NATIONAL BANK OF SERBIA
Introductory speech by Governor Jorgovanka
Tabaković at the opening of the 14th Conference on
Payments and Market Infrastructures
4 October 2022
Dr Jorgovanka Tabaković,
Governor
October 2022
Esteemed participants in the 14th Conference on Payments and Market Infrastructures, respected
hosts,
We are facing a new industrial revolution to which technological advancement contributes the most.
This advancement has brought numerous benefits to humankind. The benefit that I like the most is the
facilitated spread of knowledge and experience. I therefore wish to thank you for the invitation, but
also to welcome you to the 14th Conference on Payments and Market Infrastructures, which our friends
and colleagues from the Republic of North Macedonia, together with the central bank of the
Netherlands, have been holding for years already, and with great success, I must add. As the years go
by, new topics arise, new achievements are made, and payment services and the network of market
infrastructures are becoming increasingly more sophisticated. This tells us, to my satisfaction, that we,
as a society, are developing for the better. English philosopher and statesman Francis Bacon said that
"knowledge is power". Spreading knowledge by sharing it with neighbours, compatriots and colleagues
brings benefits to the entire humankind.
The present times bring novelties both in the financial sector and all spheres of life. This is something
we should not flee from, but we should rather thoroughly examine everything those novelties bring.
We all know that the financial service sector has witnessed enormous changes, and that smooth
functioning of payment systems is exceptionally important for the stability and efficiency of the
financial sector - and this will never change. The National Bank of Serbia, which I have governed for an
entire decade already, is carefully monitoring the market and the possibilities offered by the
technology and, based on that, it is creating new services and new payment systems, and introducing
new laws:
• We were among the first in the world to launch a state-of-the-art instant payment system
- the NBS IPS system, enabling citizens and businesses to make their payments easily,
quickly and, what is most important, securely, from any place in the country, 24 hours a
day, all year round, with money available to the payee within a few seconds only. The fact
that citizens and businesses have recognised the benefits of this system is shown by the
statistics that the number and value of transactions carried out through this system are
constantly rising. Since the inception of the system until today, over 113 million
transactions have been carried out, and the average time of execution is 1.1 seconds.
• Aware of our role of a change catalyst in our country, the National Bank of Serbia did not
stop there. Owing to a well established infrastructure of its IPS system, it is introducing
new, innovative instant payment solutions. By using the mobile banking application, our
citizens can make instant payments at physical and online points of sale. They can pay their
bills at any time of the day, from the comfort of their home, by scanning the QR code with
their mobile banking applications. They can also make instant transfers of money at any
time of the day, all year round, knowing only the mobile phone number registered by the
payee for that service.
• We have our national DinaCard and we have been constantly modernising it, aware of the
importance of costs, but still more so of the independence and stability of the domestic
financial system. We also established cooperation with two large international card
systems (American Discover and Chinese UnionPay), enabling the use of DinaCard abroad
as well.
• We have also seen a rise in cashless payments: in the past five years, the number of mobile
banking users in the Republic of Serbia has risen by 254%, while the number of electronic
banking users has increased by 106%.
• We enabled financial service consumers in the Republic of Serbia to conclude financial
service contracts by using video identification, with full transparency, security and
protection of citizens' rights. Just like everyone, we sometimes ask ourselves whether our
huge efforts have a purpose. However, the figures are reassuring and instil us with courage
to move forward. As many as 306,644 distance contracts have been concluded until today,
up by 45% compared to last year.
• Answering market needs, we also adopted the Law on Digital Assets, whereby Serbia
became one of the few countries in the world to regulate this area. By weighing up the
benefits of introduction of a central bank digital currency in an environment where instant
payments have fully taken root, we are currently analysing the introduction of a new
financial instrument from the functional and technical aspect, while also examining the
legal framework necessary for the functioning of the payment instrument.
As regional cooperation is important for our country, we participate in the Open Balkan initiative,
jointly contributing to the region's prosperity. To enable more efficient and cheaper payment
transactions in euros for citizens and businesses, the National Bank of Serbia introduced the systems
of international and interbank clearing of FX payments, which enable the transfer of funds in euros
every business day among system participants. In addition to banks with their head offices in the
Republic of Serbia, participants in the system of international clearing of FX payments include banks
from neighbouring Bosnia and Herzegovina, pursuant to the agreement on clearing of interbank and
international payments concluded between our two central banks. I must also mention a great
advantage of these systems, which is reflected in low costs for participants. Participants can also carry
out for their clients, within the same day, the transactions for orders sent until two o'clock. The success
is illustrated by the steady growth in transactions. I wish to highlight that in 2021 turnover increased
by 41% compared to 2020. In 2021, turnover was worth 773.6 million euros, and the upward trend
continued into this year as well.
I often like to emphasise the importance of international cooperation, which is why we launched an
initiative with some countries of the region, among others with our dear colleagues from the Republic
of North Macedonia, to join the international clearing of FX payments, which would further strengthen
regional cooperation and increase economic prosperity. Financial system connections can only be
beneficial - not detrimental to our states and citizens. Infrastructure once established will enable even
greater exchange of goods and services, while efficient payment operations should serve as support
and bedrock for that exchange.
We know that digital payments are going along a difficult and long development path. The Covid
pandemic doubtless brought about the popularisation of digital methods of payment, which should
certainly be one of the strategic objectives of each central bank. However, a cautious regulator must
strike a balance between development and safety.
Our great writer Miloš Crnjanski said that "hope is the highest degree of wisdom in human life". So let
us hope for the better. Let us be diligent and creative, helping each other and working towards the
joint interest of mutual cooperation and harmony. Nothing is impossible for those who work tirelessly
and with dedication. Inspired by the name of the organiser's highway, I wish all of us to always go along
the paths of friendship.
Thank you for your attention. I wish you all a successful conference and plenty of health!