Switzerland has been named the second most engaging location in Europe for fintech stakeholders, surpassing the Netherlands, Estonia, and the UK. The nation is acknowledged for its conducive enterprise atmosphere and the attractiveness of the native marketplace for fintech gamers, based on the 2024 European Fintech Index.

The index, launched on June 27 by Lithuanian fintech firm ConnectPay, offers an outline of the fintech panorama throughout Europe. It evaluates key markets within the area and their potential for fintech companies, authorities establishments, traders, and different stakeholders, assessing market potential via three dimensions:

  • “Fintech attractiveness”: This consists of metrics such because the presence of fintech-related regulation, funding per capita, workforce share, and the variety of fintech licenses. These components decide whether or not a rustic might be deemed a positive marketplace for establishing a fintech enterprise;
  • “Enterprise attractiveness”: This spans a number of parameters comparable to startup friendliness, ease of doing enterprise, and taxation competitiveness to outline the general context for conducting enterprise; and
  • “Market attractiveness”: This covers elements that make a market favorable for fintech to conduct industrial operations and efficiently scale. Metrics embrace inhabitants engagement with digital and monetary providers, financial well being, and related laws.

Throughout the 32 European nations studied, Switzerland ranks second, acknowledged for its favorable enterprise panorama (ranked third) and market potential (ranked third). The nation additionally boasts one of many area’s largest numbers of startup unicorns.

Comparison of unicorn hubs, total numbers versus per capital leaders, Source: 2024 European Fintech Index, ConnectPay, Jun 2024
Comparability of unicorn hubs, whole numbers versus per capital leaders, Supply: 2024 European Fintech Index, ConnectPay, Jun 2024

Switzerland has made some efforts to create a conducive enterprise atmosphere for fintech firms. In 2023, it launched the Swiss Monetary Innovation Desk (FIND), an unbiased unit throughout the State Secretariat for Worldwide Finance (SIF), geared toward fostering monetary innovation by supporting collaboration between the private and non-private sectors.

The federal government has additionally launched regulatory modifications to supply better authorized readability and encourage innovation. These embrace the Fintech license launched in 2019, the regulatory sandbox launched in 2017, and the pioneering “DLT Act”, a laws overlaying blockchain expertise, digital property and tokenization that got here into power in 2021.

Challenges in fintech attractiveness

Regardless of its excessive rankings in enterprise and market dimensions, Switzerland ranks eighth in Europe for “fintech attractiveness,” behind jurisdictions like Estonia and Luxembourg.

Overview of the top 5 countries in the 2024 European Fintech Index, Source: 2024 European Fintech Index, ConnectPay, Jun 2024
Overview of the highest 5 nations within the 2024 European Fintech Index, Supply: 2024 European Fintech Index, ConnectPay, Jun 2024

Earlier analysis has delved into the difficulties fintech firms face within the Swiss market. The 2024 IFZ Fintech Examine by the Lucerne College of Utilized Sciences and Arts’ Institute of Monetary Providers Zug (IFZ) highlights that Switzerland is lagging behind fintech hubs comparable to Singapore and Sweden. These nations have been extra proactive in enhancing their help for fintech firms, overshadowing Swiss efforts.

Moreover, a 2024 research by UBS, Credit score Suisse, and the Swiss ICT Investor Membership (SICTIC) signifies that Swiss startups face vital funding challenges and restricted worldwide recognition. Furthermore, with a inhabitants of simply 9 million, the native market is simply too small for startups to thrive, compelling younger Swiss tech ventures to hunt worldwide enlargement early of their improvement.

Entry to well-educated employees is one other key problem confronted by Swiss startups, with 46% of the founders polled by Credit score Suisse discovering it laborious to fill vacancies with appropriate candidates. Labor market challenges are extra pronounced for startups within the progress and enlargement section, with 55% of struggling to recruit certified staff, in comparison with 39% for startups within the pre-seed and seed levels.

Sweden acknowledged as probably the most enticing nation in Europe for fintech stakeholders

The 2024 European Fintech Index ranks Sweden as probably the most enticing nation in Europe for fintech stakeholders. The nation, which ranks throughout the prime 5 throughout all three dimensions, is acknowledged for its excessive variety of info and communications expertise (ICT) and fintech professionals, and its fintech-friendly labor market construction.

Baltic state Estonia tops the rating within the enterprise (ranked 2nd) and fintech (1st) dimensions, because of its robust unicorn presence per million capita, excessive variety of fintech offers per million capita, and favorable regulatory frameworks.

Lastly, Denmark ranks 1st in market attractiveness, supported by its robust gross home product (GDP) per capital and personal consumption progress indicators. The Scandinavian nation takes the third place within the general rating.

Top 10 countries in the 2024 European Fintech Index, Source: 2024 European Fintech Index, ConnectPay, Jun 2024
Prime 10 nations within the 2024 European Fintech Index, Supply: 2024 European Fintech Index, ConnectPay, Jun 2024


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