Answer ... In our view, the payments sector (e.g., Vipps, Payer, Finte, Vippicash, ZTL Payments, Meawallet, Bill Kill) and the financial infrastructure sector (eg, Neonmics, Zeipt) are the most embedded in the Norwegian market. Vipps is one of the most successful fintech entities and has become an important part of the digital banking system in Norway, especially within the consumer market. Historically, Norway has been at the forefront of digital banking and financial infrastructure – not least thanks to the development of common financial infrastructure and a secure electronic identification and signature solution through BankID, which is used across the finance and public sector. The BankID issued by one bank is automatically accepted by another bank or the public. This environment has created strong talent pools and several fintech start-ups are now emerging.

Many new banks have also emerged on the Norwegian market (eg, Monobank, Aprilia Bank, Nordic Corporate Bank), focused mainly on small and medium-sized corporates and new intermediate platforms (e.g. Capassa). The aim is to modernise the customer experience and develop new services for a generally under-serviced segment. New banks and finance entities are also taking advantage of real-time credit assessments in new ways (eg, those offered by Enin and Mito.AI).

Wealth management (eg, Quantefolio, Kron, Norquant), securities trading (eg, Monetær, Huddlestock) and capital raising (eg, Spleis, Spare, MyShare.live, Around, Funderbeam, Investio) players are also well established in the Norwegian fintech space.

Answer ... New payment and account services are being developed on the basis of the Second Payment Services Directive. New providers of aggregator (platform) services are connecting and facilitating players in the market. New digital services are also being offered in the accounting sector (eg, Luca Labs, Fiken, Lucidtech), and in the digital banking and open banking sectors. Credit assessments are also being refined through artificial intelligence technology, with more holistic monitoring of debtors and integration with accounting systems. New community-based digital platforms are also being developed, combining the features of a social network with product and service offerings. Finally, cryptocurrency exchanges and wallet services are also being developed and offered by Norwegian fintech companies.

Answer ... Fintech players are often structured as private limited liability companies, whose founders are the majority shareholders.

Answer ... Initial investment in fintech players may be provided by family and friends of the founders and other high-net-worth individuals – often known as ‘business angels’ – in return for an equity stake. This seed investment is often used to fund the establishment and early growth of the business, before larger investment becomes available. Investors may also provide know-how and expertise to assist in the company’s development. Seed investors typically will not require the same controls over the business as, for example, venture capital providers. Various incubators and accelerators in the Norwegian market offer support, facilities and funding for start-ups, often in return for an equity stake. These include Finstar, Start-up Lab and TheFactory.

Crowdfunding has also been introduced in the Norwegian market and may be appropriate for early-stage fintech companies. Funding platforms include Around, Deal Flow, Myshare.live and Funderbeam.

Fintech companies can also apply for soft funding from Innovation Norway. Innovation Norway is the Norwegian government’s most important channel for promoting innovation and the development of Norwegian enterprises and industry. It supports companies in developing their competitive advantage and enhancing innovation. It also provides services for start-ups, such as mentoring and start-up grants.

Answer ... Recently, there has been increasing focus on the importance of innovation and job creation by fintech companies. Politicians hope to make the Norwegian economy less dependent on oil and natural resources. The fintech scene has grown rapidly in the last couple of years. Many accelerators and incubators have been established in the country’s big cities. Banks and corporates are also setting up their own innovation programmes and participating in accelerators to monitor developments. Banks are collaborating with selected start-ups to cooperate and develop their businesses. At the same time, however, there appears to be a lack of risk capital available for early-stage start-ups, which is slowing down innovation and growth.

Answer ... Our general impression is that fintech companies do not outsource their back-office functions, with the exception of cloud-based IT system platforms and accounting services. In our view, there is no developed Norwegian market for start-ups to access back-office functions. The country’s accelerators and incubators have partners which offer services to start-ups, often on favourable terms. The legal implications of outsourcing is that all outsourcing arrangements that involve the processing of personal data must comply with the EU General Data Protection Regulation (see question 5.1), as well as the Information Communication and Technology Regulation (see question 5.2).