Didzioji 5, LT- 01128
FINANCIAL SERVICES, REAL ESTATE & TOURISM Neringa Rastenytė, NEWSEC
Vincentas Zabulis, SAVY
Gary Tuck, Baltic Film Services
Daiva Žumbakienė, Raimda auditas
P2P Lending takes off in Lithuania thanks to SAVY
Gaining Tax Credits by investing in Film
New Year Changes in accounting for Lithuania
issue No. 52
BCC welcomes Claire Lawrence, the new British Ambassador to Lithuania
New Promising Chapter for the Baltic Commercial Property Market
The Here and Now
Learning the lessons of the past, Lithuania’s government seeks to expand the financial sector without falling into previous bad habits. An interview with Lithuania’s Minister of Finance, Rimantas Šadžius. In terms of areas that need improvement, I would identify the need to increase diversification of Lithuania’s financial sector. Greater sources of funding that would complement bank lending would be very useful to ensure greater access to finance, particularly by SMEs. Such diversification of funding would also make Lithuania’s economy more resilient to any external shocks in the future. What would you say are the government’s current policy priorities for the financial sector?
Minister, what would you say are the particular strengths and weaknesses of Lithuania’s financial sector? The main strength of our financial sector lies in its resilience and adaptability, which has been demonstrated in the face of the global financial crisis.
The government’s current policy priorities in this area rest on two pillars: one, successfully steering the banking sector into the structures of the Banking Union (as part of its integration into the euro area, which Lithuania joined in 2015); second, is the development of Lithuania’s capital market. The first track is almost complete as our banking sector is already covered by the Single Supervisory
Mechanism (the ECB directly supervises three largest banks) and the elements of the Single Resolution Mechanism will take force from next year (e.g. Lithuanian banks will make payments to and correspondingly will be insured by the Single resolution fund. On the capital markets front, a concrete set of proposals are currently being considered by the government in the areas of public and private placement, enhancement of collective investment funds and crowdfunding. Specific legislation in these areas is being prepared. The current priorities also include the use of financial engineering principles in employing EU structural funds in Lithuania. How do you see LT’s financial sector evolving over the next 10-15 years? Firstly, I see that the banking sector will have to (and has actually started already) follow the global trends: in the era of digital technologies more and more of the banking services will go online.
In addition, the banks will have to offer new innovative products and financial instruments to stay competitive against non-bank service providers. Secondly, I see the expansion of Lithuania’s capital markets. We are working on measures that would encourage companies to explore more equity debt financing on the one hand, and on the other, increase choices for retail and institutional investors. My hope is that this will help our stock market to grow as well. Lithuania is also a booming arena of start-ups. Currently, we support this area by directing EU funds through risk capital to reach these innovative companies. After the EU’s support fades, when the current financial programming period ends, my wish is that this sector will become more selfsustainable. The EU wide project of the Capital Markets Union (CMU) will also inevitably impact Lithuania’s financial market via the availability of innovative financial instruments (e.g. securitization, crowdfunding) and better access to the EU’s single market for capital. continued on page 4 >
Data Security: How to Recognize and Prevent Identity Fraud
Western Union - 5 years in Lithuania For those of our readers who are not familiar with the first steps of WU as an investor five years ago, could you elaborate on the company’s initial plans and where it is today? What are the key factors for the company’s tremendous growth and success?
What should we do to protect our identity?
John Cannon, ‘Callcredit Information Group’ Fraud & ID Director
Though modern technologies help us in our daily lives and in business, they are increasingly turning against us in threatening ways. Fraudsters use modern technologies to perform a range of crimes, and people have begun to feel insecure. Recent studies say that more than 9 in 10 Brits (93%) have concerns about the safety of their personal information. Moreover, four in ten people (38%) have been a victim of fraud themselves. Nevertheless, more than half of British people (53%) admit that they throw away letters containing personal information without shredding them first; nearly a quarter of people (23%) have loaned their credit card to someone else at least once; more than a fifth (22%) have saved their PIN on their mobile phone, and 16% keep their PIN written down in the same place as their card. Thus, people are not aware of need to protect their identity, and they fail to do so. There are no studies regarding the number of people and companies that do not protect their personal data in Lithuania; however, it is very likely that the numbers are similar to those in Britain.
“The act of identity fraud is when someone intentionally acts dishonestly for their own personal gain using information belonging to another person without his or her knowledge,” says John Cannon, Fraud & ID Director of British consumer data management company Callcredit Information Group. “For example, if a fraudster applied to a bank for a loan using your identity, if they accessed your online bank account by pretending to be you or if they made a payment using your credit card”. All companies need to take steps to protect information they hold about their employees and their customers. All personal data must be held in a secure and regulation-compliant manner and companies must spend money to ensure that data is protected. There have been many instances where companies have lost personal data through their systems being hacked or through employees accessing data they shouldn't have access to. According to John Cannon, the reputational damage can be significant. Moreover, regulators also take action against companies deemed to have breached their security requirements. “There are many ways to secure interactions with customers, by using tools and solutions that establish trust and detect fraud. Techniques include validating and verifying identity, verifying payment details and linking them to the identity of the customers and verifying other attributes such as the device or mobile phone the customer is using, their email address or phone number.”
BCC SPONSOR MEMBERS
continued on page 4 >
When Lithuania was selected five years ago, we were attracted by the large talent pool of highly educated and skilled professionals, the good Western Union, a leader in global technical infrastructure, a stable political climate payment services established its and professional investment environment.
operations center in Lithuania in 2010 and in five years has created nearly 1500 jobs. On this occasion, the British Chamber of Commerce is talking to Kendra Ricenbaw, Managing Director of Western Union Processing Lithuania
Through these five years we have expanded 6 times from the initial plan of 250 employees to almost 1,500 employees today. In fact, during this time, WU’s centre in Lithuania has experienced the strongest growth of any WU employee site.
We started to provide the backbone of Western Congratulations on five years of operating in Union’s cross-border platform with Anti-Money Laundering Compliance, Accounting and Finance, the Lithuanian market! How does it feel? Information Technology, Operations, Digital Thank you. When we chose to come to Lithuania Operations & Distribution and more. We also help to establish our European Operating Centre five engage WU employees and customers through years ago, this market was relatively new to us as Human Resources, Marketing and so much more. a global investor and employer. Since then, our decision to develop in Lithuania has proven itself. Due to the great work and skills of the WU Our site is recognised by our colleagues abroad Lithuanian team, we have not only grown in size, as a place where processes are improved and but in scope. In five years we have expanded results are achieved. We are called “The Centre beyond our initial transactional based processes of Excellence” which I believe is a name we earn into new, more complex roles such as business every day. Our European Operating Centre is development, marketing, big data analytics, now Western Union’s largest office in the world, pricing analytics, customer insights and user representing approximately 13% of our total experience specialists. workforce. And we are proud to create high value continued on page 5 > jobs in Lithuania.