Registered Financial Institutions

FGK can register a Financial Institution licensed by the Central Bank of Kosovo and operating in the Republic of Kosovo. For registration purposes, the financial institution (FI) must meet the following criteria:

• Have a sound financial condition, as evidenced by adequate capital, satisfactory asset quality, sustainable earnings, and satisfactory liquidity.
• Have a satisfactory corporate governance structure, as well as sound credit policies and procedures.
• Have adopted an Environmental and Social Management System in accordance with IFC/World Bank Standards, ensuring that loans comply with environmental criteria.
• Have a satisfactory shareholder structure. The FI will be subject to a Know Your Customer (KYC) identification and verification process of the applicant and assessment of the Ultimate Beneficial Owner (UBO) for all shareholders owning more than twenty-five percent (25%) of shares in the applying FI, in accordance with the FGK Anti-Money Laundering and Counter-Terrorist Financing Policy (hereinafter: FGK AML/CFT Policy).
• Have policies and procedures in force and a complete and effective Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) program, and comply with all requirements set forth in the applicable AML/CFT Law and the FGK AML/CFT Policy.
• Have a good reputation in the market.
• Have risk management frameworks at acceptable levels, in compliance with FGK standards and requirements.
• Have a satisfactory portfolio quality management structure.
• Have at least three (3) years of existing experience in the MSME market and demonstrate readiness and a clear plan to further penetrate the MSME segment.
• Demonstrate willingness to take greater risk and improve lending conditions for eligible borrowers.
• Have adequate MIS systems and appropriate staff to enable timely reporting of eligible loans in accordance with FGK reporting requirements.

The following criteria may lead to rejection of the application:

• If the applicant does not meet regulatory capital requirements as evidenced in the latest audit report, unless there is a rational explanation for such non-compliance.
• If the NPL ratio of the applying FI is higher than the market average in the active business loan portfolio and the annual write-off rate exceeds one percent (1%) during the last three years, based on data provided by the applying FI or official reports provided by the CBK.
• If the FI is unable to provide the necessary information for conducting the KYC assessment.
• If the applicant FI, its board, or senior management are subject to any enforcement action or sanctions by the CBK, or are not compliant with standards established by the Financial Action Task Force (FATF), according to the KYC assessment and other conditions set forth in the applicable AML/CFT Law and the FGK AML/CFT Policy.
• If the applicant FI has operated in the MSME market for less than three years.
• If the applicant FI is an MFI with an active loan portfolio of less than ten million (10,000,000) euros and operates only in one region.
• If the applicant FI is an MFI with an NPL ratio higher than five percent (5%) in the current active outstanding business loan portfolio and its annual write-off rate during the last three years exceeds two percent (2%).