According to the statistics of the National Bank, as of 1Q25, the amount of money in current and demand deposit accounts of retail clients of the bank has decreased. The share is 6.7% (2024 – 10%).According to the NBG's interactive statistics, the annual growth of foreign currency deposits is 18.9% and has maintained an upward trend in the last 3 months (05/2025 +18.2Y.Y; 04.2025 – 16.6%Y.Y).

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The strategy aims to improve access to information about the NBG’s vision, priorities, and plans in the area of consumer protection for the public and all interested stakeholders. It also supports more effective planning of supervisory activities and enhances financial institutions’ awareness of upcoming initiatives.The document outlines key priorities and strategic directions for market conduct supervision, along with evaluation indicators and a monitoring framework.In particular, the strategy reinforces principle-based supervision in consumer protection. This shift moves beyond passive assessments of compliance with legal requirements toward identifying current and emerging risks and challenges and addressing them through proactive supervisory actions and practical solutions.As part of a more consumer-focused approach, thematic inspections will be conducted. These will help better highlight sector-specific challenges and identify areas for improvement.In addition, to support the development of a sustainable and healthy market environment beyond the existing regulatory framework, the National Bank will issue guidelines and recommendations. These tools will promote fair competition and better safeguard consumer interests.The strategy also places greater emphasis on encouraging financial institutions to adopt approaches tailored to different consumer segments.The Market Conduct Supervision Strategy will be reviewed and updated every three years. Priority areas will be reassessed, and changes introduced as needed in response to evolving challenges.

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The investment firm notes that the trend observed over recent months has remained stable: exports remain strong, largely due to re-exports of vehicles, while import growth remains weak, partly because of a decline in car imports.Remittance flows also showed positive momentum, increasing by 12.2% year-over-year in June. Meanwhile, tourism revenues grew 5% annually in the second quarter, up from 2.3% in the first quarter, despite short-term disruptions from the conflict in the Middle East.The European Union remained the largest source of foreign exchange inflows, accounting for 20.3% of total inflows in Q2, although slightly down from 21.7% in Q1.“As we’ve emphasized in previous reports, strong net foreign exchange inflows are one of the three key factors supporting the GEL (Georgian lari),” TBC Capital said.“Of the remaining two, the US dollar has strengthened slightly following the US-EU preliminary trade agreement, while the GEL deposit conversion dynamics in July present a more mixed picture.”Despite this, pressure for GEL appreciation remains strong, as reflected by the National Bank of Georgia’s (NBG) ongoing foreign exchange interventions. According to TBC Capital estimates, the NBG purchased more US dollars in July than in previous months, indicating significant foreign currency inflows.TBC Capital’s short- and long-term exchange rate models suggest that the GEL remains slightly undervalued compared to its equilibrium level.As of June, annual inflation reached 4.0%, showing a moderate acceleration from the previous month but remaining broadly in line with expectations. Food prices remain the primary driver of inflation, although service inflation was also elevated in June.It’s worth noting that the temporary effect of reduced internet fees, which had helped lower inflation by around 0.4 percentage points, is expected to expire in July and August.“If inflationary pressures intensify, which is not our base-case scenario, the excess of foreign currency in the economy would likely contribute to further appreciation of the GEL,” the review states.At its July 30 meeting, the NBG opted to keep the refinancing rate unchanged at 8%, citing a balance of risks.According to TBC Capital, non-cash spending remained stable across June and July, after three months of consecutive growth. This contributed to a slowdown in annual spending growth. Migrant and non-resident spending showed similar dynamics, with non-resident expenditures, a key real-time indicator of tourism, improving in July.Based on preliminary estimates from Geostat, Georgia’s economic growth in June was 6.3%, with an average of 7.1% for Q2.

