Latvian Fintech Ecosystem Sees Growth and Innovations in 2024 Despite Sector Contraction

In 2024, the Latvian fintech ecosystem continued to grow and evolve, driven by rapid technology advancements, new companies entering the sector, and strategic partnerships to boost growth, a new report by Venture Faculty, a business consultancy based in Riga, says.

The Latvia Fintech Landscape 2024 report, produced in collaboration with Dealroom, provides an overview of the state of fintech in Latvia, exploring the trends and dynamics that emerged in 2024.

According to the report, the Latvian fintech industry continued to evolve this year with promising early-stage companies gaining significant traction and receiving considerable financial backing.

Jeff App, a financial marketplace for emerging economies, raised US$2 million in a seed round in July to enter new markets and expand its suite of financial services and products. The company provides underserved populations with competitive credit solutions, serving markets including Vietnam, the Philippines and Indonesia, and has grown to US$10 million in revenue. It became profitable in 2023 and claims to have enabled more than 6 million people apply for over 60 million financial products since its inception.

Another funding round was secured by inGain, a credit technology startup founded in 2011. The company, which provides a no-code software-as-a-service (SaaS) loan management system, raised EUR 650,000 in April to further develop its platform.

2024 also saw significant development from Latvia’s well-established fintech companies. The peer-to-peer (P2P) and crowdfunding sector was particularly active, with companies raising large rounds of funding and expanding their offerings and entering new markets.

For example, Mintos, an alternative investment platform, raised EUR 3.1 million through a crowdfunding campaign in August to expand into EU markets, enhance its platform, and improve product offerings. Established in 2014, the company allows investors to diversify their portfolios by investing in loan-backed securities, bonds, and exchange traded funds (ETFs). It claims more than 500,000 registered users and EUR 600 million in assets under management (AUM).

New fintech products and companies

2024 was also marked by the entry of new fintech players and the launch of innovative solutions. Indexo, for example, introduced in August a new neobanking solution. Indexo Bank offers a comprehensive suite of banking products, including checking accounts, savings vaults, term deposits, and consumers loans. It is now planning to start mortgage lending to individuals in Q1 2025, and to begin servicing small and medium-sized enterprises (SMEs) in Q4 2024.

As of November 19, Indexo Bank had 16,000 clients, and total deposits of EUR 23 million.

Indexo is a financial services group that includes pension management and the Indexo Bank. It’s one of the fastest-growing pension managers in the Baltics, with over 137,000 customers and more than EUR 1.21 billion in AUM.

The year also saw the Bank of Latvia issue new electronic money institution license to TigSiPay and xpate, reinforcing the country’s position as a hub for payment innovation, while the launch of Upwood, a platform focused on forest tokenization, underscores the emerging green finance sector.

Finally, strategic partnerships were unveiled, including the collaboration between Fondeadora and MeaWallet in Mexico to drive digital payment adoption

Strategic partnerships played a crucial role in shaping the fintech landscape in 2024. For instance, Lithuania’s Walletto introduced in July customized Mastercard prepaid business cards for Bonusukarte.lv.

Bonusukarte.lv is a Latvian company that focuses on enhancing employee satisfaction and loyalty through customized employee benefits solutions. It offers a system for employers to provide personalized cards to their employees which can be used in various establishments that accept bank cards.

The Latvian fintech ecosystem

In 2024, the Latvian fintech ecosystem featured 135 fintech companies, including both local and foreign companies with a presence in Latvia. The number represents a 5% decline from 142 companies in 2023, signaling a contraction of the sector.