Lithuanian fintech is compact and agile, with Jekaterina Rojaka

It's only thirty years since Lithuania's broke free from the Soviet Union, but already it's home a buzzing fintech scene: "Leapfrogging was probably the largest idea behind the Lithuanian success". Join me and Jekaterina Rojaka, Chief Commercial Officer (CCO) at Creditinfo Lietuva, as we explore the roots of that success.

Creditinfo Lithuania can be found at https://lt.creditinfo.com/en/ or jump straight to https://lt.creditinfo.com/en/strongest-in-lithuania/ for award-winning Lithuanian businesses

But, as we've covered on this show before, they've got operations all over the world, so you can also head to https://creditinfo.com/ to find your closest office

On LinkedIn, you can follow them at https://www.linkedin.com/company/creditinfo-lietuva/ but they're also on Facebook and Youtube

And that's where you'll find Jekatarina, too: https://www.linkedin.com/in/jekaterina-rojaka-49909910/

LinkedIn is also where you’ll find me (https://www.linkedin.com/in/brendanlegrange/) and this show (https://www.linkedin.com/company/how-to-lend-money-to-strangers/) - so pop over and send me a connection request

My action-adventure novels are on Amazon, some versions even for free, and my work with ConfirmU and our gamified psychometric scores is at https://confirmu.com/ and on episode 24 of this very show https://www.howtolendmoneytostrangers.show/episodes/episode-24

If you have any feedback or questions, or if you would like to participate in the show, please feel free to reach out to me via the contact page on this site.

Keep well, Brendan

The full written transcript, with timestamps, is below:

Jekaterina Rojaka 0:00

When we talk about Lithuania, we're talking about a small but strong economy. Actually Lithuania is not a small country, it is big country compacted to your convenience!

It's easy to reach. It's pretty much all in one place. It's got great work life balance. Lithuanians are very agile. Lithuanians are very computerised, and they're very mobile. And for our size, we currently have 263 FinTech companies. They are working not only for Lithuania, they're working globally.

Brendan Le Grange 0:37

When I lived in Copenhagen, my wife and I aimed to travel to one new country per month on average - so sometimes one country in one month, a little weekend break, and sometimes two or three countries every few months. And one thing I grew to realise was that many of the European highlights were slightly snookered by a mix of familiarity and high expectations: the Eiffel Tower, yeah, looks exactly like the Eiffel Tower; the canals of Amsterdam are cool, but in exactly the way described; and the Colosseum, actually, the Colosseum really impressed me but you surely know what I mean.

So I started to develop a taste for places I knew less about: Budapest, Sarajevo, Lubeck, Tallin, Riga - the latter three playing a key role in Drachen, my first novel, which is available for free as an ebook on Amazon - and Vilnius, the capital of Lithuania. We loved Vilnius. It has a charming enough Old Town and has some lovely sights within easy reach - I think me in front of Trakai Island Castle is still my Skype profile since I forgotten how to change that - but that's not what made it so memorable. For us, what keeps it in our repertoire of travel stories, is that it was perhaps the only country we have travelled to where there was no standby team of fluent English speakers ready to bail us out of any situation.

We had to randomly point at menus, we had to mime an aeroplane to find the correct path to the airport, and we felt like we were really travelling. I'm about to hear how much has changed since then. Welcome to How to Lend Money to Strangers with Brendan le Grange.

Jekaterina Rojaka, Chief Commercial Officer at Creditinfo Lithuania, welcome to the show.

Jekaterina Rojaka

, your background is in macro economics, which is something I want to take advantage of in a minute. But before we get into that, would you mind briefly walking through your career with me talking about how you arrived at the current role you have at Creditinfo.

Jekaterina Rojaka 2:52

Hi, Brendan, hello, first of all, thanks a lot for inviting me. It's a huge pleasure to be with you here. Yeah, macroeconomics, that's been kind of a passion of mine for more than 15 years. I've started from the banking sector, I started from the Central Bank of Lithuania and then jumped to the commercial banks working for NORD/LB, Norddeutsche Landesbank, then two different banks. Also in the between I was working for the World Bank couple of years talking to most of the commercial clients, also individuals banking clients, about what is happening to the economy, how can we understand the trends.

And within an economy going through a roller coaster? Absolutely. We had many crisis. So explanation was needed. And explanation is needed sometimes even now.

Finally, in 2018, I actually started working for the public sector, which was totally different experience.

Brendan Le Grange 3:50

Yeah, indeed. So we're really here to talk about you as Chief Commercial Officer at Creditinfo, but I do want to take advantage, as I said, of that experience, you've got explaining the market, explaining the economy, because when I was doing some research for this, I was quite surprised to see that Lithuania is actually the biggest economy in those Baltic states.

