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Brexit encouraged the British electronic money institution to choose Lithuania

Brexit encouraged the British electronic money institution to choose Lithuania

31/07/2018

While Great Britain leaves the European Union and British FinTech companies will not be able to provide services across the EU, a part of the new companies are choosing Lithuania for their activities. The Bank of Lithuania has issued an electronic money license to “Pyrros Lithuania”, a UK-based electronic money institution, managed by the British company “Perniciem Limited”, which expects not only to expand the range of services for existing customers, but also to create a new digital financial services platform.

The new electronic money institution intends to use modern technologies to apply modern financial solutions adapted to the specific needs of the client. The company will concentrate on pre-paid cards, SEPA, SWIFT, faster payments and foreign exchange markets. “Pyrros Lithuania” plans to issue physical / virtual and digital payment cards through its platform to its clients.

The company will initially employ 2-3 individuals in Lithuania, but believes that this number will undoubtedly grow. “The business will be expanded, as Vilnius becomes our hub throughout Europe,” says John Williams, director of “Pyrros Lithuania”.

“The business will be expanded, as Vilnius becomes our hub throughout Europe,” says John Williams, director of “Pyrros Lithuania”.

Although the founders of the company already have considerable experience in the field of the development of various payments and financial technology solutions, however, these services have so far been able to offer their clients only through the services of intermediaries, therefore the license will provide the opportunity to provide payment, crediting of funds, issuing payment cards through the CENTROlink system services directly to its customers, avoiding the intermediation of banks and other third parties. By offering these services directly, the founders also expect to reduce the prices of services provided to customers.

According Inga Karulaityte, attorney at law of law firm ECOVIS ProventusLaw, which advised “Pyrros Lithuania” by receiving the license of electronic money institution, this shows that Lithuania is successfully competing in the context of Brexit with other countries claiming the status of FinTech Center in Europe after Brexit. “Brexit is a huge opportunity for Lithuania, and such events occur only once in a few centuries. It is gratifying that the shareholders of “Pyrros Lithuania” noticed Lithuania’s advantages. The news about Lithuania as an attractive country for financial innovations is spreading more and more. Lithuania is a serious player in this market”, says I. Karulaitytė.

“Brexit is a huge opportunity for Lithuania, and such events occur only once in a few centuries. It is gratifying that the shareholders of “Pyrros Lithuania” noticed Lithuania’s advantages”, says I. Karulaitytė.

32 FinTech licenses were issued in Lithuania in 2017 – almost twice as many as in 2016. Over the past 1.5 years, ECOVIS ProventusLaw assisted by licensing for 13 companies from around the world. A very high level of interest have recently been felt not only from the UK, but also from East Asia, and above all China. This is indicated by the license issued for “International Payment Union” by the Bank of Lithuania on the same day as the license was issued for “Pyrros Lithuania”. The main shareholder of “International Payment Union” is Hong Kong’s “TradeFinance Chain Service Limited”, which works closely with the “VTeam Financial Service Group” (“VTeam Group”), which is involved in the development of various financial products and systems. The company also was advised by the law firm ECOVIS ProventusLaw.

The new electronic money institution intends to develop an e-commerce platform and provide business-to-consumer, business-to-business-type payments within the EU, as well as payment services between EU countries and China. It is planned that 20 employees will be employed in Lithuania during the first year of operation, and this number will increase to 80 in three years. “Firstly, we intend to open electronic money accounts, issue and redeem electronic money to and from clients, payment cards to some of the clients and  execute payments related to the issued electronic money under payment orders placed by clients”, said Crystal Hsieh, representative of “TradeFinance Chain Service Limited”.

Lithuania is attractive for FinTech companies from all over the world due to its flexible and friendly legal environment, well-developed information and communication technology infrastructure and fast licensing procedures. For example, it will take three days for an enterprise to register, whereas an electronic money institution or a payment institution’s license may be issued within 3 months if the documents are prepared without mistakes.

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