How TWINO carved the way to become a regulated investment marketplace

TWINO Investments is a regulated global investment and trading marketplace and the leading peer-to-peer lending platform in continental Europe. TWINO serves nearly 50,000 retail investors from 30 countries, enabling them to invest in consumer loans through the company’s subsidiaries in Poland, Russia, Latvia, Vietnam, and elsewhere.

On August 31, 2021, TWINO received its license to provide investment services from the Financial and Capital Market Commission (FCMC). This was a big day for TWINO, and here I share the path that took us there.

Latvia – the perfect launchpad for kicking off a FinTech business

Thirteen years ago, when Armands Broks started TWINO, it consisted of a small team of enthusiasts with little experience, loads of ambition, and a few excel sheets to track the issued loans. Today, we are a global fintech player. We are thankful for having been able to realize all our earnest ideas in a supportive and tech-savvy environment.

A rapidly growing FinTech company such as TWINO can thrive only in an open startup ecosystem that welcomes and supports us when necessary. We’ve greatly benefitted from having access to local mentors and advanced tech knowledge, as well as events and incentives that support tech innovation.

What’s equally important – there’s quality tech talent available in Latvia and a moderate political and economic situation without instability and a severe conflict risk that could be dangerous to businesses.

Last but not least, we are lucky to have an understanding and forthcoming regulator for the FinTech industry. During almost 2 years of cooperation with the FCMC, we’ve found them to be a rather supportive advisory institution.

Choosing a regulatory jurisdiction

Before starting the licensing process, we analyzed several potential markets, including our Baltic neighbors. At a first glance, it seemed that other Baltic countries had simpler requirements; for example, Lithuania advertised the opportunity to receive a digital banking license quickly and easily.

But with time, we found that Latvia’s approach had subtly become much more flexible and open to innovation and cooperation.

We were glad to see that the FCMC is open to seeking creative solutions in unprecedented situations, which is crucial for new industries that are often trailblazers in their niche – like innovative FinTech.

We support the Latvian regulator’s approach focusing on a clear and transparent business model when issuing licenses and monitoring market participants. As opposed to regulators in many other countries where there’s no single framework for the peer-to-peer market segment or where companies in this niche are allowed to operate unregulated, the FCMC’s priority has been an effective, risk-based, and development-oriented monitoring of Latvia’s financial sector. We are also convinced that this path gives our users greater protection.

FCMC license opening doors to more diverse and transparent operations

On August 31, 2021, TWINO received a license for the provision of investment services and investment ancillary services. This was a big day for us as becoming a regulated investment platform opened many doors for growth and development and makes our business more credible in the eyes of our users and investors.

For more than a year, TWINO collaborated actively with the FCMC to secure this license, drafting the required procedures and making adjustments to how the platform operates. In this process, we received professional guidance and a forthcoming attitude.

The day we were finally granted our license for the provision of investment services and investment ancillary services was a day of great celebration and pride. The license will allow us to supplement our product offering with additional financial instrument trading such as stocks, bonds, CFDs, ETFs, and many more.

Moreover, licensing is a major step in promoting transparency in the entire industry. Investors will choose licensed companies over unregulated ones – in fact, we can already see a growing investor interest, thanks to more security and reimbursement guarantees that a regulated environment provides.