institutions. the cbk considers the kcgf as a very important mechanism to maintain and further advance the objective of a stable financial system, with an impact on the support of the economy. therefore, cooperation will also be strengthened in the interest of implementing these objectives. allow me to thank the swedish international development cooperation agency ( sida ) represented by the swedish embassy in kosovo for the continued support given to the kcgf in guaranteeing loans in order to increase lending in various sectors of economy and at affordable costs. thank you! 2 / 2 bis - central bankers'speeches

the stability of the banking sector, as one of the main sources of stability and growth of an economy. in kosovo, fortunately, we have a banking sector with a high degree of stability, which has the ability to withstand possible negative shocks and, at the same time, help the economy to cope with possible shocks with minimal consequences through stable financing. among the main challenges in modern banking are the advancement of digital banking and the issue of environmental impact on the banking system. during the last years, there has been an important development in the direction of digitalization of financial services, which is transforming the financial system. we see the process of digital transformation as an opportunity for financial institutions to become more efficient and to improve access to financial services for households and businesses. as for the field of payments, the cbk has taken some important steps in the liberalization of the market, where payments and money transfer services have been allowed to be offered by non - banking financial institutions. cbk has planned to further liberalize the payment services market by adopting the eu directive on payment services known as psd2, as well as the two eu directives addressing payment accounts and electronic money, in within the framework of the new law on payment services. this legal framework will allow a diverse group of payment service providers to operate and compete in the payments market, while also helping to create more efficient and affordable local and cross - border payments. it will also prepare us for meeting the conditions of application for membership in the european payments scheme known as sepa, as one of our main goals in the future. this legal framework will set the foundations for the next decade and bring more pronounced competition in the field of digital financial services. it should be noted that the banks in kosovo have been very proactive in terms of undertaking initiatives and actions for new developments and adaptation of the most modern technologies, comparable to those of western european countries. assessing and managing financial risks arising from climate change is one of the challenges facing supervisory authorities and the banking sector. within the western balkan countries, kosovo has also adopted the green agenda for the western balkans at the sofia summit in november 2020, which is a comprehensive strategic roadmap regarding climate change. this agenda shows the way to new energy solutions, which means increased investments in renewable resources as well as sustainable environmental development. the banking sector represents the main component of the financial system of kosovo, so banks will play an important role in the transition towards the green economy. climate change creates risks for banks, so it