But in its current form, independent from the Soviet days, only 30 years old, so as you said, a rollercoaster both, I imagine, in the short term and the longer term. So yeah, as former Vice Minister of the Economy, I can't pass up that opportunity to say, what is a quick history lesson? What does that landscape look like?

Jekaterina Rojaka 4:29

Yeah, well, I like the basics. So when we talk about Lithuania, we're talking about their small but strong economy; population 2.8 million people - so it's not extremely high - but with a labour pool of 1.5 million people. It's pretty agile. I would say, if we talk about the size of the economy, the GDP size is roughly about like Luxembourg or Croatia, maybe two times less than Ukraine, but Ukraine is a huge country while Lithuainia is a very... we don't like to say it's a small country actually, and we just held the NATO summit in Vilnius in July, so we had a very nice ad: Lithuania is not a small country, it's a big country compacted to your convenience!

That's Lithuania. It's not a relatively small country: it's extremely compact. It's easy to reach, it's pretty much all in one place. It's great work life balance. And that's why Lithuania is feeling kind of Renaissance for re-immigration.

Well, the Lithuanian GDP, if compared to 2000 it has grown five times, if compared to 1995 it has grown 8.6 times. So it was really, really expanding.

And most of these expansion is interconnection with the other countries. It's international trade. So more than 85% of our GDP is because of the trade, international FDI, etc, etc.

But you mentioned that Lithuania is only 30 years old of independence. But this integration comes centuries back. And Lithuania was huge sometimes and very integrated economically. And this helps us to leapfrog.

And leapfrogging was probably the largest idea behind the Lithuanian success. We are first place in European Union by the Greenfield FDI Performance Index. Also, I was personally very disappointed when the world bank decided not to renew it's Ease of Doing Business Indexes, because in 2019, Lithuania took its highest place - and at that point, I was Vice Minister of the Economy. And next year, we were forecast to take top five. But you know, the next year, COVID happened, and also the index was stopped.

But Lithuania is a free economy. In the Economis Freedom Index, we are number 12. And the most recent changes are pretty much associated with the financing sector of the fintechs. And the younger population that also jumped into the labour pool.

You just stop me somwehere, because I can talk about the basic figures and about micro economy quite a long time!

But the Lithuanian economy has a lot of different sectors, and the importance of the sectors is, kind of classic, I would say, as manufacturing is comprises roughly about 1/5 of the economy. Lithuania is pretty much in ICT. And the part of that is growing very fast. And there are a huge number of companies that preferred Lithuania for global business centres or ICT services such as Oracle or Uber or Revolut. There's really, really good brand names, worldwide brand names that are actually sitting in Lithuania and also helping our economy to extend.

Brendan Le Grange 8:04

Maybe it is just me, by the sounds of it, who wasn't aware quiet how well Lithuania was doing it!

I think you've mentioned a couple of words there: agile and integrated.

Two words that really are sort of brand names, almost, of the FinTech movement. And so maybe we can talk a little bit about the FinTech industry there because, yeah, maybe shouldn't be saying this but Estonia is the name that sort of jumps out from that region in terms of the FinTech boom, but again, maybe that's just me, not realising why it was happening.

So talk to me about that side of the economy.

Jekaterina Rojaka 8:36

You are very correct, Brendan, many technologies started in Estonia. But with a FinTech, well Lithuania is worldwide known for being as a FinTech hub. For our size. We currently have 263 FinTech conference. So it's really, it's really a large number. We have like 7,000 people employed in the FinTech sector, they are working not only for the senior, they're working globally, with 25 million customers all over the world and all over the Europe.

For them, Lithiuania is a kind of a tramp line to reach the huge European market.

And most of those fintechs is 1/3 of the companies are working with the payments, roughly about 70% on the Financial Services 10% in digital banking 10% in lending and in pretty much equal shares, then blockchain cryptocurrencies, big data, RegTech InsurTech and other different sectors or sub sectors. So fintechs for lithiumion they were a kind of a game changers, I can say for sure, because I was part of a classical banking sector.

Those disruptors were extremely good for the overhaul bank and sector but especially for the customers because customers comes first and customer knows the best. But also, it pushes more speed for this stabilised classical banking sector.

Brendan Le Grange 10:13

I guess that's where that leapfrogging comes in. It's in that time that the world was digitising the world was opening our borders as well. And seeing that that benefit there, which is fascinating to hear, and maybe brings me to the main subject of the day credit infos work within that space. So Jekaterina, how long has Creditinfo been in the country? And how does it fit within that landscape that you've been sketching for us?

