Why is innovation so important

March 15, 2021

Interview with Marius Jurgilas, Member of the Board at the Bank of Lithuania 


The Bank of Lithuania is considered one of the most innovative regulators worldwide. How and why did the Bank of Lithuania become synonymous with innovation?  

It’s no secret that financial services are undergoing a great technological transformation. We have chosen to play an active role in this process by seeking to become a partner for the financial sector, promoting innovation and sustainable growth. This has been a strategic direction of the Bank of Lithuania for the past 4 years. Most importantly, this direction is also shared by other public institutions.  

One of the objectives of our Fintech policy is to strike the right balance between acknowledging and managing potential risks while also enabling financial innovation. As a central bank and supervisory institution, the Bank of Lithuania has found itself in a position to ensure an orderly usage of new technologies in the financial markets. The multiplicity of mandates turned out to be a useful tool for us to see a bigger picture of financial markets globally. It has encouraged discussions outside the rigid organisational silos and facilitated a cultural shift towards combining a strict supervisory view with a partnership approach.  


How has Lithuania’s financial market changed over the last 4 years? What does the sector look like from the regulator’s perspective?  

There has been a significant change. In recent years, Lithuania has become the number one jurisdiction for electronic money institutions in the European Union. Other sub-sectors of Fintech, such as P2P lending and crowdfunding, also saw dramatic growth.  

These changes facilitated the digitalisation of consumer behaviour. The preference for mobile banking and non-cash payment solutions is already much higher in Lithuania than just a few years ago. Having said this, this change is posing a lot of issues in terms of access to financial services, financial inclusion and risk management. Ensuring sustainable change is a constant balancing act.  

It was a privilege to be acknowledged as the forerunners of innovation. In the current age of digital excitement, the Bank of Lithuania has decided to set itself up for digital maturity. First of all, we are making substantial investments upgrading our record-setting CENTROlink payment system, which is heavily used by financial market participants. 

We are also about to modernise our data management system, deploying new Regtech solutions, which has provided us with lessons on how to streamline reporting procedures as well as reduce the administrative burden and costs for both supervised entities and the regulator. As a supervisory authority, we will be able to gain insights on potential market risks and share them with financial market participants in a more timely and accurate manner, resulting in more efficient supervisory practices.  

Lastly, we are heavily involved in the Eurosystem’s efforts to build digital Euro prototypes in a series of practical experiments. In this endeavour, we are relying on the knowledge we have built during our own DLT experimentation projects in recent years.  


Financial technology is moving forward at an incredible pace with constant innovations. Now that Lithuania has established itself as a definitive payments/remittance centre, which Fintech sub-sector could be the next big success story in Lithuania?  

When it comes to our success in the Fintech sector, we have had an appealing narrative: policy changes in Lithuania created a more conducive ecosystem for innovative Fintech companies to address their own challenges. Our businesses and consumers need faster, cheaper and more innovative financial services. We also need innovation and high value-added jobs to be created here, in Lithuania. That is exactly what we have managed to achieve, largely in the payments and digital banking sectors.  

Now, we can use these results (such as accumulated knowledge and trained staff) as a foundation for further growth in sectors such as Wealthtech, which is especially ripe for growth, given the new European Crowdfunding Regulation and an increased need for investments after the outbreaks of the coronavirus. 

Want more info on Lithuania’s Fintech sector? Get the new ‘Fintech Landscape in Lithuania 2020-21’ report:  

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Aistė Žebrauskienė
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    Aistė Žebrauskienė Press Officer
    Thank you!

    Thanks for reaching out to us, this means a lot! We will get back to you shortly.

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