Opportunities for FinTech Companies

Authored by Karolis Grižas, Associate Partner and Attorney-at-Law, and Ovidijus Speičys, Senior Associate and Attorney-at-Law, of Glimstedt Law Firm

The European Union and India signed the Free Trade Agreement in January 2026. The result of 20 years of negotiations, called the “mother of all deals”, will link the European Union and Indian markets and create the world’s largest free trade zone, encompassing approximately 2 billion people and accounting for nearly 25% of global gross domestic product.[1]

Bilateral trade between the European Union and India in goods and services totalled approximately €180 billion in 2024. One of the main objectives of the Free Trade Agreement is to increase trade volumes by gradually eliminating approximately 90% of tariffs on goods exported from both markets, as well as creating better conditions for the provision of services by ensuring that both sides adhere to predefined standards.[2]

One of the annexes to the Free Trade Agreement is dedicated to the financial services sector. This article explores the potential implications of the new trade agreement for financial technology (FinTech) companies in the European Union, in particular those based in Lithuania and India.

Lithuania and India – Two Leaders in the FinTech Sector

Lithuania has long been recognised as one of the most favourable countries for FinTech companies. Over 270 FinTech licenses have been issued in Lithuania – the highest number in the European Union and globally on a per capita basis.[3]An expedited licensing process, combined with a large pool of multilingual talent with skills in information technology and anti-money laundering, enables Lithuania to maintain its position as a leader in the FinTech sector.[4]

India boasts a similar success story. In a country with over 1 billion internet users and more than 700 million smartphones, the FinTech sector has grown over the past decade from a niche field to one of the largest ecosystems in the world[5]. This growth has been driven not only by a large population that is highly entrepreneurial and well educated in information technology, but also by the targeted efforts of government agencies to create the most favourable conditions for the development and integration of financial technologies into everyday life.

The targeted efforts of Indian authorities in this area are best demonstrated by the advanced digital infrastructure they have developed, a key component of which is the Unified Payments Interface (UPI), launched in 2016. UPI is used for peer-to-peer transfers and payments for goods. 691 banks are connected to UPI, and in January 2026 alone, 21.7 billion transactions were processed on this platform.[6]

A driven population with deep IT knowledge, combined with the systematic development of the necessary digital infrastructure, has enabled India to become one of the world’s FinTech leaders in a relatively short period of time, ranking third in the world in terms of the number of FinTech companies founded in the country (about 14,500) and fourth in terms of FinTech startups that have achieved unicorn status (31).[7]

Objectives of the Free Trade Agreement in the FinTech Sector

Annex 8-C of the Free Trade Agreement is dedicated to cooperation between the European Union and India in the financial services sector.

Among other aspects covered by this part of the Free Trade Agreement, the European Union and India have committed to establishing a secure, efficient, accessible, and reliable cross-border payment system and, to the extent possible, to interconnecting payment processing infrastructures. The common system will ensure adequate consumer protection and the prevention of fraud and money laundering, as well as promote innovation and competition in the field of electronic payment services.

The Annex on Financial Services to the Free Trade Agreement also provides for a commitment by the European Union and India to cooperate closely in encouraging financial services and FinTech companies to explore business opportunities in the other party’s market by sharing expertise and developing new financial technologies, including supervisory technologies (SupTech), regulatory technologies (RegTech), central bank digital currencies, and other cutting-edge technologies.

Opportunities for Lithuanian and Indian financial services companies

In recent years, Lithuania has established itself as an attractive jurisdiction not only for domestic FinTech companies but also for third-country firms seeking to operate in the European Union, making Lithuania particularly relevant for companies in India’s fintech sector. The country offers a favourable regulatory environment, a fast English-language licensing process, and innovation-driven institutions, enabling companies to launch their operations smoothly. Furthermore, Lithuania provides access to the entire EU market, allowing companies to serve customers across the European Union with a single license. For Indian financial services companies, this means the opportunity to effectively expand their operations, leverage a pool of highly qualified talent, and benefit from modern digital infrastructure. Growing economic cooperation between Lithuania and India also paves the way for mutually beneficial partnerships and the exchange of innovations in the financial sector.

Lithuania can become a strategic springboard for Indian FinTech companies seeking to enter the educated, digitally advanced, and innovation-friendly European market. The country’s residents are highly financially and technologically literate and quickly adopt new digital solutions, creating a favourable environment for testing and expanding innovative services. By operating in Lithuania, Indian companies can not only gain a better understanding of European consumers’ needs but also effectively develop and adapt their products for the broader EU market.

Similarly, closer cooperation between the EU and India will open up opportunities for Lithuanian FinTech companies to potentially enter the Indian market, which has 1 billion internet users.

Strategic outlook

Recently, it has been observed that India’s financial market participants are showing increasing interest in establishing a presence in Lithuania and expanding their operations, particularly in the areas of payments and crypto-asset services. The companies seek to benefit from Lithuania’s clear regulatory environment and its role as a gateway to the European Union. Their activities are not limited to the export of technological solutions, they also target the local market, offering advanced, secure, and competitive financial products. It is expected that such investments could create high added value for Lithuanian residents, increase the accessibility of financial services, and promote the modernisation of the entire sector.

To make the most of the growing interest from Indian FinTech companies, Lithuania should adopt a strategic approach and strengthen its ecosystem in advance. First and foremost, it is important to ensure greater regulatory clarity and predictability in both licensing procedures and the overall regulatory framework, so that potential investors can act quickly. Local companies and service providers could position themselves by offering specialised services to incoming businesses, ranging from legal and compliance support to technological solutions and talent recruitment. Such a coordinated strategy would allow Lithuania not only to attract more Indian FinTech companies but also to generate long-term value for the country’s economy.

Accordingly, in anticipation of the EU-India Free Trade Agreement, including its Annex on financial services, entering into force early next year, Lithuanian FinTech companies should proactively explore the Indian market by assessing the regulatory environment and engaging in dialogue with local supervisory authorities.

[1] https://www.weforum.org/stories/2026/02/india-eu-mother-of-all-trade-deals-what-to-know/

[2] https://policy.trade.ec.europa.eu/eu-trade-relationships-country-and-region/countries-and-regions/india/eu-india-agreements/memo-eu-india-free-trade-agreement-chapter-chapter-summary_en

[3] https://investlithuania.com/fintech-and-financial-services/?nab=0

[4] https://em.bank/blog/why-lithuania-is-emerging-as-a-financial-hub-for-smes-and-fintechs/

[5] https://assets.kpmg.com/content/dam/kpmgsites/in/pdf/2025/10/indias-fintech-evolution-from-growth-to-resilience.pdf

[6] https://www.pib.gov.in/PressReleasePage.aspx?PRID=2235812&reg=3&lang=2

[7] https://assets.kpmg.com/content/dam/kpmgsites/in/pdf/2025/10/indias-fintech-evolution-from-growth-to-resilience.pdf