New technologies have touched all aspects of human life, and the finance sector is no exception.

In the last decade, financial technology is probably the most commonly used term in the entire financial sector and is

one of the fastest growing areas of technology. Investments in FinTech companies amounted to $2$ billion US dollars in

$2010,$ while investments in companies of this sector reached $130$ billion US dollars in $2020($Accenture $2015).$ Following

the global financial crisis of $2008,$ FinTech began to develop very rapidly, improving and changing trade, payments,

investments, insurance, settlements and their security, and even the money itself. U$.$S$.$ economist Nobel Laureate Milton

Friedman was the man who in the late $1980$s predicted that $$the Internet would limit the state$$s monetary system in the

future and lead to the emergence of digital money that would allow anonymous payments$.$ Friedman$$s prediction came

true, which led to the creation of the well$-$known virtual money$$cryptocurrencies$.$

FinTech is a very relevant topic not only globally, but also in Canada, where efforts are being made to create all

possibilities for the successful development of innovative financial technologies. As FinTech begins to play a key role in

our daily lives and economies it is very important to analyze this sector in order to understand the interactions between

traditional banking and FinTech.

In this case study the authors focused on Lithuania given there are many opinions the FinTech sector in this country can

become a European FinTech hub. U$.$S$.$ financial expert Noreika $(2017)$ has expressed the opinion that the idea for

Lithuania to become a European FinTech hub is quite real. The development of financial technologies in Lithuania has a

great support from the Bank of Lithuania, which is our central bank and supervisory institution for financial sector. At

the same time established FinTech Association helps foreign investors to come to Lithuania and provides all the

necessary information to finance the progress of these technologies. The development of the FinTech sector is one of

the government$$s priorities in Lithuania. These tactics have created fast$-$growing and accelerating FinTech companies

have begun to increase competition in the banking sector.

In parallel, some media has created the image of FinTech as destructive, revolutionary, and armed with digital weapons

that will overcome barriers and traditional financial institutions $($World Economic Forum $2017).$ According to PwC $(2016),$

$83\%$ of financial institutions consider that the various aspects of their business are becoming more risky as more

FinTech companies grow$.$ For FinTech companies, which already have a significant impact on the financial industry,

each financial company needs to create opportunities to use and invest in financial technologies in order to remain

competitive. Many economists have begun to consider whether financial technology will help companies to $$push$$

banks and other financial institutions out of the financial market, thus promoting a healthy competitive process that

increases efficiency in a market with barriers to entry or it will more likely create chaos, disruption and financial

instability? $$FinTech is developing very fast, but the impact of the banking sector on it is still unclear and it is suspected

that it may pose a threat to financial institutions$($Mal$$ciauskait $$e and Kvietkauskien$$e $2019),$ so this aspect of analysis,

research and forecasting is very relevant among scientists and economists since they are trying find out whether FinTech

companies can operate close to banks and cooperate, or can banks still have a negative effect on FinTech companies and

reduce their performance?

Deliverable:

In this case study we are asking you to focus on different aspects of FinTech in any country and see the interaction

aspects between banking sector and FinTech companies. The aim of the case study is to find out if there is an interaction

between any country$$s banking sector and the development of FinTech companies, i$.$e$.,$ how financial technology

companies are affected by banks, and whether banks can work together with FinTech companies. Is FinTech a positive

disruption as the country of Lithuania states, or is FinTech a destructive force as the media has stated.

It is implied, most countries support the idea that the banking sector must interact actively with FinTech sector in order

to improve their services and fulfil the clients$$ needs. By conducting research using literature and online data in addition

to your personal insights, you are to provide a report detailing two of the four FinTech hypotheses below as they apply

to any country in the world. Choose a country and provide your answers to two of the following hypotheses:

Hypothesis $($H$1).$ The growth of traditional bank performance negatively affects the performance of FinTech companies.

Hypothesis $($H$2).$ The banking sector and Fintech companies can easily interact in order to increase