Malta

Part
01
of twelve
Part
01

Business Statistics: Malta

In 2018, Malta had 113,256 registered business units, which represented an increase of 8.1%, or 8,458 registered units from 2017. 647 out of the 692 businesses in Malta listed in Hoovers' business directory have less than €50 million ($55.53 million) in annual turnover.

MALTA BUSINESS STATISTICS

  • In 2018, Malta had 113,256 registered business units, which represented an increase of 8.1%, or 8,458 registered units from 2017.
  • The total number of sole proprietorships in Malta was 53,395 in 2018.
  • 2018 welcomed the birth of 12,482 new businesses in Malta.
  • 110,149 businesses in Malta had less than ten employees.
  • The total number of businesses with 250 or more employees in Malta was 131 in 2018.
  • Based on Hoovers' business directory of companies and enterprises in Malta, only 45 businesses have annual revenues greater than €50 million ($55.53 million). The remaining 647 out of 692 businesses listed in the business directory have less than €50 million in annual turnover.

ADDITIONAL INFORMATION

  • There were 4,514 business deaths in Malta in 2018.

RESEARCH STRATEGY

For information on the proportion of all businesses have less than €50 million in annual turnover, we leveraged Hoovers' database. The database published a business directory of companies and enterprises in Malta, numbering 692, with their corresponding annual sales revenue estimates in USD. We then used a currency converter to determine the value of €50 million in USD to determine the number of businesses in Malta with less than €50 million in annual turnover.
Part
02
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Part
02

Co-working Space: Malta

While there is no publicly available information to fully answer the question, the available data was used to pull together key findings: SOHO Malta (three locations) and Regus (three locations) are the only major co-working space providers operating in Malta. The “culture of co-working” is a recent phenomenon in Malta and there are no Maltese cities listed on the 2019 European Co-working Hotspot Index.

CO-WORKING SPACE PROVIDERS IN MALTA


RESEARCH STRATEGY

To identify the number of major co-working space providers in Malta, we first examined the locations listed on co-working databases such as Coworker, CoworkBooking (Pembroke, Valletta, and Birgu), and Coworking.Coffee. As these databases include thousands of co-working spaces across hundreds of countries, it is assumed that they would provide a comprehensive list of active locations/providers in Malta. The website of every provider listed on these databases was examined to identify the number of co-working spaces that they operate. Among the seven providers examined, only SOHO Malta operates co-working spaces in at least three locations in Malta. Glashaus Startup Space, SC Cowork, Grand Central, 230 Works, The Penthouse, Marco Polo Malta Co-working (Marco Polo Hostel) operate one location only. Coco Hub is not a co-working space provider as the co-working space listed on its website is operated by Grand Central.
To ensure that every popular co-working space provider in Malta have been examined, we next conducted a press search for articles that talked about co-working in Malta and Europe. The articles published by MaltaProfile and Big Seven Travel talked about the best co-working spaces in Malta and Europe respectively. An examination of five additional providers has revealed that only Regus operates co-working spaces in at least three locations in Malta. The Hub Malta, BusinessLabs Malta, Your Urban Office, and Chiliz Blockchain Campus operate one location only. We have also discovered that Malta has a relatively small co-working market as it is a recent phenomenon for the country and Maltese cities are not known to be co-working hotspots.
Lastly, we examined some of the largest co-working companies in the world or Europe that were not listed in the databases and articles mentioned above. We have assumed that global players similar to or larger than Regus may also operate in Malta. However, we have discovered that companies such as WeWork, Spaces, Servcorp, Impact Hub, and Mindspace do not operate any location in Malta. Additionally, Europe-based co-working space providers such as Talent Garden, Silver Square, and UMA Workspace also do not operate any location in the country. Therefore, there are only 12 known co-working space providers in Malta, and only SOHO Malta and Regus operate at least three locations in the country.
Part
03
of twelve
Part
03

Registering a New Company: Malta

Setting up a company in Malta has several benefits, among which are a fast incorporation and a low corporate tax imposed. Foreign entrepreneurs looking to open a limited liability company in Malta can have complete ownership in their firms, complete confidentiality, and an easy registration procedure with the Maltese authorities, which is subject to approximately two working days.

OVERVIEW OF THE PROCESS OF STARTING A NEW COMPANY IN MALTA

  • When opening a business in Malta, foreign enterprises will consider the amount of money, also called a share capital they will have to invest in the company. From this point of view, the Commercial Code only requires private and public companies to deposit a specific amount of money.
  • There are no differences in the process of setting up a brick-and-mortar business vs. an online company. All companies would follow the same procedure.
  • Most companies in Malta are limited liability companies (LLC) or Maltese holding companies. Although there are other types of companies, these two structures attract many foreign investors since they have low maintenance costs and an efficient taxation system allowing tax exemptions for foreign businesses.
  • In the case of a Maltese private company, the minimum amount accepted is 1,165 euros, while for the public company the minimum share capital is approximately 46,600 euros of which only 25% must be deposited prior to registration.
  • Private limited companies with authorized share capital above the minimum threshold must deposit 20% of the amount of money.
  • Both types of companies must have at least two shareholders, even if the Company Law also allows a single shareholder to establish a company in Malta.
  • Each private limited liability company requires documentation about the fundamental conditions under how the company will be operating.
  • The required documents are from the Memorandum of Association and must be drafted according to Maltese law.

