Banking Regulations Compliance Crucial for Albania’s Financial Stability

The Bank of Albania has reiterated its commitment to promoting and supporting the normal functioning of payment systems in the country, as per its main objective of achieving price stability. This responsibility is enshrined in the Law on the Bank of Albania.

Licensing and Regulation of Banks

The Law on Banks in the Republic of Albania grants banks and branches of foreign banks the right to participate in electronic payment systems, subject to regulations issued by the Bank of Albania. The law emphasizes that the activity and participation of these institutions in such systems is a competency of the central bank.

Comprehensive Oversight of Payment Systems

The Law on Payment Systems has introduced comprehensive oversight of payment systems, including payment instruments, in line with international trends on the legal consolidation of oversight functions. This law sets out clear rules on licensing, regulation, and inspection based on the liberalization of the payment systems market.

Promoting Smooth Operation of Payments Systems

According to Article 3(4) of the Law on the Bank of Albania, the central bank is responsible for promoting the smooth operation of payments systems. To achieve this, the Bank of Albania is working in collaboration with banks to establish regulations and procedures for payment execution rendered by payment instruments used as means of payment.

Investigative Powers

The Bank of Albania has been granted investigative powers under Article 9 of the Law on Payment Systems, enabling it to ensure compliance with the law and subsidiary legislation. The bank can also regulate and oversee the issuance and use of payment instruments as part of the domestic payment system.

Authorization and Supervision of Payment Institutions

In a related development, the Law “On Payment Services” has given payment institutions the right to operate payment systems, subject to authorization, regulation, and supervision by the Bank of Albania. The law emphasizes the importance of settlement finality in payment systems and requires payment service providers to ensure that their activities do not impair financial stability or hinder the bank’s ability to monitor compliance.

Conclusion

Overall, banking regulations compliance is crucial for ensuring the stability of Albania’s financial system, and the Bank of Albania is committed to promoting a safe and efficient payments environment.