EUR 8M World Bank Loan to Transform Montenegro’s Digital Payment Landscape

In a significant step toward modernizing its financial infrastructure, the World Bank’s Board of Executive Directors has approved an EUR 8 million loan to Montenegro. The funding will support the Montenegro Financial Infrastructure Modernization and its Alignment with Single Euro Payments Area (SEPA) Standards Project, also referred to as the TIPS Clone Project. This initiative is designed to bolster digital payments, promote financial inclusion, and lower transaction costs for both domestic and international transfers.

The project marks a critical milestone for Montenegro, a country with deep reliance on international remittances and cross-border economic flows. By enabling fast or near-instant digital transactions, the country aims to become more financially inclusive and better integrated into the European Union’s payment ecosystem.

A Push Toward Fast, Seamless, and Inclusive Transactions

At the core of the project is the implementation of Target Instant Payment Settlement (TIPS)—a real-time payments platform developed by Banca d’Italia in collaboration with the Eurosystem. The system allows for instant transfers in euros across banks and borders, improving access to secure, low-cost, and convenient financial services.

Montenegro will deploy a TIPS “clone” solution, enabling full compatibility with pan-European instant payment systems. This move not only enhances the efficiency of Montenegro’s domestic financial transactions but also accelerates its financial integration with the European Union, a key goal of the country’s EU accession strategy.

“This is not only a technical upgrade but a strategic investment in competitiveness and regional integration,” said Xiaoqing Yu, World Bank Division Director for the Western Balkans. “Modern payment systems can greatly facilitate economic growth in Montenegro, enhancing the competitiveness of Montenegrin businesses.”

Expanding Access and Lowering Costs for Individuals and SMEs

The project seeks to increase digital payment usage by 33% before 2030, reaching an additional 110,000 people—of whom 70,000 are women. These gains are expected to reduce dependency on cash, strengthen consumer protection, and enhance the ability of individuals and businesses to save, invest, and manage their finances more securely.

A key focus of the project is financial inclusion, particularly for the estimated 15% of Montenegro’s population that remains unbanked. These individuals currently operate outside the formal financial system, lacking access to transaction accounts or digital payment tools. This exclusion exposes them to greater financial risks and limits their ability to access credit, build financial security, or participate in the digital economy.

By targeting unbanked populations, the initiative aims to:

• Reduce barriers to account ownership

• Promote mobile and digital wallet solutions

• Encourage banks and fintech firms to innovate with inclusive services

• Support financial literacy efforts tailored to marginalized groups

Boosting Regional Economic Integration and EU Alignment

As part of the Western Balkans regional integration agenda, this project is strategically aligned with Montenegro’s 2025–2029 Country Partnership Framework, which emphasizes:

• Competitiveness through digital infrastructure

• Deeper regional cooperation, particularly in financial systems

• Sustainable and inclusive economic growth

The modernization of Montenegro’s payment infrastructure will support these goals by reducing transaction times and fees, thereby lowering barriers for cross-border trade, tourism, and investment. Businesses, especially micro and small enterprises, stand to gain from faster settlements and easier access to digital platforms.

This initiative also reflects a broader trend in the Balkans and Eastern Europe, where governments are pursuing EU-aligned financial reforms to stimulate innovation, boost resilience, and improve public service delivery.

Part of a Broader World Bank Vision for the Region

The TIPS Clone Project forms part of the World Bank’s broader support for financial modernization in the Western Balkans. The Bank is working across the region to promote:

• Digital transformation of public and private financial systems

• Strengthening regulatory oversight and cybersecurity frameworks

• Expanding digital financial services to underserved populations

By helping Montenegro modernize its payment ecosystem, the World Bank is fostering a more inclusive, competitive, and integrated financial environment, setting a precedent for other countries in the region aiming to improve their financial infrastructure and EU readiness.