TIME AND COST REQUIRED TO OPEN A COMPANY IN MALTA

  • Depending on the type of company you’re setting up, the registration process can be quite efficient. It can be completed within a two-day window. A good first step is to register the company’s name online, with the Maltese Registry of Companies.
  • You must then submit the required documentation to the Registry of Companies.

REQUIRED DOCUMENTS

  • The Memorandum and Articles of Association (M&A), which state details about the company, such as whether it is private or public, what the business intends to do, who the subscribers are, and where the registered office is located. These documents must either be signed by subscribers or by their legal representation. That means that you do not have to be physically present to register your company in Malta.
  • Proof that initial share capital has been deposited (in the case of an LLC).
  • Proof of identification for the subscribers.
  • After the documents are submitted to the Registry of Companies, your registration will be completed within 24 hours. In some cases, registration fees are required; the fee will depend on the amount of authorized share capital.
  • For up to 1,500 euros of share capital, the registration fee is 245 euros.
  • The registration fee ranges from between 245 and 2,250 euros, depending on the amount of share capital. You can partially complete the company registration online, but either you or your legal representatives must be physically present to sign off on certain documents.
  • Applying for a VAT or employer number can be done online.

OPENING A BANK ACCOUNT IN MALTA

  • A company bank account is needed to complete the company incorporation.
  • Once the share capital is deposited, the bank will provide a certification which is required by the Malta Financial Authority before issuing the registration certificate.
  • Once you have your Certificate of Incorporation that confirms details like the name of your company you can open a bank account. 
  • Such banks offer different services including checking books, debit/credit cards, internet, telephone and phone banking, bank accounts in a wide choice of currencies and other traditional banking services.

EXCHANGE CONTROL

CONFIDENTIALITY

  • All company documents are public. However, confidentiality can be maintained through the services of a fiduciary in which the name of the shareholders will not be disclosed in the public registry.
  • Details of the ultimate beneficial owner must be submitted to the Maltese Registry of Companies.

TAXATION OF MALTESE COMPANIES

Part
04
of twelve
Part
04

FinTech Climate: Malta

The climate for FinTech businesses in Malta in welcoming, as the government continues to make it conducive for FinTech companies to strive through its policies and setting up incubation centers. FinTech companies such as eCommerce has already been setup in Malta.

MALTA'S FRIENDLINESS TO FINTECH COMPANIES

  •  The government is looking for ways it will get a new niche in the finance sector.
  • They see fintech as a driver for growth in the industry.
  • In its 2018 budget the government announced that it intends to set up a new blockchain lab at the Malta Information Technology Agency.
  • They also launched a web portal that focuses on distributed ledger technology and cryptocurrencies.
  • The government will also be launching a blockchain hub, to support startups in working with the technology.
  •  The government said they will be setting up a blockchain taskforce.
  • Financial software entrepreneurs are given the opportunity to set up in one of Europe’s fastest-growing financial centers.

MALTA'S POSITION AS LEADER IN FINTECH

  • Fintech start-ups coming to set up in Malta will be given access to a technology business incubator based at the University of Malta.
  • There is also an innovation hub run by the Malta Information Technology Agency for Fintech start-ups.
  • A state-of-the-art technology park is already in building.
  • These initiatives will further enhance the supportive environment and infrastructure for fintech companies.
  • Over the past few years Malta had already become an attractive jurisdiction for fintech start-ups.
  • The promulgation of the EU First Payment Services Directive, has resulted in Malta experiencing an influx of fintech start-ups.
  •  Fintech companies are also using Malta as a springboard to nearby markets, in particular those of Africa.
  •  eCommerce is one of the first companies to take advantage of what Malta has to offer, such as fiscal benefits, a strategic location in the center of the Mediterranean and cultural proximity to Europe.
  •  Malta’s finance sector has recently seen new operators entering the market.
  • Changing market dynamics driven by technology-savvy consumers have created a fertile environment for fintech.
  • There are already fintech companies based. They have been drawn to Malta because it provides a wealth of talent, both tech and finance.
Part
05
of twelve
Part
05

FinTech Companies: Malta

Singular is an international game development company with four offices and two development bases around the world. Singular has raised a total of $5.7 million in funding, in one Series A round, on December 18, 2018.