Jekaterina Rojaka 10:39

Well, Creditinfo was established in 2004 - in terms of Lithuanian companies, it's quite old already.

And in the very beginning, it was the company that had to provide most of the and collect most of the data manually, going from one financial institutions to another financial institutions there with the pencil, and yeah, going through the list of people who are late in payments, etc, etc. So for those 23 years, Creditinfo was facilitating access to finance in Lithuania.

And for Lithuania it's the first and the largest credit bureau, and has their largest number and amount of data about both companies and individuals. We have like 1,300 business clients and roughly about 1/3 of working population in Lithuania are our clients.

We provide, and are used heavily by, commercial banks by the financial sector as well, credit unions, leasing companies, consumer credit companies, telecommunication companies and other companies will connect all the possible registers for the convenience of our customers. But again, the probability that you will be checked with the credit in for a data when you're applying for a credit, I believe, it's 80%... or even more.

Brendan Le Grange 12:03

Yeah, and it's not every country that we've got credit bureaus that cover both the business side and the consumer side, there's maybe we can start with the consumer side there is a comprehensive credit bureau with positive and negative data credit bureau score everything that we'd be familiar with in other markets.

Jekaterina Rojaka 12:21

Absolutely. So Lithuania has both parts of the stores its databases of negative data on also on the positive data, it combines both, but what has changed quite a lot since 2000. The core of our business today is pretty much this value added information from being our source for raw data to the provider of the Decision Analytics and to the decision making consumer ratings that we calculate from the different sources mostly from the negative information, because we are also very compliant with the GDPR.

So we are concentrating on the company's rating and the default rating the bankruptcy rating that again, fully TNA is very important. We've been through many bankruptcy crisises. During those 30 years of independence, we have very extensive economic cycles. We also have a ratings on their debt collection scores, it's QAC, it's definitely ESG and all the the decisions that are important for our customers from very different sectors.

And knowing again, what hadn't been mentioned in but it's a huge part of our nowadays routine. It's the Russian aggression towards Ukraine. And of course, quite a lot of Ukrainians came to Lithuania that we also have some products to integrate them into the economy new because now with more than one year being a residence or living in Lithuania, they can start applying for credit and settle down. So we do provide also information from our Ukrainian bureau.

Brendan Le Grange 14:06

Very timely today's, as we record this, there's actually a Ukrainian independence day. So perfect time to to be discussing that.

Jekaterina Rojaka 14:16

Yeah. And my parents are actually from Ukraine, so for me, it's definitely definitely a very special day.

Brendan Le Grange 14:22

What it also demonstrates, you know, the breadth of the products you offer is some of that enablement by technology that we have today were 20 years ago, a country of Lithuania size would struggle to have data available at the volumes we needed in those days to create all these different ranges of decisions. We might have had a basic credit score, but to be able to do all of these different data checks and to empower all these different decisions these days, I assume is helped a lot by all this sort of modern technology, the sort of FinTech that's been happening behind the scenes in credit info that different analytical and data tools that are now available.

Jekaterina Rojaka 15:03

Absolutely. Well, Lithuania is rich with data, I would say that in European context, we have very structured and long time series compared to our independent lifetime economically.

But again, what is beautiful while working in credited for because you are connecting all the dots, or you have access to their huge number of data, and you can provide those automatic decisions for the companies, the raw data and the value added information just in seconds, and not only from Lithuania, but also across the Baltic countries, because while the Baltic countries, they're very often working together and provided services for the Baltic region, despite all the differences in their data structure, and some cultural differences.

So now, definitely when you start business in Lithuania, it's much easier with the help or the credit even for and have it in one report or one API, which which we could only dream for, like 10 years ago.

Brendan Le Grange 16:11

Yeah, that's amazing. So I hadn't realised that. So is that sort of special requests? Or how does that data sharing work?

Jekaterina Rojaka 16:18

Well, usually provide services within the country, but since we have a lot of different Baltic companies, they harmonise the strategies across the Baltics, and every every single country and provides their similar structure of data. And again, the automatic decisions like ADM that we currently offer to our clients can make it's easily accessible just a couple of seconds collecting the data from all the Baltic countries if needed. It, probably the picture that we would like to see in the service sector for all European Union.

Yeah, that should come should come through. And we have been talking about that during the period that I was in the public sector. But again, the structure of the data is so different among the European countries. So this is the kind of advantage of having disadvantages in the beginning for the Baltic countries and, yeah, leapfrog.

Brendan Le Grange 17:18

Very much, it's because as you say, it's a fantastic model for what should be simple to do within something like the EU. But I've in a previous role was working with international regional divisions where we've said, okay, you know, as a region, surely, we could share some data. And it's been a nightmare, because it's been the old legacy systems built up in certain ways. And you've got to undo a lot of that or work very differently to try and work around systems that have taken 40 years to put in place.

