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Where it is better to open a financial start-up?

2017-08-16

финансовый стартап

Financial start-ups are projects aimed at expanding and deepening the financial sphere with the help of modern technologies and innovative solutions. For their development, there are developed favorable conditions in many countries, and therefore such projects are considered as advanced direction.

Features of financial start-ups

Financial start-ups are called applications or technical solutions designed to make it easier for users to work with money. It can be:

• Interbank transfers without intermediaries.
• Accelerated money remittances.
• Applications for microinvestment.
• Financial services through smartphones (payment of utilities, various transfers).
• Services for storing money.
• Loans based on Peer2Peer.
• Electronic money, etc.

The advantages of such developments can be considered on the basis of microcredits. At present, depositing money at deposit accounts is not the most successful investment, since profits often burn inflation, not to mention the fact that the bank can be bankrupt. A more optimal solution is to provide microloans on the special platforms, where you can borrow money at high interest for a short time. Of course, there are risks, but the advantages are obvious.

The peculiarity of financial start-ups is that this sphere has just begun to develop, is quite risky, and the classical participants of the market (banks, financial regulators) treat to it with caution. This means that young companies have an excellent opportunity for advancement. Nevertheless, banks, social networks, some technologies have already implemented in own activities, so now it is the best time for medium-sized companies to enter to the market with a new, potentially powerful idea.

Basics of success

A successful project can only be built on a solid foundation. The following conditions must be met for successfully starting:

• An original idea is to find the problem that many consumers face and offer them a solution that users will like to taste.
• Continuous improvement - it is important not only to find the right project, but also be able to adapt to the market needs, if the start was unsuccessful. It is important to be able to quickly change, refine and improve the project.
• Correctly designed scheme of work.
• Successfully jurisdiction - even a very successful idea is able to die if the laws of the country where the company is registered do not allow the project to grow, and all profits go to taxes.

It is very important to initially determine the country where the company will be registered. Proper jurisdiction will save a lot of resources that can go to overcome unexpected difficulties in the implementation of the project and the subsequent redeployment. An example is PayPal, which moved from the UK to Luxembourg, because it decided that it would be more profitable to conduct business from here.

Where is it better to register a startup

In Europe, experts identify about ten countries that are good bases for a start-up. But if we talk about financial start-ups, it is necessary to understand that the requirements for them are more stringent, and therefore not every jurisdiction is suitable for development in this direction. For example, Germany is called as antagonist of innovation in the payment system sector, and in France it is difficult to conduct such a business. In some large countries, there may be problems with bank accounts opening, as banks are afraid to go to a meeting with unstable companies from their point of view.

Analyzing all market features, EPA specialists identified six countries that are well suited for the financial start-up development, especially payment systems. These include:

• Denmark.
• Ireland.
• Cyprus.
• Luxembourg.
• Malta.
• Sweden.

Luxembourg is the most respected jurisdiction for payment systems. But the cost of the license is expensive, which is bad for small companies: now the price is 20 thousand euros, and soon it is planned to double it. For comparison: in Malta, the license will cost 3.5 thousand euros.

When you start during the selection of jurisdiction, you need to consider this point, as well as what is more important for the company: low taxes, beneficial laws, the availability of qualified personnel. It is also important to consult with financial expert who will recommend the country where the bank account will be most easily opened.