Mastercard recently completed a study focused on the fintech ecosystem in Malta. What inspired you to conduct an in-depth analysis on that topic?

Several compelling reasons led us to conduct an in-depth analysis of the Maltese ecosystem. Firstly, the Maltese Fintech domain has witnessed substantial growth over recent years, and this is a good indicator of a flourishing sector with further potential for significant development. We saw that there is a clear aspiration to position Malta, the smallest EU jurisdiction, as a leading regional Fintech Hub. This ambitious goal aims to foster innovation and drive economic development within the country, highlighting the potential for Malta to play a pivotal role in the Fintech landscape.

Following the preexisting wave of efforts to empower Malta’s Fintech community, through our study, we aspire to further support the continued growth and maturity of the sector, ensuring that it remains at the forefront of global trends and developments in the industry.

Ultimately, we aspire to support and further cultivate an environment that not only embraces Fintech companies in Malta, but also propels them forward. Together with existing initiatives, the outcomes of the study are intended to unite the relevant stakeholders of the Fintech ecosystem, create fertile ground for collaboration, spark innovative endeavours, and pave the path for the long-term success of this sector in Malta. We want to believe this initiative constitutes a testament to our commitment to foster growth and innovation within the realm of the Fintech ecosystem and reflects our dedication to nurture the potential of this dynamic industry in Malta.

As consumer expectations evolve and new technologies continue to emerge, the need for digital transformation is becoming increasingly urgent to maintain competitiveness. In what ways can traditional banks and fintechs establish mutually beneficial partnerships in this direction?

In the evolving landscape of financial services, the collaboration between traditional banks and Fintechs presents a compelling opportunity for mutual growth. Globally, we see traditional banks recognising the value of knowledge and expertise cross-fertilization. This recognition has led these banks to make further efforts to integrate solutions provided by Fintech companies, allowing them to reinforce their digital capabilities and elevating their value proposition with more innovative services and state-of-the-art technologies.

According to the Malta Financial Services Authority, just over half of the Maltese financial services entities have embraced digital transformation strategies. Increased collaboration between traditional banks and Fintechs can play a pivotal role in facilitating incumbents’ digital transformation efforts while enabling Fintechs to expand their distribution reach.

To accelerate digital transformation, banks could also consider proactive expansion in the Fintech space. In fact, by leveraging their domain of expertise and strategically reaching out to future partners and enablers, banks can advance their digital initiatives effectively and further integrate innovation within the financial ecosystem.

We should also note that the targeted banking-as-a-service model is designed to address some of the funding gaps that have emerged in the Fintech sector while enhancing traditional banks’ offerings with additional features and services. This approach creates a win-win framework, where Fintechs gain access to resources and traditional banks augment their digital capabilities. Moreover, through the acquisition of Fintechs, banks have the advantage of gaining access to valuable talent, cutting-edge technology, and products tailored to a digital-savvy customer base. This could not only accelerate the banks’ digital transformation but also enable them to stay competitive in an increasingly digital world.

Looking towards the future, what can we expect to happen in the fintech environment? Which trends and developments do you expect to affect the financial services industry and Fintech sector, setting the scene in the upcoming years both globally and specifically in Malta?

Based on our research as well as our understanding of the sector, the Fintech environment is expected to undergo significant transformation that will shape the financial services industry both globally and in Malta. Our study has identified several trends that are poised to exert a profound influence on the Fintech sector; digitalization, the adoption of cutting-edge technology, and a heightened emphasis on customer-centric approaches. Elements like Banking-as-a-Service (BaaS), Real-Time payments, and Buy Now Pay Later (BNPL) solutions are likely to play pivotal roles in shaping the landscape of financial services in the coming years.

In addition to industry-specific trends, the role of the public sector is expected to be instrumental in supporting Fintechs and fostering the payments ecosystem in a holistic manner. This support can manifest through regulatory initiatives, incentives, and collaborations that create an environment conducive to innovation and growth.

Malta’s enduring vision is to gradually position itself as a Fintech powerhouse, secure, and credible jurisdiction for Financial Services. This vision hinges on innovation and responsiveness, driven by a strong and agile regulatory framework and based on a robust technology foundation. Malta’s objective for the coming years is not only to enhance the service delivery within the financial sector, but also to improve the overall brand experience associated with the local financial services.

How is Mastercard supporting fintechs and other start-up companies with the deployment of their solutions and finding the best partner to support them in the process?

Mastercard is committed to playing a pivotal role in fostering growth within the Fintech sector by actively supporting Fintechs and startup companies in deploying their solutions and finding the best partners to aid them in this process. To this end, Mastercard has initiated several vital initiatives designed to empower Fintechs and startups on every step of their journey, and connect them with key ecosystem players.

The first initiative we are very proud of is the Fintech Forum Event Series. This is a series of events that connects Fintechs, Banks, Venture Capitalists (VCs), and other stakeholders, and spark collaborations for the evolution of the ecosystem. The second initiative is Mastercard Engage which focuses on the use of our network of partners to empower Fintechs to build and scale their technology and new value propositions. The third initiative is Fintech Express. This is our rapid card issuing programme tailored specifically to the needs of Fintech issuers. Last but not least, StartPath is Mastercard’s award-winning startup engagement program providing global support for startups by helping Fintech’s access strategic partnerships, co-innovation opportunities and engagement with Mastercard’s global network.

What would be your advice for a fintech interested in partnering with Mastercard?

Innovative Fintech and bold ideas should be supported by a partner whose belief and ambition match their own, and we encourage Fintechs to explore and engage with the resources, tools and solutions provided by Mastercard.

Whether you are a Fintech that is seeking the necessary tools for success, a supportive community of innovators, or the infrastructure to turn your ideas into long-term growth, Mastercard can provide you with the required solutions and expertise to help you succeed.