Hungary - Country Commercial Guide
Trade Financing
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Hungary’s EU-harmonizing reforms have created a financial environment where virtually all capital-related institutions, products, and services can be found.  The Hungarian Forint has been fully convertible for all financial transactions since 2001, and both the Hungarian financial market and capital market transactions are fully liberalized.

The National Bank of Hungary (Magyar Nemzeti Bank – MNB) is the central bank and a member of the European System of Central Banks (ESCB).  The MNB and the members of its decision-making bodies perform their duties and carry out their obligations independently from the government.  Apart from the European Central Bank, the MNB (and the members of its decision-making bodies) may not ask for or follow instructions from the government, the institutions and bodies of the European Union, the governments of other EU member states or any other institution or body.

According to Act CCXXXVII of 2013 on Credit Institutions and Financial Enterprises (Financial Enterprises Act), credit institutions are financial institutions which collect deposits and provide credit lines and loans and perform other financial services.  A commercial bank may only operate in Hungary as a company limited by shares (Rt.) or as a branch office of a foreign bank.  In the case of a branch office of a foreign bank, a license for banking activities issued by its foreign authority is also required.  The Financial Enterprises Act determines the range of financial services that commercial banks may provide.

In Hungary, foreigners may only perform financial services in one of two ways: by establishing a company limited by shares and registered in Hungary, or by founding a registered branch office. Banks - including the branch office of foreign credit institutions - may be founded with a minimum of HUF 2 billion (about USD 7 million) in initial capital.  A foreign registered credit institution may also establish bank representation but may not perform any kind of business activity.

Since Hungary’s accession to the European Union, credit institutions registered in another EU member state may engage in cross-border services.

Financial institutions whose controlling interest is owned by foreign professional investors constitute more than 90% of the registered capital of the sector including 35 commercial banks (see their list on the website of the Hungarian Banking Association. The Hungarian Development Bank – a bank offering favorable credit facilities to Hungarian businesses implementing economic development projects – and Eximbank – a bank serving Hungarian exporters by providing them effective financing and insurance facilities – have been owned by the state ever since their founding in 1993.  In 2015, MKB and Budapest Bank became state property, increasing state-ownership to more than 50% of the banking sector in Hungary.   Although foreign investors had controlled 80% of the banking sector in Hungary, this was reduced to 47% in 2016.  The dominance of foreign ownership has been crucial in upgrading the formerly one-level banking sector to a double-level one which meets international standards. The U.S. exporter should be aware that access to capital in Hungary is still difficult and limited, compelling many Hungarian SMEs to depend on self-financing, including payments for imports.  For this reason, U.S. exporters tend to offer 60-day or 90-day payment terms to their Hungarian customers, after establishing a track record for payments.

A bank account at a commercial bank is required to register and run a company in Hungary.  Wire transfers are used for more than 80% of payment transactions, and new customers are sometimes required to pay in advance.  A letter of credit is often used for more significant and high-value first transactions before mutual trust develops between partners.  Credit cards are also used but mostly for individual purchases.  The largest commercial banks in Hungary are: OTP - Hungarian Savings Bank, MBH (Hungarian Bank Holding), Commercial and Credit Bank (K&H), UniCredit, Erste, Raiffeisen, and CIB Bank.  They are all members of the Hungarian Banking Association.

Methods of Payment

The use of cash is still largely dominant in Hungary but the number of retail transactions with bank or debit cards (Visa, Amex, and Mastercard) has grown significantly in recent years.  Particularly in cities, consumers tend to use bankcards in malls, hyper- and super-markets, petrol stations, restaurants, and to pay for accommodation during holidays.  Card payments account for roughly 38-40% of retail payments in Hungary, compared with 75-80% of purchases across Western Europe.  Hungarian consumers pay by bank cards three times more frequently than cash, still the value of cash withdrawals is three times as big as that of card payments.  All commercial banks in Hungary replaced the magnetic bank cards with the chip-based bank cards and have been offering no-fee cash withdrawals twice a month to their clients. Checks are not used at all.  A wide and reliable network of automatic teller machines (ATMs) operate throughout Hungary. There were 4,825 ATMs in Hungary at the end of June 2023. The use of these ATMs has also been favored by Hungarian consumers.

How Does the Banking System Operate?

The Hungarian banking system is a two-tiered banking system, with the MNB occupying the first level, with the primary objective of reaching and maintaining price stability.  The Central Bank’s rights and duties include forming and implementing the country’s monetary policy, managing the production and distribution of the Forint, and managing the accounts of commercial banks.  Unlike the Federal Reserve, the MNB is only allowed to contribute to the government’s economic goals if the measures do not pose a threat to price stability.

On the second level are the credit institutions - including banks, credit unions and saving cooperatives. They collect deposits and offer further financial services for Hungarian citizens and businesses.  Please see above for a list of the major commercial banks in Hungary.

Foreign-Exchange Controls

There are no foreign exchange controls in Hungary.

U.S. Banks and Local Correspondent Banks

 At present, Citi is the only U.S.  bank operating in Hungary but since Citi sold its consumer banking business in 2015 it only offers commercial banking services in Hungary.  U.S. issued checks cannot be cashed in Hungary.

The U.S.-based BlackRock, the world’s largest investment management company, entered Hungary in 2017 with a global technology and innovation hub in Budapest.

For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide.  To access Hungary’s ICS section on financing, visit the U.S. Department of State Investment Climate Statement website.