SINGULAR

  • Singular has raised a total of $5.7 million in one Series A funding round, on December 18, 2018.
  •  Singular is an international game development company with four offices and two development bases around the world.
  • More than 100 developers continuously strive to make the world’s most "innovative" and "outstanding" gaming solutions.
  • The company website may be viewed here.

BINANCE

  •  Binance is a cryptocurrency exchange platform that combines digital technology and finance.
  • The company provides access to exchange digital currency pairs on the market, while enabling a safe and efficient deal with anyone, anytime and anywhere.
  • Binance has raised a total of $10 million in funding over 3 rounds. Their latest funding was raised on Oct 23, 2018 from a Venture- Series Unknown round.
  • Their website can be viewed here.

OTHER COMPANIES

THRIVE LABS
  •  Thrive is a blockchain-based trading platform to buy and sell advertising at very low fees.
  • People get paid for data sharing and for reviewing the quality of each website in the ecosystem.
  • Thrive Labs has raised a total of $25 million in funding over 1 round. This was an Initial Coin Offering round on September 1, 2017.
  • Their website can be viewed here.

YOVO
  •  Yovo was founded in 2017 and is working on building the world’s first Tokenised Mobile Network.
  • Yovo, which operates SIM and virtual SIM-based networks, is using the Stellar blockchain to create the world’s first global tokenised mobile phone network.
  • The Malta-based company has raised €20 million in venture funding.
  • Their global headquarters has thirty employees.
  • Their Facebook page can be viewed here.

BUNDLE
  •  Bundle Network is an online platform connected to various exchanges.
  • They are enabling users to trade multiple coins & tokens within seconds of execution.
  • This is through one account and one click, at the best price possible, either in bundles or individually.
  • The firm was started in 2017.
  • In August 2018, the company raised a total of $100,000 in funding from Coinsilium Group through a seed round.
  • Their website can be viewed here.

RESEARCH STRATEGY

The information on FinTech companies in Malta and received series A, B, C or D funding in 2018 or 2019, is not available. The reason likely being that the fintech industry is still in its infancy and hence most of the investment is sourced from founders and "friends and family" investors, that eventually leading to Series A investment. It is rarer that fintech firms established in Malta are already at the Series B or C investment stage as per Mondaq.
In order to find the remaining 8 companies with all the required information, we attempted multiple strategies. We first looked into company financial data portals like Crunchbase, Angel List, Zoominfo, and Dealroom. These portals have the option to search for the company type along with the location and are known to keep verified financial information of industries across the world. Using this we were able to find four fintech companies in Malta which were indeed fintech and had funding raised.
We then moved on to find trending news articles from the fintech industry in Malta where we were hoping to find a list of a few successful fintech startups. We scanned through multiple national and international fintech industry news like Times of Malta, Maltaprofile, Fintech News, Lexology, Mondaq, and IBS Intelligence. The other news articles found covered how Malta is transforming into a bitcurrency friendly island.
In an attempt to find more companies with all the data we checked the investors that have funded the identified companies. The idea here was to check these investor companies individually to find out if they have funded any other fintech companies in Malta. However, none of these investors had any information on their other funding ventures.
Part
06
of twelve
Part
06

Digital Services Trends: Malta

Blockchain applications, electronic money institutions, conversational banking, Revolut, and digital banking platforms are some recent trends in digital services being offered in the financial services sector in Malta.

DIGITAL SERVICES TRENDS: MALTA

TREND #1: BLOCKCHAIN APPLICATIONS

DESCRIPTION:

WHY IT IS TRENDING:

COMPANY AT THE FOREFRONT:

TREND #2: ELECTRONIC MONEY INSTITUTIONS (EMI)

DESCRIPTION:

WHY IT IS TRENDING:
  • There are 28 credit institutions and 35 financial institutions, including 22 payment institutions, and 7 electronic money institutions licensed by the Malta authority under the Financial Institutions Act.
  • Malta continues to be positively ranked for its performance in the financial sector. The development of Malta as an international financial center is reflected in the range of financial services available.

COMPANY AT THE FOREFRONT:
  •  CSB Group provides clients with professional assistance for the Licensing of Electronic Money Institutions (EMI), throughout the application procedure, company establishment, and post-licensing support.
  •  Integritas Group provides assistance with the Licensing of Electronic Money Institutions (EMI) in Malta.

TREND #3: CHATBOTS AND CONVERSATIONAL BANKING

DESCRIPTION:
  • Start-ups are creating a stir in the financial service's industry in Malta by integrating chatbots. They enable companies to deliver immediate and insightful information to their customers.
  • Some national banks like Central Bank of Malta are planning to integrate chatbots that can add value services for their customers, i.e., to personal and corporate accounts.

WHY IT IS TRENDING:
  • According to eMarketer, nearly 90% of bank-related interactions will be automated by 2022.
  • Alternatively, the banks are likely to save an estimated $0.60 on average per chatbot interaction and can resolve a number of customer queries.
  • Chatbots can handle a high volume of requests with an accuracy of nearly 97%.

