The Development Bank of Montenegro, officially operational since the beginning of the year, is still unable to perform payment transactions—one of its key functions as per the law. Instead of opening accounts for clients and entering the payment transaction system, the bank is entangled in bureaucratic delays between the Ministry of Finance and the Central Bank of Montenegro (CBCG), and it has not yet opened an account for payment transactions with the CBCG.
The bank, which was created by transforming the Investment and Development Fund (IRF), currently only performs crediting activities, as was the case with the IRF. Once it can handle payment transactions, businesses will be able to open accounts and make deposits through the Development Bank. The bank will offer lower interest rates on loans, longer repayment periods, and less stringent collateral requirements compared to commercial banks.
Despite these delays, the bank has increased its lending activity. In the first quarter (January-March), it granted over €46.5 million in loans, a 35% increase compared to the same period last year. The Development Bank’s management is working on optimizing its credit offerings and creating new products, particularly for local production and vulnerable groups.
The Ministry of Finance has supported amendments proposed by MPs Jelena Nedović and Vasilije Čarapić to allow the Development Bank to provide payment services, similar to Croatia’s Bank for Reconstruction and Development. However, the payment system remains under the control of the CBCG, and the necessary regulatory amendments are still pending.
The bank hopes that the required sub-legal acts will be established within 12 months, enabling it to provide complete banking services to Montenegro’s economy. The Ministry of Finance is working with relevant parties to draft these acts and will consult with the European Commission before adoption. The Development Bank will not accept deposits from individuals, as confirmed by the Ministry of Finance.
