News - 21.07.2022

Talent and sustainable finance, the challenges of LHoFT 2.0

  • FinTech

The Luxembourg House of Financial Technology (LHoFT) has played an instrumental role in supporting the growth of FinTech in Luxembourg. Following its five-year anniversary, Nasir Zubairi, its CEO, wants to strengthen the initial strategy by emphasising the talent and education component and ensure the development of sustainable finance through technology.

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Just five years after its creation, the LHoFT is filled to capacity. Since mid-2020, it has housed 86 young fintech companies, which represents its maximum capacity. A total of 146 companies have already passed through its doors, some of which have become clear success stories, including Tokeny, VNX, Nextgate Tech, Bitflyer and Satispay.

Established to support the digital transformation of Luxembourg’s financial sector at a sustained pace, the Foundation, conceived as a public-private partnership, has significantly contributed to the creation of an ecosystem of approximately 250 Fintechs employing over 5,000 people. Success that its CEO, Nasir Zubairi, is not too keen on dwelling on, as he is already focused on the LHoFT 2.0 for the next five years. “We have been able to contribute to the creation of a robust fintech ecosystem that bridges the gap between solution providers and major international financial players. We now need to focus on the new challenges to ensure the future competitiveness of the financial sector.”

However, rather than the revolution that represented the creation of the LHoFT is 2017, this will be an evolution. “We want to continue to do what we already do, but better,” says the Zubairi. The main objective remains to help financial players reduce their costs, which he believes will inevitably involve the provision of new technological tools. The dominant Fintech sector in Luxembourg is Regtech, which provides solutions for automating activities related to regulation, compliance, reporting and data management.

Beyond this general objective, the LHoFT wants to grow its impact on technological education and talent, contribute to the development of sustainable finance and provide global answers to challenges shared by all players in the financial sector.

The LHoFT has seen the potential of its online educational seminars during the pandemic – 300 digital workshops attracted over 11,000 people – and will capitalise on this channel to increase the technological literacy of financial employees. “We will particularly target middle management, which is probably the most resistant to change. We want to make it clear that technological change is inevitable, that it adds value and that it does not threaten jobs,” highlights Zubairi.

The LHoFT will also strengthen its relations with various international universities. It will schedule student visits to Luxembourg to try to attract new talent to the financial sector by presenting the technological attractions. “Young graduates now prefer a career in big tech to one in banking,” observes Zubairi. “We want to show them how exciting the financial industry in Luxembourg is thanks to the mix between finance and technology.”

In the sustainable finance sector, Luxembourg intends to play a central role. After having launched the Catapult project, which aims to increase financial inclusion in Africa, the LHoFT is now tackling the problem of diversity, with a particular focus on the difficulty of recruiting female staff in both the finance and technology sectors. In FinTech the problem is therefore cumulative.

On a broader scale, Zubairi wants to contribute to the development of this growing sector by enabling it to avoid certain pitfalls through innovation. “We are currently conducting a very broad study on how technology could help add value to the sustainable finance sector. We will publish it later this year.”