COMPANY AT THE FOREFRONT:
  •  Central Bank of Malta is using a chatbot help desk to provide information about the customers' lei code, ID verification, and searching for the entity code, among others.
  • The service helps the Central Bank of Malta to automate the simple questions and take action in less time and fewer resources.

TREND #4: REVOLUT

DESCRIPTION:
  • Revolut is a digital banking alternative that offers services like currency exchange, cryptocurrency exchange, peer-to-peer payments, and debit/credit cards (MasterCard or VISA).
  • Revolut has secured a European banking license with Lithuania’s central bank.
  • Revolut does not charge fees for most of its services but includes a usage cap for its services. It also uses inter-bank exchange rates for its currency exchange on weekdays and a markup ranging from 0.5% to 1.5% on weekends.
  • Revolut has an open API, which helps companies to integrate their software to its business platform.
  • The Revolut App provides instant access to Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and XRP by exchanging to/from 25 fiat currencies.

WHY IT IS TRENDING:
  • Revolut serves more than 80,000 clients in Malta and expects to add about 60,000 customers by the end of 2018. Additionally, Revolut Business serves nearly 70,000 corporate accounts in Europe.
  • The Revolut customers increased by nearly 40% each month as a number of customers try to rely on the system.

COMPANY AT THE FOREFRONT:
  • Buddy is a payroll software available internationally; it has integrated with Revolut to optimize the payroll transactions by making them faster and easier to operate.
  • The benefits of using Revolut, together with Buddy, reduces processing and transaction costs and allows for commission-free multi-currency payments.

TREND #5: DIGITAL BANKING PLATFORMS

DESCRIPTION:
  • Financial institutions, instead of providing competitive bank-owned options for services like payments and money movement (e.g., bill pay, P2P, A2A), allow the use of third-parties for optimizing transactions.
  • In 2019, savvy banks and credit unions adapted to the scenario and went for modernizing their digital banking platforms in Malta.
  • As per Vipond, more banks and credit unions are working to offer an optimal digital experience and incorporate personalization in their digital banking platforms.
  • Digital banking assistants for prominent banks support and advise its users, signifying an evolution of customer-bank relationships.

WHY IT IS TRENDING:
  • Increased number of consumers are performing cross-border transactions; additionally, the digital banking platforms streamline the process of fund transfer.
  • Digital banking platform offers the customers with access to a range of services like fund control, managing cards, loans, among others.
  • According to a recent survey by Bank News, about 42% of customers preferred using banking services from a community or regional banking institution over a national one, because they offer a better banking experience.

COMPANY AT THE FOREFRONT:
  • FIMBank launched a secure digital banking platform, FIMBank Direct to target the needs of both personal and corporate customers.
  • FIMBank Direct provides high-level security protection through its authentication app, FIMBank CAM.
  •  Medirect Bank also plans a significant digital transformation to become compliant with the Payment Services Directive 2 (PSD2) in Malta over coming 18 months.
  • According to the Head of Business Development, at Medirect Bank, the bank is undertaking one of the biggest projects to transform its online banking and wealth management platform in Malta.

RESEARCH STRATEGY

To identify the trends in terms of digital services being offered in the financial services sector to businesses in Malta, we scoured through credible industry reports, and blogs from publications like Deloitte, PwC, KPMG, CoinSpeaker, GVZH Advocates, Business Insider, among others.
We have identified the trends based on the industry report/industry blogs that highlight the current and different types of digital products/services offered to businesses, not other/external trends that are impacting the industry. Some services are common to businesses and consumers, but we have focused on the business aspects of the service only.
We have also used a source that is older than 24 months, i.e., Chetcuti Cauchi Advocates Report because it provides a description and adaptation of the current trend, and shows the industry trend is still relevant when corroborated with KPMG report.
The trends have been identified based on for Malta, based on the news articles/industry and adaptation by the Malta-based companies and/or international companies located in Malta. We have taken the above-identified trends as currently "trending" based on its repetition as a trend across 2 or more reports. The trends have also been based on the services being offered in the industry to show the following trend adaptation by the companies. Next, we focused on the companies which have been following the trend or have plans to implement it as the "forefront" companies of the respective trend.
Part
07
of twelve
Part
07

Google Pay Statistics: Malta

After an extensive search through global and regional data, statistical databases, and analytical apps, details about Google Pay's presence in Malta do not appear to be available in the public domain. However, the research team was able to gather valuable insights about Google Pay and its relationship with Revolut in Malta.

