Financial technology innovation in Luxembourg has accelerated rapidly since the turn of the millennium. This growth in the use of new technologies applied to finance has been led both by players in the sector who have been established in the Grand Duchy for decades, and by new international players who have established themselves in the country in recent years to offer innovative services and generate more efficient models for the industry.

One good example in this regard is Luxembourg’s emergence as a centre for international cross-border payments. Since Paypal obtained its banking license in 2007, many other leading payments firms have chosen Luxembourg to be their EU hub. So much so that the Emerging Payments Association established its European base in Luxembourg in March 2020 to support the local and international payments sector on its unstoppable growth path. 

The Grand Duchy offers companies in this sector an excellent regulatory framework, a developing Fintech ecosystem as well as a last generation IT infrastructure.

A significant number of Fintech companies in Luxembourg focus on serving the regulatory and compliance needs of global finance: ranging from KYC and fraud detection, data management, to fund reporting and investor information tools, as well as digital investment services and online platform provision for financial services. This is complemented by an array of Fintechs, many in the B2B space covering other sectors, such as asset management, tokenisation and capital markets technology, InsurTech and more. 

In Luxembourg, The Luxembourg House of Fintech (LHoFT) is the main local body focused on the promotion and development of Fintech startups.  

Besides the LHoFT, Luxembourg is home to a number of incubators and accelerators, which help to ensure that the country stays at the vanguard of the latest technology developments in the field. They include:

• The University of Luxembourg operates its own incubator on its Belval campus in support of its entrepreneurship programme for students. 
• The House of Entrepreneurship is Luxembourg’s one-stop shop for company creation, providing assistance with business permits, tax& legal issues, as well as public funding. 
• The Luxembourg House of Start-ups (HoST), a start-up hub located in the centre of Luxembourg City, offers comprehensive support for new entrepreneurs 
• Technoport is an incubator that offers support programs for international entrepreneurs with technology-based and innovative projects.

In addition, the country offers other incubators and acceleration programs promoted by the private sector.

Recently, the Luxembourg government launched the  Startupluxembourg.com, platform to facilitate access to information for international entrepreneurs interested in setting up an innovative project from Luxembourg. This project aims to act as a coordination point for the different actors, projects and initiatives that Luxembourg is developing to support startups.

To promote innovation in the sector, Luxembourg offers a wide range of programs and activities focused on mentoring and access to financing for Fintechs. This section lists some of them, all open to the participation of international companies. These initiatives provide the ideal framework to get in depth into the Luxembourg Fintech ecosystem and identify international business and development opportunities. 

On the other hand, the country offers a favorable context for attracting global talent due to its multiculturalism and quality of life. More than 170 nationalities coexist in Luxembourg, and its citizens speak an average of 3.6 languages. Its position as one of the most important financial centers in Europe gives companies in the sector access to a network of highly qualified professionals in the field of finance.