Kosovo within the region average of interest rates and with the fastest growth of credit

The banking industry in Kosovo in a very short time has managed to halve the interest rate on bank credits. According to data released by the Central Bank of Kosovo in December 2018, the average interest rate on new credits was 6.0% or the lowest Kosovo has ever had which presents improved financing opportunities not only to individual clients but also to small and medium-sized businesses. At a regional level, according to comparative data published by the World Bank in 2018, we can see equivalent interest rates on bank credit, where Montenegro stands at 6.36%, Northern Macedonia 6.1% and Albania 5.93%. These developments place Kosovo at the regional average in terms of the average credit interest rate.

On the other hand, according to the same source, it is noted that in 2018 Kosovo has had the fastest growth of credit in the region at over 11%, while Montenegro and Serbia 9% followed by Bosnia and Northern Macedonia with 5 - 7%. The credit value up to date in Kosovo is over 2 billion 942 million euros, with 63.6% of these credits being business credits and 36% individual credits, of which only 2.2% of the credit portfolio is non-performing credits.

Over the years, the banking sector in Kosovo has been very careful in creating a quality credit portfolio and at the same time enabling increased competition through advancing and increasing the number of products and services such as e-banking or contactless payments, however, an important characteristic is the high stability and liquidity, an indicator that enables the further growth of new credits.

The improvement of the conditions of doing business in Kosovo has made possible the significant reduction of the average interest rate on credit and the increase of the overall value and maturity of credit provided.