USEFUL FINDINGS

GOOGLE PAY AND REVOLUT
  • Google Pay was in 28 countries as of 2018 excluding Malta. The name "Google Pay" came after Google and Android merged. By implication, Google Pay was not in Malta. This provides insight into why finding Google Pay statistics specific to Malta is difficult, given that Malta was not on the list of countries that Google Pay had any presence in as of 2018.
  • According to Albert Herd, "Apple Pay is now supported in Malta, through Revolut. But little did Android users know that Google Pay has been supported by Revolut for more than a year now!"
  • Google Pay had a total of $102 billion in transaction volume in the European region, including Malta, since Malta is in the European Region.
  • Online bank payments are available in Malta through various methods, including Google Pay.
  • Revolut began Google Pay operations in July 2018 in Malta and was projected to have 60,000 users by the end of 2018. This provides an estimate of how many Google Pay users there could be, but there is no update available for this projection.

ADDITIONAL FINDINGS
  • The Global Mobile Wallets 2019 report included a prediction that the number of e-wallet users worldwide is expected to reach a ten-digit figure in 2019.
  • The number of non-cash transaction per inhabitant in Malta saw a CAGR of 10.4% from 2012 to 2015. The CAGR in 2015-2016 for mobile payments overall in Malta was 3.3%.
  • "According to reports from April 2018, Google Pay has reached 100 million installs in just a few months, and throughout 2018 and 2019 it expanded its global presence as well, rolling out in many countries, including Japan, Croatia, the Nordics, UAE, Chile, France, Switzerland, Israel, and Germany," as reported by the 2019 report.

RESEARCH STRATEGY

We began by our research going through global organizations that provide analytical data for various countries of the world in a bid to find the statistics showing how Google Pay is used in Malta, specifically concerning the number of users, payments, and merchants accepting Google Pay. We came across a World Payments Report but the report only had CAGR for Malta for payments but did not provide details about how Google Pay is used in Malta. Economic Times discussed the number of Google Pay users in India (25 million) which was not the data we were looking for.
We then looked for statistical data on the European Payment Council in Europe, as Malta is part of the council. We found predictions that Google Pay is expected to reach 100 million users between 2018 and 2019, but this data did not help us solve the questions about how Google Pay is used in Malta.
Next, we consulted online statistical databases that report on both the regional and international level. Through this search, we found information on payment methods in Europe, but these findings did not provide anything specific to Malta or Google Pay's presence in Malta.
We also used analytical apps to find information specific to Malta and Google Pay's presence in Malta. However, we were only able to find information specific to the UK. Without a direct answer or the data necessary to triangulate one, we are unable to determine the number of Google Pay users, the number of payments by volume or overall, or the number of merchants using the service in Malta.
Based on our findings, we know that data specific to Google Pay's presence in Malta is limited. Most data that did refer to Malta did not discuss Google Pay. We did find that there is a link between Revolut and Google Pay's presence in Malta. Google Pay in Malta makes use of Revolut as a platform for services.
Part
08
of twelve
Part
08

Apple Pay Statistics: Malta

No information could be found on the public domain indicating how widely used Apple Pay is in Malta. Below is an overview of the information that was available.

USEFUL FINDINGS

APPLE PAY IN MALTA

  • Apple Pay was officially launched in Malta and 12 other countries on June 16, 2019. Apple Pay is relatively new to Malta, therefore, statistics about Apple Pay are currently difficult to come across.
  • Apple Pay has expanded to multiple European countries such as Bulgaria, Croatia, Cyprus, Estonia, Greece, Latvia, Liechtenstein, Lithuania, Malta, Portugal, Romania, Slovakia, and Slovenia in 2019. In May 2019 Apple Pay had not yet launched in Croatia, Portugal, Greece, Malta, and other EU countries.
  • Apple’s mobile payment system is, however, now available to millions of users across Europe including Malta.
  • According to Malta Today, a publication in Malta, Revolut launched Apple Pay in Malta in June 2019.
  • Revolut customers in Malta can add their card to Apple Pay with the Revolut app or the Wallet app and pay for online purchases.
  • Revolut, an online banking platform, is available on the App Store in Malta. Its users can add their card details to Apple Pay and utilize their Apple devices to pay for purchases in local shops in Malta.
  • Furthermore, Apple Pay has support for Malta on its support page.

RESEARCH STRATEGY

We began our research by carrying out a broad search on global financial publications (such as the Financial Times and Economic Times) that report on business and the performance of various companies in a bid to find statistics showing how widely Apple Pay is used in Malta, the number of Apple Pay users in Malta, the number of Apple Pay payments by volume in Malta, and the number of merchants accepting Apple Pay in Malta. The Financial Times published articles on what Apple credit cards got right or wrong in its market, but did not publish any information relevant to the request. The Economic Times provided data on Apple's global finances but, again, nothing relevant to the request.
Next, we consulted regional and local publications to see if we could find relevant data within the region. The local news publications in Malta only published articles centered around the anticipation of Apple Pay in Malta and when it would become operational. Again no relevant data was published. Media publications such as the New York Times were also consulted, but here we found articles such as "Apple Says Profits Were Flat, Citing Slump in China" which were not helpful.
We also searched for the statistics on Statista, a statistical database that has data on millions of topics. Statista had data on the number of Apple Pay users worldwide in 2018, however, none of its statistics were on Malta specifically.
We evaluated the information collected through our research and could not find data that was sufficiently reliable and could be used to triangulate the requested information. After applying the above strategies, we concluded that the requested information was not available on the public domain.
Part
09
of twelve
Part
09

