Many leading international fintech players have also been attracted to locate here, including UK neobank Monzo which has just announced its intention to use the State as the base for its European expansion plans.

“We see growth in fintech as threefold: Irish start-ups, overseas start-ups coming here and established financial services players digitalising their businesses,” says Patricia Callan, director of the Ibec industry group Financial Services Ireland.

“With the UK outside of Europe, companies there will need a base to passport their products and services into Europe. Other fintech companies from outside Europe will also want to use Ireland as a base. Financial services firms are on a digital journey to satisfy customer demand and we are seeing them put innovation hubs here. A strong ecosystem is developing here.”

That growth has seen the State become an international hub for this relatively youthful industry.

“Ireland’s large international financial services industry, combined with the vast skills and expertise within the tech sector and our strong position as a hub for international investment, has created a fertile environment for the start up and growth of fintech companies,” says Féilim Harvey, partner and banking sector leader with PwC Ireland.

“As the financial services industry as a whole moves to digitalise, collaboration between traditional financial services institutions and technology companies has become a well-established business model. This allows businesses to focus on their core strengths and capabilities. This is driving innovative new products and services as well as an enhanced customer experience.”

It is developing its own dynamic, he adds: “Perhaps most encouragingly, as this hub or ecosystem has matured in Ireland, it is now driving a greater culture of innovation and entrepreneurship. As a result, we are seeing more and more indigenous fintech enterprises grow and succeed from Ireland.”

KPMG head of financial services and regulatory Ian Nelson points to some of the Republic’s strengths when it comes to fintech development and growth.

“Ireland’s unique combination of talented people with strong technology and finance backgrounds and proactive state support has enabled a wave of start-up companies to prosper and develop their potential in a highly pro-business environment,” he says.

Regulation

Regulation is also important, according to PwC Ireland fintech and payments leader Nicola Sheridan.

“Ireland has a supportive regulatory environment for fintech and the Central Bank of Ireland (CBI), whilst very focused on maintaining financial stability, has been proactive in creating a regulatory environment that supports innovation,” she observes.

“The CBI’s Innovation Hub allows firms using new and innovative technologies to navigate the regulatory landscape. Regulation has also been a significant driver of the growth of a broader ecosystem of businesses who provide innovative tech-driven solutions to regulated businesses to help them manage their vast, and growing, regulatory requirements.

But, as all the best business books advise, what got us here won’t necessarily get us to where we want to go.

“While we have some amazing Irish success stories, more can be done to keep Ireland at the vanguard of new, fresh fintech development as we seek to compete with an increasing number of other locations,” Nelson contends.

“It’s important for Ireland to continue to invest in and support fintech companies and start-ups, creating an environment that allows them to flourish. Leveraging our highly skilled, educated workforce and ensuring we have a regulatory framework that encourages innovation while placing consumer protection at its centre is key.

"With enhanced collaboration and focus, Ireland can continue to thrive as a global hub for technology and financial services. The development of an IFSC 2.0 for fintechs could be a good option.”

Callan believes the establishment of a physical hub for fintech start-ups and other players is needed to preserve the Republic’s strong position.

“France has Station F in Paris,” she notes. “It’s a converted railway station for fintech and other tech start-ups. In Ireland it would be like the IFSC, a place where fintech start-ups can establish themselves and could have structured engagements with larger firms to solve problems.

“Ireland has a great reputation as an international financial services centre but everyone else wants that gig now. Everyone else is getting better and we need to respond. The physical fintech hub is the way to go.”

Sheridan supports the concept, saying: “The establishment of a one-stop shop for fintech firms, from the earliest stages of a start-up to established business, both indigenous and international, would provide firms with access to sectoral experience and expertise, opportunities to network and collaborate, and would create a community where the sector could continue to innovate and thrive.”

'Controlled environment'

Regulation should also be an area of focus, she adds: “Continued enhancement of the Central Bank of Ireland’s Innovation Hub as well as its plans to establish a regulatory sandbox will drive increased innovation by allowing fintech firms to test new products and services in a controlled environment.”

While noting that the regulatory environment has created significant opportunities for fintech companies to provide innovative solutions that simplify and improve regulatory compliance, there is another side to that coin.

“We can help newly established businesses to understand and comply with the significant regulatory burden and this can provide an accelerated opportunity for early stage fintech companies to grow,” says Sheridan.

Nelson sees some threats on the horizon. “Ireland’s leadership in the fintech sector has the potential to be challenged by regulatory changes, talent shortages, housing availability and technological disruptions,” he says.

“Staying alert and mitigating these risks where possible is crucial. Enhanced regulatory frameworks, continued investment in education, increased focus on innovation and building economic resilience will all play a part in maintaining our competitive edge. A central hub for fintechs at a national level could play an important role.”