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In total, in the first half of the year (H1/2025) it was 357 million GEL (H1/2024 – GEL 350 million. +2%Y.Y).According to the statistics of the National Bank of Georgia, conversion operating income in the TOP-10 with large assets increased to Cartu, Liberty, Credo and Bank of Georgia, while decreased to TBC, ProCredit and Basisbank.The consolidated figure also includes the trading of digital and microbanks. As of H1/2025, the largest amount, 322,000 GEL, falls on Paysera. Pave and MBC earned 150,000-150,000 GEL. Crystal has a loss of up to 3 million.Banks with profits from buying and selling currencies

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"Crystal" is the first microbank to join the Association," said Aleko Dzneladze, President of the Association. The banking lobby unites 14 members, including the digital Paysera Bank. The microbank market is currently represented by only 2 entities. The second, which preceded Crystal in obtaining a microbank license, is MBC. And the second microbank is expected to become a member of BAG."On behalf of the Association and the entire sector, we welcome Crystal as an organization with unique experience. Crystal will enrich the Association with experience in supporting micro and small entrepreneurs and their economic inclusion, experience in working with regions, and high corporate social responsibility. At the same time, by sharing the sector's experience, it will receive significant support from the Association in the implementation of banking processes, practices, and systems," noted Aleksandre Dzneladze, President of the Banking Association.

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As a result of the cancellation, the number of ordinary shares with voting rights in the group was determined at 36,537,357 (with an additional 30,000 shares in treasury).The program was approved by the Board of Directors in early July, increasing the previous USD 50 million share buyback and cancellation program by USD 18 million.The maximum price paid per share under the program shall not exceed the most recently published net asset value per share (NAV per share).The increase in the program represents the culmination of GCAP’s previously announced intention to allocate GEL 300 million for capital return by the end of 2026, a significant advance on this target.The 2025 Annual General Meeting (AGM) has approved a maximum of 5,233,275 shares to be repurchased. The program has been extended for three months, until October 2, 2025.

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As of June 2025, the overall price level in Georgia increased by 4% year-on-year. The moderate increase in inflation compared to the target level of 3% is mainly driven by rising food prices. This partly reflects developments in international food markets and the base effect from last year's low inflation. Notably, inflation expectations remain stable. Service sector inflation, which tends to be stickier and reflects long-term inflation expectations remained below the 3% target, stood at 2.3%. Core inflation has also remained below the target level for nearly two years. In parallel, prices for imported products are deflationary, mainly driven by reduced fuel prices year-over-year. According to the NBG’s central scenario, consistent with the previous quarter’s forecast, inflation in 2025 is expected to temporarily exceed the 3% target, averaging around 3.8%. This outlook largely reflects international developments and base effects from the previous year. Over the medium term, it is expected to stabilize around the 3% target.Economic activity remains robust. According to the preliminary data, average economic growth for the first five months of the year stood at 8.8%. This performance is largely supported by the enhanced productive capacity of the economy, which helps mitigate inflationary pressures stemming from excess aggregate demand. Given the gradual normalization of fundamental factors alongside strong growth in the first five months, the NBG’s central scenario has revised the 2025 growth forecast upward, from 6.7% to 7.4%.Global economic uncertainty remains elevated in the light of ongoing geopolitical tensions. As a result, inflation is subject to considerable risks on both the upside and downside. Accordingly, the Monetary Policy Committee considered both high-inflation and low-inflation risk scenarios. On the one hand, the US tariff policy has been revised several times, the re-escalation of which could significantly exacerbate fragmentation in the global economy. This would lead to disruptions in global supply chains, which would create a stagflationary environment. Similarly, intensified geopolitical tension in the Middle East would elevate regional risk and increase pressure on global oil markets adding to supply‑side inflationary pressures. At the same time, trends in the local economy are noteworthy. In particular, inflationary pressures stemming from strong aggregate demand. The realization of these risks require a higher interest rate path compared to the central scenario.On the other hand, the Monetary Policy Committee considered a low-inflation risk scenario, where the realization of the risks would shape the development of fundamental factors in a way that requires a lower trajectory of the monetary policy rate compared to the central scenario. In particular, against the background of structural changes in the economy, productivity remains at a relatively high level. The scenario also assumes a globally weakened U.S. dollar index (DXY) and a rapid normalization of international food commodity prices. If these tendencies persist, a strengthened exchange rate combined with stable international food commodity prices is expected to exert downward pressure on headline inflation through lower imported inflation.As a result of macroeconomic analysis and the assessment of existing risks, the Monetary Policy Committee has considered it optimal to adopt a cautious approach toward further normalizing the monetary policy rate, keeping it unchanged at 8%. Upcoming decisions on the monetary policy rate will depend on updated macroeconomic forecast scenarios and risk assessments.The NBG will use all available instruments to maintain price stability. This means keeping the overall price level increase close to the 3% target over the medium term.The next meeting of the Monetary Policy Committee will be held on September 10, 2025.

