Methods of Payment
About 75 percent of Kosovo importers regularly receive goods under short-term supplier credit agreements. Longer-term financing may be sought for larger purchases but may be difficult to obtain. No credit rating agencies currently operate in Kosovo. Kosovo has a SWIFT code and uses the IBAN format for bank accounts.
Kosovo uses the euro as its national currency even though the country is not a member of the Eurozone. As such, the country has no independent monetary policy.
Kosovo’s banking system is well-regulated, profitable, and liquid. The Central Bank of Kosovo (CBK) is an independent public agency with the authority to license, supervise, and regulate financial institutions and insurance companies in Kosovo. The CBK has adopted banking rules and regulations in line with the Basel Accords and EU directives.
Twelve commercial banks, nine of which are foreign-owned, operate in Kosovo, representing 68.4 percent of total assets in the financial sector. Foreign commercial banks account for about 84.9 percent of total banking system assets, and three domestic banks account for the remaining 15.1 percent. Pension funds represent 24.5 percent of financial system assets, followed by microfinance institutions (4.1 percent), and insurance companies (3 percent). In June 2023, financial sector assets, including banks, pension funds, insurance companies and microfinance, amounted to €11.9 billion, recording an annual growth rate of about 10.5 percent.
Neither the banking sector nor local commercial enterprises are sufficiently capitalized to finance large investment projects. In 2022, new investment loaned to enterprises represented 58.9 percent of total new loans issued during that period. In 2022, approximately 85 percent of bank loans have maturities of over two years, with maturities of two to five years accounting for approximately 61 percent of loans. Approximately 62 percent of loans are directed towards enterprises. Kosovo signed the Foreign Account Tax Compliance Act (FATCA) with the United States in March 2015. FACTA is an information-sharing agreement between the Kosovan government and the U.S. Department of Treasury that ensures that American citizens and legal permanent residences with foreign-held bank accounts comply with their U.S. tax obligations.
There are no special rules or regulations that might impact U.S. businesses.
Foreign Exchange Controls
Kosovo unilaterally adopted the euro as its national currency in 2002. The CBK has no monetary policy tools to influence its currency. Other than reporting to Kosovo Customs the removal or importation of €10,000 into the country, there are no currency or payment restrictions related to the use of the euro in Kosovo.
U.S. Banks And Local Correspondent Banks
There are no U.S. banks operating in the market or local correspondent banks in Kosovo.
To access Kosovo ICS section on financing, visit the U.S. Department of State Investment Climate Statement website.