The state of FinTech in Greece

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Historically known as Hellas, Greece enjoys a strategic location on the world map as it is at the crossroads of Europe, Asia and Arica. Situated at the Southern end of Balkan Peninsula, Greece shares its land borders with Turkey in the Northeast, Republic of Macedonia and Bulgaria in the North and Albania in the Northwest. Its remaining border opens in the Aegean Sea to the East, the Ionian Sea to the West, the Cretan Sea and the Mediterranean Sea to the south.

The country’s historical and cultural prominence in the field of art, literature, philosophy and politics still dominate in the western world. Gifted with bountiful nature, Greek’s 80% area is mountainous, and its coastlines are 11th longest in the world. After World War II, tourism and shipping emerged as the backbone of the economy. However, the global financial crisis post-2000s crippled the country and brought it under heavy international debt.

According to Worldometers.com, based on United Nations estimates, the current population of Greece as on February 7, 2017, is 10,903,377, which is equivalent to 0.14% of the total world population. It is ranked 85th in the list of countries by population. The population density is 85 persons per sq km with 80.2% of the population in urban areas. The official census of 2011, estimates the population of Greece as 10,816,286.

Greece is among those few countries where the population is on the decline. The fertility rate, which should be about 2.0, has gone down to 1.1 to 1.3 and it’s a cause for concern for the policy makers.  66.2% people in the country are in the age group of 15 to 64. About 98% population is literate with males slightly higher than females. The unemployment scenario has been improving in the country since May 2013 when it hit as high as 27.90%. Today, it stands around 23%. According to Education and Training Monitor 2016 of European Commission, “Performance is disappointing on basic skills attainment by young people and adults, and on participation in vocational education and training as well as in adult learning.”

Startups Scene in Greece

Like other Balkan countries, startup scene in Greece looked up in 2012 with the support of Jeremie money – the joint financial fund of European Commission and European Investment Fund. Greek startup ecosystem owes everything to Jeremie fund which has encouraged youngsters’ entrepreneurial activities. Successful startups companies like YouScan, a social media management platform; E-foof.gre, the largest online food delivery aggregator; Tracelplanet24 and AirTickets.gr, online travel companies that offer cheap airline tickets to tourists across the globe, have grown bigger with the help of Jeremie fund.

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Even upcoming startup firms which look promising such as Forky, a mobile platform of food delivering; Nannuka, that helps parents find reliable childcare; Goodvid.io, the e-commerce startup that offers world’s best user-generated product for online retailers; Pockee, a unique app for supermarket coupons; and Wappier, a mobile technology startup all have got initial hand holding from the Jeremie.

The Jeremie fund has dried up now, but it has helped create a generation of entrepreneurs who can inspire newcomers and encourage private funds to invest in startups. The struggling financial situation in the country has taught entrepreneurs to adapt to the situation and move from strength to strength.

Instead of focusing on local investors, startups have adopted global perspective so that they can attract foreign funding and consumers. Most of the startups have got themselves registered mainly in USA or UK with their headquarters in Greece. This helps them get funds and serve to a global community.

About 60% to 70% startup focus on tourism and transportation sector which is the traditional financial backbone of the country. Companies like Truckbird, Nestcargo, JoinCargo, Trustporter, Offerial and Tourismart provide online marketplaces to help customers find shipping carriers and instant access to all hotel, tours and travel services on the go.

The latest trend in startup sector is biotechnology, solar energy, health and medicine as, of late, some entrepreneurial online platform such as Bionic Healthcare, CareAcross, Respi and Lighthouse Solar Systems have come up.  It’s due to the emerging ecosystem of incubators, venture capitalists and university entrepreneurship programmes that more than 1000 startups have registered in various sectors including aerospace and mobile applications.

How big is the FinTech Pie in Greece:

Fifty-sixth ranking of Athens among top sixty cities in 2016 in European Digital City Index shows FinTech sector has been emerging from its nascent stage in the country. All thanks to capital control measures introduced by the Greek government in July 2015 to monitor the liquidity situation in the country as it let people realise the importance of the financial technology companies and startups. During the period capital control remained in existence, FinTech firms helped people transact money digitally.

Though capital control was a painful experience for the majority of the population, yet, it brought people’s attention towards digital banking and financial services in a big way. Individuals along with all categories of business establishments looked for electronic means of banking and payments.  News reports suggest that during this period the country experienced 40% rise in the card payment. It was perhaps for the first time that people talked about the importance of bitcoin too.