Whereas when you've built them in agile ways, and modern technologies, you can leapfrog that something we can aspire to in other similar blocks around the world. You Ekaterina I want to talk to something slightly different. When I went to www.lt.creditinfo.com I saw Strongest in Lithuania a big button there on the on the front and clicked that. So tell me about what that series of awards or that competition is?

Jekaterina Rojaka 18:12

Strongest in Lithium is a kind of our brand name is our excellence certificate for the companies that are providing their financial statements. And the financial statements are sound in our environment, the companies became really thick skinned. Well, every company has its own peak, but the Everest is mostly for the strongest.

So the Lithuanian business business environment is created for all the companies but only the strongest and this flexibility to successfully go through the numerous challenges and kind of unpredictable situations and conditions that lithium and business environments presents, and will have different excellence labels, because some of the companies could be just startuppers. I'm working for several years, like three years old, and already showing them very good performance. Some of them enjoying this excellence in for decades. And some of them even from the very beginning of the credit team for history in Lithuania.

So those companies that have this certificate and have this award, these are the best companies of the Lithuanian market actually, it's kind of a prestige also for the smaller company to join the club. So we're very happy that crediting for a name is associated with the strongest companies is the guarantee that the company would be a good partner. So that's pretty much cream of the crop, the best of the best.

Brendan Le Grange 19:41

perfect so if anybody wants to go and see who's won those awards, or just more broadly, like me has been inspired about what's happening in Lithuania and what the potential there is. If people want to go and follow up on that they want to read more about credit info in Lithuania. where's a good place for them to go online to learn more?

Jekaterina Rojaka 20:00

So the information is definitely is easily provided by this Strongest in Lithuanian on the Creditinfo websites. But well, it's not only in Lithuania, it's also in the Baltics, and it's very popular in Iceland, too. And especially in the period of crisis. And when the market is looking for the new connection, this is their sign that you can easily jump into the international collections, which also helps to grow your business.

Brendan Le Grange 20:31

Now, it's a great point when you when you're looking at expanding, it's really helpful to have a name you can trust to at least a list of companies that have been certified that you can reach out to Jekaterina I've now I think you're the third guest from Creditinfo, one of the things I know about the company is that it's always got great blogs, it's got great material, if anyone listening wants to learn more about to creditinfo story, Where's, where's the good places for them to go to stay in touch?

Jekaterina Rojaka 21:00

Well, first of all, if we're talking about Lithuania, we can be easily found on any social networks, such as LinkedIn, or Facebook, with our popular products and our other information and definitely our internet page. But we are like in Lithuania, a very kind of compact country, and we know each other, at least at least through one more acquire acquaintance, you will definitely reach someone from the credit in for pretty much directly.

Brendan Le Grange 21:31

Yeah. And as you said, if people are not in Lithuania, it is very easy to reach. I recommend it as a holiday destination. It's not visitors as often as it should be. We had a really great time when we were in fullness. But yeah, go for business as well by by all accounts, Jekaterina before I let you go, you've mentioned about you know, the roller coaster the growth that we've been seeing in Lithuania and the broader region. As you look ahead, is there anything on the horizon anything that we should be following or keeping an eye out either in Lithuania or with the work credit infos doing there?

Jekaterina Rojaka 22:04

Absolutely. A roller coaster is pretty much not ending neither for lithium and or for the Baltics, people are kind of become an over optimistic during the cycles, and then over depressed during the downside. So I believe that in the extremely changing environment, you should keep your hand on the polls pretty much every single second. And that will keep you alive. And that will keep you strong and healthy.

Brendan Le Grange 22:30

Yeah. Wonderful message for everybody. Jekaterina thank you again for your time. It's been wonderful hearing about what's happening in Lithuania. And again, hearing the great work that Creditinfo is doing in another market.

Jekaterina Rojaka 22:40

Thank you very much, Brendan, for having me. And I also very much hope that now you learn about lithium a little bit more, but if you have any questions, don't hesitate to contact me directly.

Brendan Le Grange 22:50

And thank you all for listening.

Please do look for and follow the show on your favourite podcast platform and share the updates widely on LinkedIn where lending nerds are found in our largest concentration. Plus, send me a connection request while you're there.

This show is written and recorded by myself Brendan le Grange in Brighton, England and edited by Fina Charleson of FC Productions.

Show music is by Iam_wake, and you can find show notes and written transcripts at www.HowtoLendMoneytoStrangers.show and I'll see you again next Thursday.