Lithuania to boost central bank headcount in response to Revolut with Top Gear-inspired strategy

By Oliver Smith on Monday 25 February 2019

Digital Banking

All we know is, they call it the STIG.

Lithuania to boost central bank headcount in response to Revolut with Top Gear-inspired strategy
Image source: Revolut

Over the last few months, digital bank Revolut has faced increasing political turmoil in Lithuania, the country where its European banking license was granted.

The crux of the debate comes down to Lithuanian politicians raising concerns over the speed with which Revolut’s license was granted and potential links to Russia.

Now Vilius Šapoka, Lithuania’s Minister of Finance, has told AltFi that he is “absolutely” looking to increase staff numbers in response to growing numbers of fintech startups coming to the country.

“Not only in the bank of Lithuania but also in other institutions such as financial investigations [and those] responsible for anti-money laundering, it’s a natural development and sufficient resources should be devoted to this area.”

Critics of the government point to concerns that Lithuania could end up joining its Baltic neighbours Latvia and Estonia, both of which have been caught in money-laundering scandals in recent years.

On recent calls for an unprecedented third investigation into Revolut’s licence by Stasys Jakeliunas, head of the Lithuanian parliament’s budget and finance committee, Šapoka said:

“Mr Jakeliunas... focuses on risks which can stem from the development of the fintech industry. I have a different opinion.”

Lithuania now claims to be the second most popular European country for fintechs to start, and Šapoka (pictured right) said his aim is to continue the transformation of Lithuania into a hub of high-tech industry with a uniquely named strategy.

“If you want to develop a high-tech industry you definitely need to shift into the top gear with a strategy that balances speed and security. We call it STIG, or the STIG-strategy,” Šapoka told AltFi.

The acronym stands for Start, Tax, Invest and Growth, with Lithuania’s low-profit taxes as the centrepiece along with favourable tax reductions on research and development and regulatory sandboxes for fintech and crypto.

“In the future, we’ll also have a very comprehensive memorandum of understanding between all Lithuanian institutions that deal with risk management, data protection and consumer protection.”

Whether Šapoka’s Top Gear-inspired approach to repositioning Lithuania as a fintech hub will work, or whether this drive will leave it facing a scandal of its own, we’ll have to see.

And on that bombshell...

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