Digital Banking: Malta

Over 51% of Maltese access their banks over the internet; over 10% of Maltese access digital banking services through mobile applications. More than 35,000 Maltese have signed up to the digital banking platform by Revolut. These, among others, are indicators of the widespread use of digital banking services in Malta. A detailed account of our findings is below.

USE OF DIGITAL BANKING SERVICES IN MALTA

  • Digital banking in Malta is made possible under the Electronic Money Institution license, which is issued by the Government.
  • Maltese are gaining confidence in digital banking platforms, and they are relying on it more.
  • As of 2018, about 51% of Maltese used one digital banking platform or another.
  • The average age of a Maltese digital banking services user is 32 years.
  • More than 35,000 Maltese signed up to the digital banking platform Revolut, within a month of its launch.
  • Malta is the largest market for Revolut; 10% of Maltese already use the digital banking platform.
  • FIMBank launched FIMBank Direct, a digital banking platform targeting both personal and corporate customers.
  • There is an increase in adoption of Digital Banking by Maltese and the number is expected to grow.

HOW MALTESE ACCESS DIGITAL BANKING SERVICES

  • More than 51% of Maltese access their banks over the internet.
  • More than 10% of Maltese access digital banking services through mobile apps.
  • Customers access the Revolut platform through its mobile application.
  • Maltese also access digital banking services through work platforms such as Slack, Xero and Zapier.
  • In Malta, digital banking platforms such as MoneyPlusCard and PayMix offer their services only through the web.
  • LeuPay, a digital banking platform, is offered through its mobile application.
  • The FIMBank Direct platform provides an integrated solution through which customers can manage their finances and banking requirements.
Part
10
of twelve
Part
10

Digital Banking By Industry: Malta

While there is no publicly available information to identify the 3-5 industries in Malta that have most embraced digital business services, available data was garnered that is concentrated on the services and product profiles of the various banks along with broad trends (e.g., Blockchain) impacting the overall exposure to various industries in Malta. Below is an outline of our research strategies to better understand why the information requested is publicly unavailable, as well as a deep dive into the findings.

BROAD TRENDS

  • The digital banking penetration in Malta has progressed at a slow pace over the past 5 years growing from 43% in 2013 to 51% in 2018. However, over the last 10-year period, digital banking penetration in Malta has more than doubled from 25% in 2008 to around 51% in 2018.
  • Among the 26 banks for business operating in Malta, some leading banks providing both traditional and digital services to business customers include Bank of Valletta, HSBC Bank Malta, FIMBank, Sparkasse Bank, IIG Bank, Akbank TAS, Credoarax, Agri Bank, Banif Bank, and FCM Bank.
  • The various financial products offered through digital business banking by banks in Malta include credit cards, retirement products, life insurance packages, wealth management, fixed-term deposits, savings accounts, and other services for small- to medium-sized organizations.
  • FIMBank, which is one of the top banks in Malta, launched 'FIMBank Direct', a secure digital banking platform targeting the needs of both personal and corporate customers.
  • The same provides a comprehensive service suite which includes savings accounts, fixed-term deposits, and local and crosses border payments with a selection of available currencies.
  •  Revolut is one of the latest digital-only banking platforms to be launched in Malta and has achieved the biggest market penetration level yet in the country, with nearly 10% of the entire population signing up within a short period.
  • The various suite of services offered by the platform include a prepaid corporate debit card (MasterCard or VISA), currency exchange, cryptocurrency exchange, and peer-to-peer payments.
  • As per the 2018 Annual Report of MeDirect Bank, which is the third-largest bank in Malta, 'Financial & Insurance sector'; 'Manufacturing' industry and 'Information & Communication' industry was the top ones with the highest uptake of banking business credit services as corroborated by the bank's credit exposure to these sectors.
  •  Blockchain technology is one of the major trends in the Malta digital banking space and as per an announcement in late 2018, Malta is about to get a bank in form of RnF Finance Limited that will finally begin servicing crypto and blockchain companies as well as high net worth individuals who, until recently, have been shunned by traditional banks.

