for many and changed user experiences for the better, the more vulnerable groups in society and those with limited digital literacy may experience the opposite, potentially making their ability
to use these services more challenging.
Accessible design, friendly user interfaces and effective and well thought out client engagement must go beyond meeting compliance requirements to become integral to how financial products are developed, tested, offered and delivered. This is reinforced
by the European Accessibility Act which sets out clear expectations to help improve the functioning of internal markets for accessible products and services in Europe.
The conversation around inclusion in the fintech and payments sector is prevalent, particularly as many of these companies are continuing to challenge traditional financial institutions for retail customer market share. This is becoming more front and centre
and there is noticeable increased engagement with existing customers, market outreach and data gathering, and a growing awareness of customer needs (as well as wants) to ensure the widest target audience possible is being met.
While work remains, it is clear the firms who lead now on accessibility and inclusion as key differentiators rather than implementation in retrospect, are the ones that have the greatest potential for growth, capturing market share and scalability.
The role of AI
AI is becoming more sophisticated, well designed and being utilised by all sectors, including financial services. The opportunities are vast with many thought leaders in this space noting that its potential and is yet to be fully realised. However, there
is still a need for human interaction and engagement with AI models to ensure trust, oversight and accountability and that the risk of error and of ‘bad actors’ to corrupt or manipulate these models is monitored, managed and prevented at all times.
Human-in-the-loop (HITL) models that combine human expertise and machine learning creating a more collaborative system where humans and AI work together are gaining traction, particularly in high-stakes areas like credit risk, fraud detection, and compliance.
With the EU AI Act expected to take full effect by 2026, firms will need to meet new obligations around explainability, data governance, and ethical risk management.
Ireland is well placed to support this evolution. The large-scale presence of existing and well-established financial services and technology sectors in Ireland with skills in areas of AI, data analytics, data science, machine learning, engineering, and
high-quality RD&I centres have continued to make Ireland an attractive location for some of the world’s largest and leading firms to establish hubs and grow existing operations to support global growth in these capabilities. This, accompanied by the collaboration
of industry and academia and supported by Government through agencies such as IDA Ireland, have made Ireland a thriving hub for AI in Europe and globally.
A circular ecosystem for growth
MiCAR, digital inclusion, and AI are all part of the fundamental changes redefining what a competitive advantage looks like in fintech today. AI-powered compliance tools, for example, don’t just improve cost efficiencies, they enable scalability, growth
and future success. Inclusive design not only builds trust but also expands the addressable market and acknowledges the customer needs.
Ireland’s fintech ecosystem supports this circular progress. Ireland is a pro-business environment that is supportive of foreign direct investment (FDI), collaboration and industry communication, and a location where the saying “a rising tide will lift all
ships” is understood. Today, IDA Ireland supports more than 70 multinational fintech and payments companies in Ireland, employing around 7,000 people across the country. The growth of this sector in Ireland has been very successful and the continued opportunity
for new activity, expansion by the existing footprint and the potential for new entrants remains strong.