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In the last reporting month, 385 loans equivalent to 92 million GEL were issued in USD and EUR (06/2024 – 72 million, 250 loans). The share of foreign currency mortgages in issuances has increased to 23.5% (L/m – 20.5%).Mortgages have become more expensive, both in GEL and in USD and EUR. In the national currency, last year they were issued at 11.6% in GEL, this year it is 13.1%. The annual interest rate on mortgages was set at 7.1% last year, and 8.4% this year.According to commercial banks, the minimum effective rate for a GEL mortgage loan is 15.5%, 10% in USD, and 8.9% in EUR.The mortgage loan portfolio, as of H1/2025, is GEL 12.5 billion, including GEL 4.1 billion denominated in foreign currency.More than half of the portfolio is long-term loans. The short-term mortgage portfolio is GEL 10 billion. Including GEL 2.9 billion equivalent are foreign currency loans.GEL mortgages are issued for a medium term of 10-years. From the fall of 2022, foreign currency will be reduced to 10 years (from the fall of 2022, the maximum mortgage term was reduced from 15 to 10 years).With the summer regulation of the same year, a +3% corridor was opened for both foreign currency and lari mortgages, although foreign currency mortgages were more severely affected.The 3% corridor provides for a +3% assessment of the borrower's solvency when issuing a variable-rate loan (most foreign currency mortgages issued are a mix of variable and fixed). This means that if the rate increases by 1, 2 or 3%, the mortgagee should not have any problems servicing the loan.

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The event was opened by Giorgi Goguadze, Head of the NBG’s Department for Supervision of Payment Service Providers and Registration of Virtual Asset Service Providers. He shared the regulator’s vision for the development of financial technologies in Georgia and highlighted recent initiatives undertaken by the National Bank of Georgia in the fintech space.Vasil Shengelia, Head of the Open Banking Facilitation and Credit Data Management Supervision Division at the NBG’s Financial and Supervisory Technologies Development Department, presented Georgia’s Fintech Development Strategy.The strategy aims to establish a unified national framework that enhances collaboration between relevant public and private stakeholders both domestically and internationally to support the development of an inclusive and innovative fintech ecosystem.One of the strategy’s key goals is to position Georgia as a regional fintech hub for countries along the Middle Corridor. To achieve this, the National Bank of Georgia is actively engaging with regional counterparts.Participants representing member and partner organizations of the Fintech Association discussed the current state of the fintech market in Georgia and globally, recent sectoral advancements, and key regulatory developments. The discussions also emphasized the strategic importance of international cooperation, innovation, and inclusive financial development.The event was attended by representatives of approximately 30 fintech companies, along with partner organizations and key stakeholders from across the sector.

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In particular, the share of foreign currency loans in GEL 30 billion portfolio of resident legal entities has not yet exceeded 60%. The dollarization ratio is 63.7%.The share of foreign currency-denominated loans in retail does not exceed 24%, although the dollarization ratio has increased by 0.2 percentage points.The larization ratio of total loans has also decreased to 56.9% (L/m - 57.13%; L/Y - 57.3%).As the National Bank of Georgia has announced, the next restriction on foreign currency lending (from August 1, the limit is increasing to 750,000 GEL), according to the regulator's expectations, the new limit should reduce foreign currency lending by $150 million. The previous round (increasing to 500,000) was designed to reduce annual issuance by more than $100 million, and the previous one (400,000) was designed to reduce it by $180 million.

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