At the end of 2017, seeking to strengthen the dialogue between payment service providers, users, regulators and the academia in the course of developing Lithuania’s payments market, the Bank of Lithuania and the Ministry of Finance established the Payments Council – an independent forum set up in light of market support, expressed during the public consultation on the National Payments Strategy.
The Payments Council was established drawing on the best practices of other countries. It consists of representatives of payment service providers, enterprises and residents, state institutions formulating and implementing payments policies as well as the academia, which share 10 votes, thus ensuring the principle of balanced representation. In 2020, the composition of the Payments Council changed and was complemented by new members. Currently, the Payments Council brings together representatives from the following institutions:
- Bank of Lithuania;
- Ministry of Finance of the Republic of Lithuania;
- Ministry of Economy and Innovation of the Republic of Lithuania;
- Association of Lithuanian Banks;
- Association of Payment and Electronic Money Institutions;
- Electronic Money Association;
- Fintech Lithuania group;
- FINTECH HUB LT Association;
- Alliance of Lithuanian Consumer Organisations;
- Council of Small and Medium-Sized Enterprises;
- Association of Lithuanian Chambers of Commerce, Industry and Crafts;
- Vytautas Magnus University;
- Mykolas Romeris University;
- Vilnius University;
- Kaunas University of Technology.
Members of the Payments Council can choose any relevant issues to be discussed during the meetings and prepare their work programmes. The Council aims to facilitate discussions on selected payment‑related issues among market participants and foster cooperation. It may form a common opinion and provide specific recommendations to market participants, state authorities and other institutions with regard to potential solutions, implementation of policy measures and development directions, formulate the common position of the Lithuanian payments market and present it to EU institutions.
Payments Council 2018
In 2018, the Payments Council analysed three priority issues and prepared the following recommendations for payment market participants, payment policymakers and policy implementing institutions:
- Integration of instant payments in business and public administration processes (feasibility study (1.1 MB download icon))
- Opportunities for optimising know your customer (KYC) process (feasibility study (1.5 MB download icon))
- Analysis of opportunities for new identification means and their compliance with anti-money laundering (feasibility study (1.5 MB download icon))
Recommendations are intended for making instant payments more popular, optimising KYC data collection process and creating conditions for innovative remote identification means to appear in Lithuania. The Payments Council determined market inefficiencies and suggested how to improve them:
- one stop shop principle, when the necessary data is requested from government registers and not from the client, is recommended for the KYC process;
- with the aim to expand instant payment service, the Council offers focusing on interoperability of services; to this end, it determined the areas in which equal principles should be applied;
- seeking to improve remote identification process, the Council offers changing the legislation so as to facilitate developing and offering on the market new and safe identification methods.
These changes will first of all benefit to the service users, i.e. natural persons and companies. Using financial services, especially remotely, would become easier, more payment service alternatives would emerge, and users would be required to provide less information to financial institutions. Furthermore, process optimisation would make financial institution service provision more efficient, making it easier to ensure the security of payment transactions and prevent money laundering and terrorism financing; this, in turn, would increase competition.
Payments Council 2019-2020
In 2019-2020, the Payments Council analysed the following issues:
- Creation of measures fostering an open ecosystem for non-cash payments in education institutions (feasibility study (312.8 KB download icon))
The Payments Council recommends to implement an infrastructure adapted to non-cash payments in canteens of education institutions, simplify the acquisition of non-cash payment instruments by minors, reduce prices of these payment instruments and develop practical financial literacy skills among students.
The objective is to achieve that it is possible to use non-cash payments in canteens of at least 80% of all education institutions, while the number of students having at least one non-cash payment instrument increases by 10% every year.
The Payments Council has identified three most relevant areas for the application of open banking (assessment of personal (corporate) creditworthiness, fraud risk management and the prevention of money laundering, enhancing personal finance analysis and management skills) and invites to further develop services in these areas.
Payments Council 2021
In 2021, the Payments Council is analysing the following topics:
- Access to the data in state registries.
- Ensuring accessibility of cash services in Lithuania.
The Payments Council’s rights and obligations, work organisation and publication procedures are set out in the Payments Council Regulations. Feel free to contact the Payments Council by email at [email protected].