Exploring Business Opportunities in Kosovo

What market trends are you seeing in your country?

Kosovo’s economy continues to show resilience and significant growth becoming one of the fastest growing economies in the region in relative terms (4.3% growth in 2024). We see several key trends that are shaping the MSME sector in Kosovo:

• Digital Transformation: Micro, Small and Medium Enterprises (MSMEs) are adopting more and more digital tools for business operations, payments, and customer engagement. As these enterprises continue to expand, the demand for internal efficiency is increasing as well. Digital banking, sales and financing solutions tailored to MSMEs show significant progress. Kosovo's Information Technology (IT) sector has experienced significant growth, establishing itself as a dynamic contributor to the nation's economy. In just four years the exports have increased by nearly 300%, which was driven predominantly through exporting services to EU and US markets.
• Regional Expansion: As some of Kosovo’s MSMEs reach the limits of their domestic market, they are actively seeking to expand into new regions, primarily within the Western Balkan Six (WB6) countries. To accelerate their growth, they need potential investors to provide them with assets adding values such as equity, regional know-how, operational efficiency, and technology to scale.
• Green Investments: Kosovo's energy production has historically depended heavily on lignite coal, which accounted for approximately 91% of electricity generation as of 2022. However, the government has initiated a strategic shift towards renewable energy sources to enhance sustainability and reduce environmental impact. The National Energy Strategy aims to increase the share of renewables to at least 35% of electricity consumption by 2031, targeting the development of 600 MW of wind, 600 MW of solar photovoltaic (PV). The country’s natural conditions, with mountains, and winds in higher altitudes as well as a solar yield potential of 1,350 kWh/kWp in a year – all of which support the transition towards renewable energies.

What makes your country special for companies seeking business there?

Kosovo offers significant advantages for MSMEs and foreign investors, particularly EU and German businesses: Kosovo's use of the euro as its official currency eliminates foreign exchange risks, ensuring a stable monetary environment that attracts investors and facilitates trade with the eurozone and Central European Trade Agreement (CEFTA) countries. Businesses benefit from lower transaction costs, price stability, and no currency volatility, making Kosovo a more competitive market. Kosovo has an internet penetration of 99% with 5G access mainly and over 2 million smartphone users in a country with a population of 1.6 million.
Kosovo has the youngest population in Europe, the median age is 34. Its multilingual youth are typically native Albanian speakers, fluent in English, and some even have high language skills in German. Lower labor and business costs make Kosovo an attractive destination for outsourcing and production. Kosovo has a strong talent pool in IT, engineering, and manufacturing, ideal for businesses looking to scale operations nearshore or within a friendly regional environment.
Another thing is that its location is strategic for regional trade by nature – positioned in the Balkans, Kosovo provides access to neighboring markets, including Albania, Montenegro, North Macedonia, and Serbia. Additionally, it also offers easy access to three regional shipping ports: Thessaloniki, Durres and Bar.
Then there’s the EU-oriented business environment, which is aligned with European trade standards. This makes it easier for MSMEs to integrate into EU supply chains. Kosovo is a member of the CEFTA and has recently strengthened its trade relations by signing the Free Trade Agreement (FTA) with the European Free Trade Association (EFTA).

Can you share a recent success story from your bank?

As the leading bank in the MSME sector with a market share of 21% at country level, ProCredit Bank Kosovo has supported MSMEs for over 25 years. A key to our success is our strong focus on sustainable finance and cross-border transactions. Our green loans enable clients to invest in solar energy, energy-efficient machinery, and sustainable production methods, reducing costs and improving competitiveness.
When it comes to digital solutions, our services as an MSME-oriented bank allow businesses to manage their finances efficiently through our fully online banking platform. Our ProPay transfer system offers a fast, cost-effective, and highly efficient cross-border payment solution within the ProCredit Group. Since many MSMEs in Kosovo rely on regional trade with Albania, North Macedonia, Serbia, and beyond, ProPay enables them to transfer funds within the ProCredit network at competitive rates and with same-day execution. This is critical for MSMEs in regional trade, as it improves liquidity and makes international transactions faster, secure and more reliable.

Which priorities do you see for your bank for the next year?

A: In 2025, ProCredit Bank Kosovo will continue to position itself as the leading MSME bank by focusing on the following key priorities:
We recognize that access to finance is a critical factor for MSMEs looking to grow, expand operations, and invest in innovation. To support this, we will:

• Expand tailored financing solutions that meet the diverse needs of MSMEs, including working capital loans, investment loans, and flexible credit lines.
• Support export-oriented businesses, helping them integrate into regional and EU supply chains, primarily in manufacturing and IT sector.
• Provide businesses with structured financial solutions, including advisory support, to help them make informed investment decisions.
• Additionally, sustainability is at the core of our banking approach. In 2025, we plan to increase our portfolio in green investments, energy efficiency projects, and eco-friendly business models. We also plan to support MSMEs in adopting renewable energy solutions, such as solar panels and energy-efficient production equipment, to reduce operational costs, provide advisory services on sustainability to help businesses transition toward greener practices while benefiting from cost savings and improved market competitiveness.