Nontraditional and nonbank financial services and credit provided for individuals and businesses without regulatory overshight – shadow banking is on the rise in Albania. As informal lending and borrowing offer more financial benefits, they are sought despite inherent risks.
Shadow banking stands for the credit and banking services provided by financial intermediaries, without the security of central bank liquidity, to fill in the gaps in the regular, traditional banking system. Thus shadow banking challenges traditional banks to reach out to the unbanked and make the use of an account easier and cheaper e.g. by lowering fees or digitising payments. The term itself seems to have negative connotation but the phenomenon is not necessarily dangerous. Articles in the July edition of the Albanian magazine Bankieri dwell on the benefits, risks and challenges brought in by shadow banking as well as the need to monitor its entities and services. Shadow banking is also inspected closely in relation to its role in the financial crisis of 2007-2008.
Source: Shoqata Shqiptare e Bankave (Albanian Association of Banks),
Editorial: “Shadow banking in Albania The Past, the Present and the Future!”, by Prof. Asoc. Dr. Elvin Meka
“Shadow Banking and Opportunities in Banking Sector in Albania”, by Athanasios Paloudis
“A glimpse light on shadow banking”, by Teuta Baleta and Rinald Guri
Direct link: http://issuu.com/aabshshb/docs/bankieri_16_eng/1
Chosen by Anna Muszak