EASTERN EUROPE

In Eastern Europe’s mostly bank-led environment, the DFS landscape remains nascent. Recently, neobanks (internet-only banks) have been increasingly focused on reaching the underserved and unbanked populations.

23%

In the Commonwealth of Independent States (Bulgaria, Estonia, Kazakhstan, Latvia, Lithuania, Romania, Russia and Ukraine), e-wallet payments accounted for 23 percent of all transactions, with a credit card and cash as preferred options.58

Although progress is slow, there is a movement towards more cashless payment methods.

> Companies offering DFS for healthcare models exist in two out of ten countries in Eastern Europe.

> The most common DFS for healthcare models found in Eastern Europe were digital payments (3) and Insurtech (2).

> The top healthcare DFS products or services offered by these models in Eastern Europe are billing and patient management.

> The most prevalent health area DFS for healthcare models focused on was general healthcare. The main target customer base for these models were providers.

> Of the nine DFS for healthcare models, no DFS specifically focused on vulnerable populations or women.

Digital financial services remain heavily regulated in many of the Baltic states in Eastern Europe. While DFS companies are exploring their options for expanding into industries such as healthcare loans and life insurance, there remain several regulatory and infrastructure challenges. Government regulations focused on DFS and digital healthcare innovation could significantly push the creation and adoption of already successful models in the region. Currently, stringent regulatory and KYC requirements in many countries in Eastern Europe require the consumer to show multiple forms of ID, such as passports, residence permits and driver’s licenses.59 The road ahead includes the task of assuring DFS privacy, safety, and higher efficacy of verification processes.

Varying forms of public and private healthcare insurance programs in Eastern Europe have cultivated traditional and innovative insurance models, modernized by digital distribution channels such as smartphone applications, gamification, and remote access to Telehealth services. Adoption of DFS in Eastern Europe is slower than in other regions, and it generally targets the wider population in order to first demonstrate success in DFS emerging technologies. The gender equity gap in Eastern Europe is relatively smaller than in other regions, as many countries have a long history of striving for gender equality. Distribution channels such as these – in addition to enabling regulations – could be especially useful in improving women’s economic empowerment (WEE) and closing the gender gap in finance, education and healthcare in Eastern Europe.