Among others, highly educated engineers and software developers also deserve credit for their role in the growth of a FinTech ecosystem. Experts believe that the financial crisis might have caused many difficulties to people, but as it is said ‘every cloud has a silver lining’, it has driven talented and educated youngsters, who became jobless, to start their venture. Their enhanced risk-taking ability and entrepreneurial drive led to some successful FinTech ventures such as Viva which offers digital payment and e-banking services, Elorus, which is a new online invoicing & billing software and Billit.io which also helps people do various financial functions.

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Soft Web, which specialises in mobile applications and the delivery of integrated technology services, is one of the oldest tech startup registered in 2007. In the insurance-tech sector, companies such as Hellas Direct and InsuranceMarket.gr offer online insurance services for vehicles along with other related services.

Status of policy regulation in Greece:

Political uncertainty, tax increases and stiff regulations have posed many challenges for the startup and tech community in Greece. Political uncertainty, tax increases and stiff regulations have posed many challenges for the startup and tech community in Greece.

To bring the attention of the government towards the challenges of the startup communities, some entrepreneurs along with small and micro enterprising companies have formed a Greek Startup Manifesto which seeks to address their concerns.

The manifesto demands simplified tax framework which shouldn’t change on annual or bi-annual basis, natural process of business incorporation, affordable access to broadband networks and cloud computing facility, government finance for innovative startups, incentivize angel investments, elimination of the condition of collateral and a letter of credit guarantee in high risk co-funded projects and support for startups to access foreign markets.

Experts believe that sooner or later the government has to relax banking norms and companies’ incorporation process because, in the digital world, it can’t ignore the importance of financial technology.

Startup Incubation Scene In Greece :

Many startup communities, co-working spaces, business incubators, innovation hubs, tech conferences and forums have sprung up in past couple of years in Greece. Many startup communities, co-working spaces, business incubators, innovation hubs, tech conferences and forums have sprung up in past couple of years in Greece. Many startup communities, co-working spaces, business incubators, innovation hubs, tech conferences and forums have sprung up in past couple of years in Greece.

Global support regarding corporate sponsors and charity foundation is available. They also play the role of forums and hubs in inviting international speakers, who mentor tech startups on issues ranging from entrepreneurship to fundraising, branding, marketing and handling their legal issues.

Openfund was the first seed accelerator in Greece which played a significant role in extending financial support and advice to young entrepreneurs. Accelerators such as Metavallon helped fledgeling startups grew and earned investments from local and global firms.

Some of the startups Metavallon supported are Roadcube, an app to help get best services for vehicles, myiArts, an online art exhibition marketplace and liateR, an interactive sales solution for apparel retailers and brands. Other significant accelerators and incubators support come from MIT Enterprise Forum Greece, HIGGS (Higher Incubator Giving Growth & Sustainability) Incubation 4 Growth, Stage2, The Athens Center for Entrepreneurship and Innovation-ACEin. Besides, four banks have also offered programmes to either fund or incubate startup initiatives.

Current status of financial regulation in Greece:

The formal financial system can be traced as early as 1841 with the establishment of the National Bank. Today, it’s the country’s oldest and largest commercial bank. The formal financial system can be traced as early as 1841 with the establishment of the National Bank. Today, it’s the country’s oldest and largest commercial bank. The formal financial system can be traced as early as 1841 with the establishment of the National Bank. Today, it’s the country’s oldest and largest commercial bank.

Bank of Greece plays the role of a central regulator which implements norms of setting and functioning of other banks. Many banks went defunct due to the financial crisis. However, those who realised the potential of digital services embraced financial technologies and enhanced their customer base.

Today, all banks in Greece offer banking services on internet and mobile. They have also come up with new reward and loyalty programmes to encourage clients to use e-Banking or M-banking. They are also working on other innovative financial products, latest among them is mobile applications for peer-to-peer micropayments.

So instead of being a threat to the banking sector, FinTech firms are rather getting inspiration and assistance from it. A couple of international companies such as Helsinki-based Holvi and Berlin-based NUMBER26 have started their e-banking and m-banking services with considerable success.

Conclusion:

Financial technology sector is still largely unexplored, and considering the country’s liquidity situation, it is imperative that more and more people should join the FinTech revolution. Financial technology sector is still largely unexplored, and considering the country’s liquidity situation, it is imperative that more and more people should join the FinTech revolution. Curb on withdrawal witnesses long queue outside ATM and banks.

Financial experts say if a product is innovative, exciting and consumer friendly, there is no reason why people availing financial services will not adopt it. There is an enormous scope for fintech companies to come out with out-of-the-box financial solutions.

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