Consumer demand for fintech solutions and digital banking increases, indicating that the country is ripe for its fintech revolution. Romania is set to follow in the steps of its neighboring countries, Poland, Czech Republic and Austria.
Romanian bank commissions are among the highest in the region, which increases the appeal of fintech and digital-first banks.
“Romania is poised for deep fintech disruption due to the fundamental discrepancies between the old banking systems and the advanced fintech technologies being developed and adopted at a rapid pace,” stated Dea Wilson, the Romanian founder of Lifograph. “[…] the cryptocurrency fever is sweeping up Romania, and more and more Romanians are switching to digital wallets”.
Romania’s conditions are favorable to a fintech boom. It has a relatively large domestic market and the second biggest population of the region. Its tech sector is also ready, with a large pool of IT specialists and the fastest broadband Internet in Europe. Furthermore, the Romanian government supports domestic companies and foreign investors through state aid schemes, tax incentives, deductions (up to 150%) for research and development investments and low corporate income tax.
Fintech companies providing technology solutions to banks are particularly in demand in Romania, as underlined by the Fintech in CEE report. The most sought-after solutions were frameworks enabling the agile development of customer experience in all channels, the reduction of regulatory reporting burden, and the facilitation of various forms of cloud services.
Regulatory changes, opening access to banking systems (e.g. PSD2), and e-commerce popularity growth will help fintech providers and solutions in the fields of online and mobile banking take on significant role in the Romanian financial landscape.
Local banks have started digitalization programs. In 2010, Banca Trsilvania integrated Finastra's FusionBanking Essence Online and Mobile, which allowed its market share to grow from 5% to nearly 9% in just four years. The bank also integrated social media into its digital banking with unique services, e.g. Facebook transfers.
Deloitte’s analysis estimated the value the Romanian fintech market at 119 million USD in 2016, behind Poland with 856 million USD, Austria with 588 million USD, and Czech Republic with 190 million USD.
