About 2 billion euros outside Kosovo banking system

According to their estimates and research done by local and international financial mechanisms, these tools can reach about 2 billion euros.

The informal economy in Kosovo was said to be among the Government leaders and international financial institutions. They have declared that between 400m and 500m euros are not collected during the year from the state ark.

Law Economic Analysis Professor Majid Bektash told Radio Free Europe that the consequences of keeping money outside the banking system are great.

“Expiry of cash that does not pass through legal channels in Kosovo is quite high. First of all, this is due to the existence of the economy in black, which is very high in us, and according to some international studies it is estimated to be about 30 to 35 percent of the gross local product or transformed into absolute value is estimated to be somewhere around 2 billion”.

“The consequences are high starting with budget reduction, because when money does not go into the fiscalisation system, tax on added value is not paid, as well as all other taxes”, Bektas points out.

Many businesses in Kosovo continue to avoid tax obligations, creating tax evasion, organised crime and damage to Kosovo's budget, at once Kosovo free market disorder, field experts say.

In this case through the informal economy, Bektash points out, both the country's budget and the living standard of each citizen of Kosovo is being hit.

“Arsyet for the existence of this economy that connects with the use of cash is different, from the efficient malfunction of the tax system, which means not to complete the payment system, then the tradition to pay for cash and not enough development of the electronic payment system, that in recent years there is a development but that in the report with developed countries is away from the”, Bektashi says.

On the other hand, Milazizim Abazi, connoisseur of the banking system, says that compared to the past years, Kosovo has managed to discipline the flow of money, but still there are cases of money circulation outside the banking system.

He adds that circulation of money outside the banking system is harmful to the economy in general.

The citizens need to be aware that using money is dangerous even for what they accept as well, as facing numerous risks, such as suspicious money, money, fake money and money from organized crime”, says Abazi.

Meanwhile, within the banking system, according to the latest Central Bank report, banking sector assets reportedly in March of this year marked annual growth of 8.0 percent, reaching 3.67 billion euros.

About two million is estimated to be the number of customers in ten commercial banks in Kosovo.

The financial and banking sector in Kosovo is almost the only sector that annually results in stable and stable performance.

Commercial bank activity, as one of the most profitable sectors in Kosovo, is dominated by loans, whose maturity deadline may be up to 15 years, depending on the type of credit.