Proposals for a national fintech strategy have emphasised the potential role of the insurance and pension sector, suggesting that it could be a "driving force" for technological development and innovation.

The proposed strategy, a joint project by Copenhagen Fintech, the Danish Finance Association, Finance Denmark, Insurance & Pension Denmark (I&P Denmark) and Danish Industry (DI), aims to outline plans for how Denmark can maintain and expand its position as a global frontrunner in financial technology.

It was shared in response to some of the key challenges and opportunities facing Denmark, including maintaining strong competitiveness, attracting venture capital and talent, and contributing to a more sustainable and digital economy.

The report identified six "crucial" areas of focus, designed to show how fintech can truly become a growth engine for the entire Danish business community, create new jobs and be a key to both digitalization and the green transition.

The role of pensions and the broader financial services industry was highlighted as a key factor, as the report noted that the established financial sector plays a "critical role" as a driver of technological development and innovation.

The report explained that, currently, Europe's capital markets remain fragmented, making it difficult for innovative companies to access growth capital.

As a result, pension funds in Europe rarely invest in venture capital funds, limiting the financing of new high-tech startups.

However, it said investments in advanced technologies such as AI, blockchain, and quantum technology enable solutions to key societal agendas such as digitization, green transition, and increased economic growth across industries.

Indeed, it pointed out that, through collaborations with banks, pension funds, and insurance companies, fintech players are developing new solutions such as embedded finance, digital onboarding processes, and personalized advice based on real-time data and AI.

Given this, the report stressed the need for the government to support the established financial sector with innovation and new business models. 

I&P Denmark CEO, Kent Damsgaard, said: "The insurance and pension sector, like the rest of the financial sector, is a driving force for technological development and innovation.

"A well-functioning fintech ecosystem strengthens innovation, economic growth and job creation, while having a strong fintech industry strengthens European competitiveness.

"The strategy is to put even more power behind investments and technology, so that we position Denmark and the Nordic region as a leading global fintech region."

Adding to this, Copenhagen Fintech CEO, Thomas Krogh Jensen, said: "We have built a strong ecosystem in just a few years, but we need to lift even more collectively to be able to match the investments in the US and Asia.

"This strategy gives Denmark a crucial springboard to create more growth companies, attract international capital and ensure that we continue to shape – and not just follow – the development."

---