Finance Luxembourg is a successful international financial centre. The country’s fintech industry is growing fast and an increasing number of start-up as well as established companies are innovating in this highly challenging field. Innovation in financial services is on top of government’s priority list to ensure Luxembourg’s position as a global competitive fintech hub. Luxembourg is the world’s second largest centre of investment funds through its pre-eminent role in the European market and as service provider in Asia, the Middle East and South America and the largest centre of private banking in the Eurozone. Its expertise also extends to life insurance and reinsurance. Over the course of the last 20 years and today the Luxembourg financial centre has been broadly diversifying its activities and have seen the development of other services, mainly related to information and communication technologies (ICT): data centres, cybersecurity, cloud computing, big data, mobile payments, trading platforms, P2P lending and crypto currencies, for example. Innovation in financial technology has the potential to completely redefine the financial services sector. Fintech - a growing and challenging market The development of fintech in Luxembourg is part of a natural logic. Financial players are present as well as technological skills. At present, there are around 150 fintech companies in Luxembourg, with roughly half of them providing IT infrastructure or IT services and the other half providing software or technology-based business services. 20 of the top 100 global fintech companies are installed in the country, such as Amazon Payments, Rakuten and PayPal for example. The majority of fintech companies are established firms of foreign origin, setting up in Luxembourg to benefit from the close proximity to clients and from the necessary talent pools, both in finance and technology, to develop their business. Successful indigenous fintech companies include, among others, Digicash, Mangopay, Yapital, Coinplus and KYC3. A governmental priority and a favourable environment With its "Digital Lëtzebuerg" strategy launched in October 2014, the government put innovation in financial services on top of its priority list. Government and industry experts’ work together to make the country more attractive to innovative high tech and financial companies and improve the regulatory framework. Fintech companies benefit from a best-in-class ICT infrastructure, in which the Luxembourg government has invested and strategically developed over the past decade. Luxembourg has one of the most modern data centre parks in Europe, including 40% of all Tier IV data centres in Europe. The economic environment, the flexibility to adopt new reforms and the fiscal framework of the country along with the access to finance and expertise available are as many reasons to make the country a fintech and virtual currencies hub. The attractiveness of the Luxembourg fintech ecosystem is also crucial, including access to a whole range of business services such as incubators, law firms, service companies, IT hosting companies and of course the presence of the "Big Four". The multilingual and skilled workforce is also a major asset. Research and technology excellence Luxembourg is investing heavily in ICT research in order to build scientific excellence. The Interdisciplinary Centre for Security, Reliability and Trust (SnT) at the University of Luxembourg puts the country on the worldwide map in terms of high-quality research in secure, reliable and trustworthy ICT systems and services, fields that are essential for the financial sector.