By Brian Maguire

Albania might seem an unlikely home for a bank with no branches. Cash still moves much of the economy, and a large informal sector sits outside the formal financial system. Yet it is here that the Western Balkans’ first fully digital bank has taken root.

That bank, Jet Bank, is the region’s first to run on a wholly digital, branchless model, according to Elvin Meka, vice rector and dean of the faculty of business and law at Tirana Business University College. He calls it a new reality in Albanian finance.

The contrast is the point. In an economy defined by cash and informality, Meka sees a “leapfrogging” moment – a “laggard opportunity” that “may turn into a big business advantage by tapping not only the existing customer base, but also the unbanked or underbanked consumer”.

Branchless banking, he argues, can be “an excellent lever for reaching practical results in financial inclusion and economic formalisation at the same time”. He cautions it is no master key, but rather a way of “increasing the visibility of economic activity”.

Governing digital finance

The timing matters. As Jet Bank scales, the EU is rewriting the rules that will govern digital finance across the continent – and, in time, across the candidate countries hoping to join it.

At the centre sits the payments package agreed late last year: the third Payment Services Directive and the Payment Services Regulation. Both are meant to level a field that has long tilted toward incumbents.

For Andi Cristea, a member of the European Parliament, the reform does not fix everything, “but they fix the imbalance that mattered most”. Until now, he notes, payment firms reached Europe’s payment systems “through the very banks they were competing against”.

Under the new rules, they can connect directly. “That is a real change,” Cristea says. What legislation cannot equalise, he adds, is the deposits, customers and branch networks that established banks still command.

Creating a level playing field

Aura Salla, also an MEP, frames the stakes as unfinished business. PSD2, she says, “did not fully deliver on its objective of creating a level playing field between banks and new innovative companies in the sector”.

The successor rules, she argues, “need to remove the remaining barriers, strengthen competition, and enable new payment service providers to scale throughout the Union” – while keeping the burden on banks “proportionate”.

Both MEPs land on the same warning: a single rulebook is worth little if it fractures on contact with 27 supervisors. “A level playing field is written by legislators,” Cristea says, “but it is delivered by supervisors.”

For a digital bank built to scale, fragmentation is the enemy. “Europe does not need 27 digital banking markets. It needs one,” Cristea says, singling out onboarding as “where the single market is least single”.

A real common rulebook

Salla puts it in near-identical terms. A common rulebook “loses much of its value if Member States add different national requirements on top of it”. The aim, she says, must be “a genuinely European payments market, not 27 national markets”.

That message is welcome to challengers such as Jet Bank, whose economics depend on serving many countries from one licence rather than rebuilding compliance at every border.

As Cristea puts it, a digital bank “should not need to become five different banks to operate in five different Member States”.

The next frontier is data. Under the proposed Financial Data Access framework, open banking would widen into open finance, letting customers share a fuller picture of their financial lives with providers they choose.

Salla sees the appeal for newcomers. A single platform could give a customer one overview of a mortgage, current account and investments held at three different banks. For smaller providers, she says, this “can lower barriers to entry”.

The catch is price. If access to data is sold expensively, Cristea warns, “smaller companies will not be able to afford it, and a law meant to open the market will end up protecting the biggest players”. His principle is simple: “Data should follow the consumer, not the institution that happens to hold it.”

For a challenger, identity is just as decisive. A branchless bank lives or dies by how quickly and cheaply it can verify customers remotely – and how far that verification travels across borders.

Portable digital identity

Here the EU’s digital identity wallet is meant to help, promising portable, cross-border verification. Cristea sees the prize, but also a gap. Wallets must exist by the end of 2026, yet banks need only accept them from the end of 2027.

“A European identity is not much use until people can actually use it,” he says, “and it has to work the same way everywhere.” Salla is more sceptical still, doubting that “fully functional and widely used wallets” will be live across all member states by end-2026.

She flags a longer shadow, too. Quantum computing “could fundamentally challenge the cryptographic systems we rely on today”, she says, urging Europe to prepare now for post-quantum security.

For Albania, the question is how a candidate country plugs into all this before it joins. Its banks already sit inside Europe’s single payments area, which it entered in October 2025 alongside Moldova, Montenegro and North Macedonia.

Align rule, earn trust

Meka argues the sector is ready. Albanian banking, he says, is “the most harmonised” part of the economy with EU standards, and “really well positioned” to absorb SEPA, supervisory convergence and open banking.

Cristea sees a sequence: “align the rules, earn supervisory trust, then open access.” Payments came first; open banking and digital identity should follow, “each opened as the conditions are met, without waiting for accession day”.

The obstacle, he says, “is trust, not technology”. Albanian banks do not yet enjoy the passporting rights that let banks licensed inside the single market operate across it. The closer supervision and anti-money laundering standards align, the stronger the case.

Salla urges caution on sequencing. The EU must “make the Single Market work properly within the Union” before extending its framework outward, she argues. The aim should be “one coherent European market”, not a fragmented one stretched over more countries.

Yet the direction of travel favours the challengers. Meka points to Jet Bank as evidence that Albania can grow home-grown digital banks with “real opportunities for growing regionally” – provided policy makes innovation and digitalisation a genuine public priority.

That means investment in skills, cybersecurity and venture capital. The gaps are real: Meka flags shortfalls in digital literacy and consumer trust, and skills shortages in cybersecurity, data analytics and AI.

Digital champion?

But Albania is, on his telling, a digital “champion” in e-government, with more than 95 per cent of public services delivered through its e-Albania platform – a foundation few peers can match.

For now, Jet Bank is the test case. If a branchless bank can thrive in a cash economy and then reach across borders, it will owe as much to Brussels as to Tirana.

As Cristea puts it, the Western Balkans “should not have to wait for membership to benefit from Europe’s digital financial transformation”.

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