Jorgovanka Tabakovi: Instant payments, global inspiration
Speech by Dr Jorgovanka Tabakovi, Governor of the National Bank of Serbia, at the
opening of the conference "Instant payments, global iInspiration", organised by the
National Bank of Serbia, Belgrade, 6 March 2024.
* * *
Ladies and gentlemen,
On the brink of a new era, we have gathered at the conference themed "Instant
Payments, Global Inspiration" to jointly embrace the future of innovative types of
payments that is approaching us at a fast pace. As the Governor of the National Bank
of Serbia, I have not only the honour and privilege, but also a deeply personal
responsibility to open this gathering, which is a reflection of our shared commitment to
creating a more inclusive, accessible and efficient economic environment.
Critical for the development of the economy, as well as of the payment ecosystem, are
stable and predictable business conditions, echoed by the movement of
macroeconomic indicators. Despite the challenges posed by global uncertainty, the
National Bank of Serbia carefully weighed its decisions and gradually tightened its
monetary policy stance in the fight against inflation, using all instruments on hand, and
has thus contributed to the preservation of the country's overall macroeconomic
stability. Regardless of the multidimensional crisis - the pandemic, the energy crisis
and the situation in Ukraine, even in conditions when many developed countries are
struggling with recession, we have managed to maintain economic growth and record
employment gains. Since peaking in March last year, inflation has been on a steady
downward path and we expect it to continue down going forward. The fall in inflation
was largely aided by monetary policy with a measured but well-timed increase in
interest rates, which also had a favourable effect on the stabilisation of inflation
expectations. Early last year, when double-digit inflation rates were recorded, I pointed
out repeatedly that at the end of 2023 it will be at a twice lower level - and that has
come true. The strong fall in inflation continued this year as well. In January, y-o-y
inflation declined further, to 6.4%, fully in line with our nowcast model. Our estimate is
that inflation slowed down further in February, to around 5.5% y-o-y. We continue to
keep a close eye on domestic and international factors, ready to take additional
measures if necessary.
For more than a decade, the National Bank of Serbia has maintained the stability of the
exchange rate through well-timed and unbiased interventions in the FX market in either
direction, which contributed not only to lower core inflation, but also to preserving
confidence in the business and investment environment. A stable exchange rate is the
key ingredient to monetary and financial stability in Serbia and plays an important role
in creating a favourable environment for citizens and businesses. The National Bank of
Serbia remains committed to maintaining high FX reserves as the foundations of the
country's resilience to external shocks and to safeguarding the stability of the dinar as
the pillar of macroeconomic stability.
Our activities have ensured the reliability of all six payment systems that we operate, as
well as the safety and efficiency of execution of payment transactions in those systems.
At this moment, apart from the standard account to account transfer, instant payments
are also used for the payment of bills by scanning the NBS IPS QR code, payment in
physical and internet points of sale and transfer of funds via a mobile phone number.
We provided to households and corporates an extremely simple model of paying their
monthly bills by scanning the NBS IPS QR code via mobile banking applications on the
bills issued by providers of utility and other services. We enabled the execution of
instant payments on points of sale via different methods (IPS show, IPS scan), thus
giving a chance to merchants to offer at their points of sale a new, modern instrument
allowing funds disposal within seconds, at lower fees, and to independently prepare
solutions tailored to their needs. We gave the opportunity to citizens to simply execute
instant payments via mobile banking applications, just by entering the mobile phone
number of a registered payee or selecting it from their phonebook, without bothering to
remember templates or write down or enter the payee's account number.
In other words, rather than just dealing with money in its basic form, a traditional task of
institutions such as ours, we are stepping up and modernising the financial future of our
country, so that each and every citizen has the opportunity to participate in the digital
economy with ease and certainty.
I recall the day when first ideas about instant payments were no more than an outline
on paper, a dream of faster and safer payment in every situation. That outline has long
become the reality of the Republic of Serbia and a part of our everyday habits. The
possibilities of cashless payments that we will consider at this conference reflect our
wish and determination to continue to exceed the average speed of positive change in
the world, because we have proved we can do it. And as we do it, we also signpost the
way and serve as an example for many countries around the world. The National Bank
of Serbia receives compliments from institutions such as the European Central Bank,
International Monetary Fund, World Bank, while many countries from different
continents asked to learn from us and we generously provided our help.
In light of Seneca's wise words: "If one does not know to which port one is sailing, no
wind is favourable," I am thinking about the journey undertaken by the NBS. This quote
reflects the very essence of our efforts: to have a clear vision and goal ahead of us. It is
precisely this clarity of direction that has enabled us to turn each challenge into an
opportunity and each effort into a step towards success. It took time, patience and
unremitting commitment to achieve what we have today - a Serbia which is on the map
of global leaders in innovation.
In the digital world where borders are disappearing faster than ever it is our
responsibility to Serbian citizens to make clever use of the technological development.
To integrate new opportunities and raise the standard of security and reliability in
financial exchange.
Innovation is what differentiates a leader from a follower. All of us here today have the
opportunity to change things and introduce new products and services, but
responsibility goes hand in hand with this.
By trimming interbank fees, we directly reduced the costs for merchants, facilitating
their decision to accept payment card payments. In addition to the NBS IPS system, I
must also mention our DinaCard and numerous activities to develop the national card
system. It is an important pillar of independence of the national payment system. In a
sound way, it contributes to the profitability of accepting card payments, wider
availability of payment services, all of which has a direct positive impact on further
economic development and the reduction of the grey economy in Serbia.
As the central bank, we feel a connection with each individual whose life we can make
better. And I also believe that we share with you a vision where payment services are
not a privilege, but the right of each man. For centuries we have lived in a region where
we are often at a crossroads, where our decisions and actions take place in a more or
less dramatic context or circumstances. And this is not likely to change. But our doubts
and hesitations today will always be the greatest impediment to our achievements
tomorrow. For this reason, we need to move forward and have great confidence in
ourselves and our abilities. I have personally always trusted in the power of innovation
and progress. I did not begin my career in the world of finance, but in the very heart of
education, where the seed of all great ideas is most often born. A passion for
knowledge and learning continues to guide me to this day, and I am aware that the only
way forward is through constant improvement and advancement, sometimes even
despite the changes brought by the future.
For this reason, as we are working to enhance our instant payment system - the NBS
IPS system, let us also recall the words of Miloš Crnjanski: "To the future we should go.
All happier nations look to the future and go towards it." May our joint work not turn into
a mere record in the history of payment innovation. May it be a bright example leading
the generations to come, evidence that once vision, innovation and cooperation are
joined together, there are no limits to what can be achieved. Thank you for being here
today, not only as conference participants, but also as partners in shaping this future.
Ready to create a better future for Serbia together with you, a Serbia which is a part of
the world and not looking at anyone's back but at the progress of its future generations,
I extend my warm greetings and thanks.