Fintech in Ireland: recognising the opportunities and managing risks

Peter Oakes

Founder, Fintech Ireland

From a low base five years ago, Ireland has seen an explosion in the number of fintechs regulated by the Central Bank of Ireland in the areas of payments, open banking, crypto and crowdfunding.

Fintech is firmly part of our daily lives. Whether it be paying utility bills, sending money to family and friends, purchasing insurance, arranging a mortgage, keeping an eye on our pension, borrowing money for major purchases or splitting the costs of electrical goods across interest-free instalments, fintech has become an indispensable tool.  

Modern finance in Ireland

Ireland’s economy is dominated by a handful of big local banks. They face stiff competition from a new bred of bank including bunq, N26, Raisin Bank and Revolut.  New competitors are often established by founders with technology backgrounds rather than traditional finance. With this comes new thinking in terms of product and tech (such as open banking), delivering customer services (including chatbots), fraud detection (for example phishing and smishing scams), optimising investment choice and predicting market trends based on data, our habits and aspirations while embedding machine learning and artificial intelligence into our financial decision process. 

International growth in Irish fintech

At the same time we should not overlook Ireland’s pioneers who have driven the global growth of fintech to an estimated value of $305 billion.  These innovative companies, including TransferMate, Fexco and Fire, are prime examples of dynamic Irish fintechs growing internationally. In the case of the first two fintechs, hailing from Kilkenny and Kerry, they are proof of what can be achieved from regional Ireland.   

New competitors are often established by
founders with technology backgrounds
rather than traditional finance.

Approach to fintech innovation risks

In Ireland, Fintech Ireland which tracks and promotes the Irish fintech ecosystem, reports that there are 280+ indigenous and 130+ international fintechs operating in and from Ireland.  From a low base 5 years ago, Ireland has seen an explosion in the number of fintechs regulated by the Central Bank of Ireland in the areas of payments, open banking, crypto and crowdfunding. In order to understand more about risks posed by fintech, including risks to consumers, the Central Bank has issued a consultation on its approach to innovation covering these and other types of fintechs, including the Web 3 economy including tokenisation, decentralised finance and blockchains.  

Supportive ecosystem for fintech

Whatever is next for the future of fintech will be dependent upon technological advances, consumer wants and regulation. Ireland is well-placed to continuing attracting innovative fintech to its shores owing to the ease of doing business here as well as access to our highly-educated workforce and continuing support from IDA Ireland, Enterprise Ireland, the Department of Finance and the Central Bank.