FinTech in Norway: The Rise in Financial Innovation

Known for its oil and gas production and seafood industry, Norway isn't best known for its startup scene. But could that be about to change with a push into FinTech?

Those of you living in Norway will know the country is highly digitised. Banking has been digital ever since I moved here, but things have really moved on in the last few years.

I almost never use cash. In fact, I actually had to go to an ATM to withdraw some cash so I could show off the Norwegian banknote designs at a recent talk. That's because I never carry any!

I use the banking apps on my phone, and I send and receive small amounts of money between friends using Vipps. More on Vipps later.

The Nordic region has emerged as a leading player in the development of FinTech solutions and companies. Within the region, Norway hasn't had the success of some of the other Nordic countries, but that could be about to change.

What is Fintech?

First of all, let's back up a bit. FinTech stands for financial technology, and is an umbrella term for everything to do with technological solutions within banking, finance, and payments.

From online banking to your bank's smartphone app, from mobile payment systems to AI-based customer assistance, Fintech covers a wide-range of digital technologies that we use, or will use, every day to manage our personal finance, and within the business world too.

Regulatory changes such as PSD2 and MiFID 2, and new technologies such as blockchain are rapidly changing the landscape for companies in FinTech. New systems are being developed, and new business models are sought.

Major banks are being disrupted, and the way both individuals and businesses interact with their money is changing. Global investments in fintech between 2010 to 2016 hit $70 billion, so there is massive opportunities there for the right projects.

FinTech in the Nordics

The Nordic region has emerged as a key player in the fintech sector, each country contributing distinct strengths.

Finland's startup ecosystem is vibrant and early-stage focused, often looking abroad for funding due to its small market.

Denmark's well-developed digital infrastructure and design aesthetics stand out, alongside a fintech community that thrives on mutual trust and rapid knowledge exchange.

Sweden benefits from a strong collaboration between innovators, government, financial institutions, and startups, accelerated by a tech-savvy population that is keen on adopting innovative solutions. So, what about Norway?

Norway's Strengths in FinTech

Norway's FinTech landscape is characterised by a strong collaborative spirit, fostering synergies among startups, established financial institutions, investors, and research bodies.

This cooperation is buoyed by Norway’s world-class payment system, epitomised by Vipps, known for its efficient and straightforward solutions. This culture of collaboration, rooted in a long-standing tradition among banks and insurance companies to work together, creates a fertile environment for innovation.

The national fintech cluster, Finance Innovation, enjoys robust support from a wide array of stakeholders, including traditional financial institutions and regulatory bodies.

However, challenges persist. Norwegian FinTech startups often face hurdles such as limited access to capital and regulatory support, lagging behind their Nordic counterparts.

Despite these challenges, Norway's traditional financial sector is keenly aligned with FinTech advancements and the burgeoning AI revolution.

FinTech Companies in Norway

The Norwegian FinTech sector has experienced rapid growth and development since 2016, expanding from fewer than 30 companies to over 180 by 2023. Despite this growth, the sector primarily consists of small startups and early-stage companies.

This surge is fuelled by Norway's highly digitalised banking and public sectors, advancements in technologies such as AI, machine learning, and blockchain, and evolving financial regulations like the EU’s PSD2.

Investor and startup accelerator TheFactory Accelerator & VC actively tracks these developments through its quarterly Norwegian Fintech Map, highlighting the proliferation of new fintech startups and focused accelerator programs.

Unlike its Nordic neighbours, Norway does not have any FinTech unicorns, but there are several fast-growing companies.

Norwegian companies Vipps, Signicat, Two, MEA Wallet, Firi, Exabel, and Zwipe are among the names to have made a mark on the international stage to date.

Vipps

In the payments sector, Vipps stands out as Norway's leading FinTech company, having achieved significant traction and market penetration.

Offering user-friendly P2P payments, invoice management, and e-commerce solutions, Vipps rapidly amassed a user base of over four million people in Norway.

In the fourth quarter of 2022, the EU Commission approved the merger of Vipps with Denmark's MobilePay, creating the new Vipps Mobile Pay.

This merger expanded their combined user base to over 11 million, making Vipps Mobile Pay the largest mobile wallet and payment solution provider in the Nordics.

Aprila Bank

Founded in 2017, Aprila Bank is revolutionising SME banking with its digital banking services.

The bank streamlines customer onboarding to mere seconds and leverages live accounting data and machine learning to automatically generate financial offers and assess risk when invoices are created.

Through partnerships with leading ERP and accounting system providers, Aprila offers targeted SME financing.

Exabel

Established in 2016, Exabel is an analytics platform that empowers investment professionals to integrate alternative data and advanced data science tools into their investment strategies.

Its SaaS platform supports discretionary managers with hypothesis analysis, predictive modelling, and backtesting, enhancing data-driven investment decisions.

Settle Group

Founded in 2010, Settle Group offers versatile payment solutions for retail and corporate sectors. Its platform supports various funding sources and use cases.

The Settle app and Settle for Business enable instant mobile transactions and digital payments across 22 European markets. Recently, the company secured funding to expand further in the EU.

Signicat

Signicat is a digital identity service provider (DISP) and one of the leading providers of e-ID and e-signature solutions in Europe.

The Trondheim-based company's digital identity platform features more than 30 electronic identity methods, AML/KYC compliant onboarding, mobile app-based authentication, and advanced electronic signing.

Introducing ‘FinTech Norway'

A clear indicator of the industry's maturation is the establishment of FinTech Norway, an industry organisation formed by Norwegian FinTech companies. This organisation is dedicated to enhancing the regulatory and operational framework of the FinTech sector.

Founded in 2020 as an initiative to accelerate work with PSD2 and Open Banking, the association quickly grew to become much more. Today the organisation represents every industry within FinTech in Norway.

FinTech Norway is connected to a broader European network through its board membership in the European Digital Finance Association, ensuring that the voices of its members are represented at the EU level in Brussels.

Membership is by application, and is restricted to FinTech service companies that are independent and not controlled by a financial institution. Networking events are held throughout the year.

Norway FinTech Festival

Organised by the non-profit Norwegian FinTech cluster NCE Finance Innovation, the Norway FinTech Festival will be held in April 2024.

Over three days of expert talks, workshops, and entertainment, the organisers promise “a FinTech event like no other” with something “fresh and exciting.”