RESEARCH STRATEGY:

After an exhaustive search, your research team was not able to find any direct information apropos of the top industries that have had the highest uptake of digital business banking services in Malta. All the information found catered around the top digital and traditional banks in Malta, an uptick in the retail scenario for digital banking, trends in the digital banking space and the top sectors to which banks in Malta have the highest credit exposure. The primary reason for the information to be missing might be the lack of disclosure by banks around their top clients or sectors due to competitive and confidential reasons. We have provided an outline of the strategies used for your perusal and to help shed light on how/why we determined details are not available.
Our first strategy was to scour through the industry reports on the digital banking sector in Malta from Deloitte, McKinsey, KPMG, Market Radar, Bloomberg, Reuters, etc. These industry reports are a key source of information for the industry profile; however, the information found centered around overviews of the banking sector in Malta along with the top banks operating in the space and the key regulations that have impacted the space.
The second strategy was to scour through the credible databases and websites of the key regulatory and other authorities for the banking industry in Malta such as Central Bank of Malta (the Bank).org, Maltaprofile.info, EBF.EU, Malta Financial Services Authority (MFSA) database, Malta Bankers' Association (MBA), IMF, etc. All these regulatory and banking databases are a potential source of information around the exposure limits and the key industries/sectors to which the banking industry is exposed in terms of its business to assess the risk exposure of the industry. However, the data broadly focused on industry statistics and governing regulations along with the recent blockchain and other fintech trends that are impacting the banking space in Malta. IMF did mention that the "core domestic banks high exposure to property-related loans, together with the rapid house price appreciation", posed a risk to the banking sector in Malta but did not elaborate on the digital banking services exposure of various sectors in Malta.
Our third strategy was to try to triangulate the information by scouring through the websites and annual reports of the top business banks in Malta such as FCM Bank, MeDirect Bank, digital-only banks such as Revolut, Bank of Valletta, HSBC Bank Malta, etc. The idea was to go through the filings, press releases, and websites of these banks and try to garner information around the key industries served by these banks through their digital services. Since the banking sector in Malta consists of just 26 banks, garnering the information on the top banks could have allowed the team to triangulate the information by stating that since "X, Y, Z are the top industries utilizing the digital services of the top banks by market share in Malta they are very likely to be the top industries that have had the highest uptake of digital business banking services in Malta overall." However, none of the banks were found to disclose any such information in their filings. All the information found catered to the credit exposure of different banks to the various industries/sectors in Malta.
The research team tried additional strategies that include scouring through local and credible media articles (e.g., Time of Malta, Malta Today, Forbes, Bloomberg, Reuters, etc), statistical websites, and Malta banking blogs (e.g., HSBC Malta, Maltaprofile, KSI Malta, etc) but no pertinent information could be located and all the data found was around the rate of digital penetration in Malta, top banks for business banking in Malta and trends in the sector.
Part
11
of twelve
Part
11

Challenger Digital Banks: Malta

Meta Luminor and UK-based Revolut are the top challenger digital banks in Malta with a market presence of over 85,000 customers and over 35,000 customers, respectively. Other top competitors in Malta's digital banking market include Paymix and MoneyplusCard, digital business solutions for private and corporate customers.

META LUMINOR


REVOLUT


PAYMIX


MONEY PLUS CARD

RESEARCH STRATEGY

To find the top challenger digital banks in Malta, we searched articles, financial news media, and banking industry statistics and trends concerning Malta. According to fintech and digital banking publications, there are numerous digital banking companies operating in Malta (approximately 40). So, we first attempted to list those companies from financial articles, publications, and journals, providing four companies. Unfortunately, those articles did not classify the top players, nor did they give their market penetrations. Then, we tried to find additional data on these companies through their websites and Maltese fintech or digital banking reports to determine their dominance in the Maltese market. Luckily, we found only two sources that indicated the actual market penetration by Meta Luminor and Revolut but we could not locate the market penetration of other digital banking companies. Moreover, we could not find individual companies' financial reports or market reports. We changed tactics and decided to determine the top challengers by the size of the company or the latest available revenue estimates. For this, we leveraged corporate financial databases. By comparing the competitors, we were able to identify other digital banking companies operating in Malta, such as Izola Bank, Banif Bank, FIM Bank, and Fidor Solutions. However, we still could not find any information regarding market share/penetration.
Part
12
of twelve
Part
12

English Usage: Malta

The population of Denmark that speaks English is 3,059,351 (52.95%), and 270,391 people (62.39%) in Malta speak English.

ENGLISH AS A FIRST OR SECOND LANGUAGE IN MALTA AND DENMARK

  • Maltese is the first and primary language in Malta with 97.25% of the population speaking it while English has a 62.39% usage in the country.
  • Danish is the first and primary language in Denmark with 98.39% of people speaking it while English has a 52.95% usage in the country.
  • Denmark has a population of 5,777,812 people as of Friday, August 16, 2019, according to the latest United Nations estimates.
  • According to the most recent United Nations estimates, Malta has a population of 433,389 people as of Friday, August 16, 2019.

