This article was written by David Gyori, fintech writer, speaker, researcher, consultant and trainer. He is the founder and CEO of Banking Reports, and a member of the Panel of Judges of the European FinTech Awards.
In April and May this year (2016) I had the chance to visit Albania twice and meet 25 leading bankers there. Albania exceeded my expectations tremendously.
Before I first landed at Nënë Tereza, the International Airport of Albania (named after Mother Theresa who actually was Albanian), I had some fears. I thought I was going to go to an absolutely disorganized, untrustworthy and hopeless country. I was totally wrong. I was the victim of the negative stereotypes linked to the country (crime, corruption, lack of transparency, poverty and much more). Even after having shared my positive experience my friends come up with things like ‘but it must be so corrupt’ or ‘their banks must be too small to work with’ or they just laugh loudly when they hear that I had something to do with Albania; or – the most stereotyping reaction – ‘have you seen my stolen car there?’
Those are the stereotypes, but let’s now see my personal experience!
1. Human Factors
English language: Albanian people generally speak good English, they understand things well and they express themselves in an efficient and clear way. They are also happy and ready to use English.
Higher education: Bankers I have talked to explained me that in the last 10 years a new trend of almost all high-school students studying further and going to college or university has emerged. Banks have a strong labor market from which to select well educated and competitive new colleagues.
History of openness: Albania emerged from the Second World War with a Jewish population 11 times higher than before the war. Following a traditional custom of hospitality, the Albanian population mostly protected Jews – as visitors, who have to be protected – in spite of the very poor country being first occupied by fascist Italy, followed by Nazi Germany.
Ambitions, knowledge and modesty: The 25 leading bankers I met made a very positive impression on me. Their knowledge is on a par with Western competitors, yet their appetite for more information is just huge. Their openness towards learning new things is uniquely large and in spite of their very high-quality knowledge they are modest and kind.
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2. Macroeconomic Factors
European Union: Albania wants to become a member of the European Union. They are working hard to harmonize their laws. This is especially positive at a time when some nations – already members – are working on the exact opposite.
Euro: Albania’s official currency is the Albanian lek – the ISO 4217 Code is ALL. The EUR/ALL FX rate has been moving in a tight range of 135 to 145 throughout the last 6 years. Bankers I have talked to explained this as a ‘natural peg’: the Albanian economy is so closely tied to the economies of the eurozone that the currency (ALL) naturally follows the euro.
Tourism potential: In terms of tourism potential, Albania has it all. Sea and mountains, palm trees and blue shores, very competitive prices and generally good service attitude.
IMF and World Bank: Albania is highly cooperative with international financial institutions such as the IMF and the World Bank. This ensures textbook type orthodox fiscal and monetary policies and provides – along with an increasingly educated population – a clear path to a healthy macro economy and more prosperity in the long run.
The Albanian fintech scene is quite nascent. Yet, some banks are paving the way ahead: I have tested the mobile banking application of a leading Albanian bank and it is stunningly clear, advanced and top quality, basically on a par with any global competitor from any mature market.
Remittance payments are a significant part of the Albanian economy and this market is under served, so there is space to come in and cooperate with local entities in remittances. Albanians living abroad are bringing money home on a regular basis. The Albanian diaspora prefers cash as the format of bringing value back to their home country from Greece, Turkey, Italy, Germany, Switzerland, France, Austria, Belgium and from some growing communities in the UK, the USA and Canada. Some of these cash based remittance flows can be – by offering the right services for the right communities – digitalized.
Albanian millennials are well-educated, speak good English and are open towards digital innovation and excellence, and therefore make a good target-group for any fintech product. Albania is a small market, but has all qualities needed to function as a test-market before going big with certain innovative solutions.
Albania is a good source for finding cost efficient and flexible software-engineering and coding capacity. Some Albanian banks are looking for international partners to co-join Western fintech labs or to co-organize regional fintech events. A joint fintech hackathon targeting talent from the Balkans region could also be a viable idea that Albanian banks would probably happily participate in.
Based on all I have seen and experienced, Albania is a precious diamond going through the hard and painful – yet rewarding – process of becoming shiny and widely recognized. I wish them absolutely the best!