Bank cards in Kosovo and their importance in the economy

31.08.2021, Pristina

Written by Petrit Balija 

During the first six months of 2021, banks approved 10,842 bank cards, reaching a total of 1,388,757 active cards in possession of bank customers, thus marking an increase by 4.8% compared to the same period one year earlier.

Bank cards are payment instruments issued by banks so that customers can have access to their financial means at any time to make payments as well as to withdraw cash from ATMs.

Although bank cards are a technology, which has been invented many decades ago, around 1967, the use of bank cards in Kosovo and the region remains under the shadow of cash, which is dominating payments in the economy. However, the trends of banking customers in recent years are in the direction of using digital services, including bank cards.

Cards with a debit function dominate the total number of bank cards by 87.1%, while 12.9% of them have a credit function. During the same period, debit cards increased by 5.1%, while credit cards increased by 2.8%. 

Through bank cards, citizens are able to make transactions and bank payments at any time, online, or through the network of points of sale (POS). It is important to point out that, from the total number of bank cards, about 57% of the total bank cards operate without physical contact, they are (contactless). This is a very important factor when making payments, given that during the period of pandemics it is recommended to reduce physical contact as much as possible.

At the time when the economy was closed due to restrictive measures for prevention and protection against COVID 19, namely during the second quarter of 2020, there was a slowdown in the trend of the number of transactions by bank cards, where there was only 1.2% increase compared to 2019. However, the number of bank card transactions marked a sharp increase during the second quarter of 2021, where over 4,488,976 transactions were registered, which represents an increase of 33% compared to the same period of 2020. This increase in bank card transactions is a positive indicator both for the replacement of cash with transactions by cards and for the country's economy as a whole. The benefits and advantages for bank card payments are numerous, including:

Higher security and more efficiency in payments, enabling payments also for transactions in low value for daily transactions;
Bank card payments can be made on all POS devices of Kosovo banks, without commission and irrespective of the amount paid;
Bank card payments help fight the informal economy and prevent the spread of counterfeit money;
Easier and faster management of finances by monitoring the electronic banking report; 

The banking sector in Kosovo has continuously been contributing to the digitalization of processes, digitalization of banking services and products according to best international standards and practices. To this end, the Kosovo Banking Association, in cooperation with Mastercard and commercial banks in Kosovo, have organized a very successful awareness campaign on the benefits of payment by bank cards. We are grateful to these partners, who have been contributing considerably to the economic advancement and development of Kosovo, by providing the necessary infrastructure and payment services to businesses and households in Kosovo.