USE OF ENGLISH FOR BUSINESS IN MALTA AND DENMARK

  • Malta is a bilingual country, and the constitution recognizes both Maltese and English as official languages.
  • For citizens of Malta, both Maltese and English can be considered to be native languages, and since English is recognized worldwide as one of the main business languages, this gives Malta a leading edge over several other countries.
  • Also, "all road signs are in English, driving is on the left, and international and national driving licenses are acceptable," which indicates that business transactions are done in English, as proven by the car rental sector in Malta.
  • Danish people are considered the best in the world in speaking English as a second language. They are the world's best non-native English speakers.
  • "There are strong correlations between English proficiency and income, quality of life, ease of doing business," and the Danish people are good at speaking English. Hence, English is used widely in Denmark for business.

USE OF ENGLISH IN MALTA AND DENMARK IN ADVERTISING OR MEDIA

  • The use of foreign Languages in advertising in Denmark is allowed, and English is often used in ads to reach the Danish consumer.
  • The use of English is official in Malta; hence, by implication, the adverts in the English language will be high as well.

CALCULATION

  • Population of Denmark that speaks English = 5,777,812 * 52.95% = 3,059,351
  • Population of Malta that speaks English = 433,389 * 62.39% = 270,391
Sources
Sources

From Part 02
From Part 06
From Part 11
Quotes
  • "Throughout the past decade due to delayed payment patterns of what was then the norm for businesses in Malta, Meta Luminor’s Managing Director Philip Maurice Mifsud, also kept a full-time job as the reliance on clients settling within 30 days back then in Malta was just not possible, so to sustain his family he was forced to be both self-employed as well as employed."
  • "In early 2018 Philip Maurice Mifsud during his employment with a now known technology stack provider, he decided to also take on as a hobby the support for the growth of a known London based Multi-Currency E-Wallet Fintech firm. The growth strategy in Malta worked so well that he basically grew their market exponentially from 17,000 users to 85,000+ users in under a year (Malta’s population is 432,858 meaning a 20% population market penetration) with ZERO marketing spend and even Won Innovator of the Year at the Malta Blockchain Summit."
Quotes
  • "Headquarters Mellieha, Malta"
Quotes
  • "Banks will charge you when you spend or transfer money abroad. We're not about hidden fees or rubbish exchange rates, and that's why 6M+ people already use Revolut"
Quotes
  • "More than 35,000 Maltese have signed up to the digital banking platform Revolut, less than a month since the company launched its services in Malta, MaltaToday has learned."
  • "This makes Malta the country with our biggest market penetration level yet, with nearly 10% of the entire population signing up in a matter of weeks,” country manager Dimitris Litsikakis told MaltaToday."
  • "Revolut is a digital banking alternative that includes a pre-paid debit card (MasterCard or VISA), currency exchange, cryptocurrency exchange and peer-to-peer payments."
Quotes
  • "PayMix offers Solutions for both Corporate and Personal Customers (Through its new brand "PROSPERO")"
  • "Paymix is a principal member of MasterCard Europe and is authorised by the Malta Financial Services Authority, under the Financial Institution Act 1994, for the issuing of electronic money and the provision of payment services."
Quotes
  • "The PayMix Pro Account has been designed as an alternative cost-effective payment solution to your traditional business banking account."
  • "With PaymixPro account; you will have online access to your account, dedicated IBANs under your name, corporate Debit Cards (Mastercard), instant SEPA transfers, payment options in 60+ currencies and multiple user access."
Quotes
  • "Electronic Money Institutions (E-Money Institution, EMI) are a new era in banking with a focus on remote services, mobile apps, and streamlines, simple services. The most noteworthy examples are probably Paysera, LeuPay, and N26."
Quotes
  • "Send money, make purchases and get paid with your mobile phone Cashless, fast and convenient, Epayzz is the new generation of mobile payment solutions. It is a smartphone application that enables clients to pay for products and services and send funds to others, without a payment card or payment account."
Quotes
  • "Money Plus Card, written as Money+Card, represents a new era of branchless financial services available through the internet. We were founded in 2015 and licensed in 2016 and are a Payment Institution that offers simple, fast, and seamless financial transfers and card services without big bank bureaucracy, legacy technology, high fees, and frustrating jargon."
  • "We are based in the dynamic country of Malta, in the capital city of Valletta. We are regulated by the Malta Financial Services Authority and are a Mastercard Principal Member which means we can issue our own payment cards for our clients. Card issuance defines our brand and what we stand for: “Money+Card” means simply that we give you a card and very much more."
  • "We are not a bank. Money+Card breaks from tradition by providing payment accounts that can be used like a bank account, and all with a worldwide card, and simple electronic payments worldwide."
  • "Our payment services are provided online using advanced digital platforms and can support mobile phone, tablet, and computer applications. Our clients can access our online environment 24-7, beyond the frustrating business hours of operation of banks, and are available when our clients need them."