Regulation on the access of non-bank payment service providers to payment systems

1

Pursuant to Article 36, paragraph 1, sub-paragraph 1.1 and Article 65, paragraphs l and 2, of Law No. 03/L-209 on the Central Bank of the Republic of Kosovo, (Official Gazette of the Republic of Kosovo, No. 77/16 August 2010), amended and supplemented by Law No. 05/L -150 (Official Gazette of the Republic of Kosovo No. 10/3 April 2017), Article 94, paragraph 4 and Article 114 of Law No. 04/L-093 on Banks, Microfinance Institutions and Non-Bank Financial Institutions (Official Gazette of the Republic of Kosovo S/ No. 11 / 11 May 2012, Pristina) Article 8, paragraph 1, subparagraph 1.1, and paragraph 2, sub-paragraph 2.3, of Law No. 04/L-155 on Payment System (Official Gazette of the Republic of Kosovo No. 12/3 May 2013), and Article 136 of Law No. 10/L-026 on Payment Services (Official Gazette of the Republic of Kosovo, No.10 / 14 May 2026), the Board of the Central Bank of the Republic of Kosovo, at the meeting held on June 29, 2026, approved the following: REGULATION ON THE ACCESS OF NON-BANK PAYMENT SERVICE PROVIDERS TO PAYMENT SYSTEMS Article 1 Purpose and Scope

1. The purpose of this Regulation is to determine the conditions, criteria, requirements and procedures for approval of the access of non-bank Payment Service Providers (hereinafter NB￾PSPs) to interbank payment systems operated and supervised by the Central Bank of the Republic of Kosovo (hereinafter CBK).
2. The qualification of NB-PSPs for access to payment systems operated by the CBK aims to increase the efficiency, competition and functioning of the payments sector, including, but not limited to, facilitating the provision of payments throughout the territory of the Republic of Kosovo.
3. This regulation applies to all payment service providers.

2 Article 2 Definitions

1. All terms in this Regulation have the same meaning as the terms defined in the Law on Payment Systems, the Law on Payment Services and/or defined below for the purposes of this Regulation: 1.1. Payment institution - means a legal person that has been granted authorization in accordance with Article 14 of the Law on Payment Services to provide and execute payment services in Kosovo; 1.2. Electronic money institutions - means a legal person that has been granted authorization from CBK to issue electronic money; 1.3. Safeguarding account – means a separate account in a credit institution or in the CBK, by a non-bank payment service provider that is used to separate and protect the funds of their clients from its own funds; 1.4. Payment service provider – means a natural or legal person providing payment services (e.g. issuing, acquiring, the authorization of transactions, the authentication of end users) enabling the transfer of value between end users. (Banks, Electronic Money Institutions, Payment Institutions, Postal Institutions, CBK, Central Public Authorities) 1.5. Non-bank payment service provider (Non-bank PSP) – means a non-bank financial institution licensed and authorized by the CBK to provide payment services and/or issue electronic money pursuant to the Law on Payment Services. This definition includes payment institutions and electronic money institutions; 1.6. Ancillary system – means a system through which the exchange and/or clearing of payments or securities is carried out, while the final settlement of monetary obligations arising from these transactions is carried out in another system, usually in an RTGS system; 1.7. KIPS (Kosovo Interbank Payment System) means the Interbank Payment System in the Republic of Kosovo. 1.8. TIPS Clone – a fast payment system that enables payment service providers to offer funds transfers to their customers in real time and around the clock, every day of the year; 1.9. RTGS – means the real-time gross settlement system of large and urgent payments, operated by CBK, an integral part of the KIPS; 1.10. ACH – means the automatic interbank clearing system for small amounts carried out by sessions on a net basis, operated by CBK, an integral part of the KIPS;

3 1.11. Maximum holding amounts – refers to the highest limit of funds that a NB-PSPs may hold in the account opened with the CBK or in payment systems operated or supervised by the CBK; 1.12. PSD – Payment Systems Department at the CBK; 1.13. End of business day – means the cut-off time, as defined for in the rules of the payment system operated by the CBK for the settlement of payment orders for that business day; 1.14. Payment System Operator – means the Central Bank of the Republic of Kosovo, as the entity responsible for the operation and/or administration of a payment, clearing or settlement system for securities/or another operator licensed and supervised by the CBK; 1.15. Payment system or System- a system where two or more participants cooperate to enable payments to be effected or to facilitate the circulation of money and includes any arrangement and/or procedures for processing, exchange, clearing, netting and/or settlement of payment transactions. This term includes exchanges for payment instruments; 1.16. Payment Services - means any of the following business activities: 1.16.1. Services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account 1.16.2. Services enabling cash withdrawals from a payment account as well as all the operations required for operating a payment account 1.16.3. Execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider 1.16.4. Execution of payment transactions where the funds are covered by a credit line for a payment service user 1.16.5. Issuing of payment instruments and/or acquiring of payment transactions; 1.16.6. Money remittance; 1.16.7. Payment initiation services; 1.16.8. Account information services. 1.17. Direct participant –means a direct participant in a payment system is a party that instructs, clears and settles payments on its own behalf; 1.18. Direct participant-sponsor - is a direct participant that acts as an intermediary and is responsible for clearing and settling transactions of indirect participants in the payment system, under a sponsorship agreement.

4 1.19. Indirect participant –means the indirect participants that rely on a direct participant both operationally and commercially for the clearing and settling of transactions of the indirect participant. Article 3 Types of access to the payment system operated by the CBK and Obligations of Participants 1.The CBK payment system shall provide two types of access for participation: direct participation and indirect participation. 1.1. Direct Participation 1.1.1 Direct participants are entities bound by the rules and agreements of the CBK payment system, which instruct, clear, and settle payments on their own behalf. 1.1.2 Direct participants may also act as intermediaries or sponsors for NB-PSPs or other entities that do not, or choose not to, participate directly. 1.1.3 For systems settling in CBK, direct participants shall hold a central bank settlement account and connect directly to the RTGS system. Such accounts may provide intraday liquidity and facilities to ensure efficient and sustainable clearing and settlement systems. 1.1.4 Categories of direct participants shall include, but not be limited to: 1.1.4.1.CBK; 1.1.4.2.Commercial Banks, which may receive intraday liquidity facilities (ILF) from CBK on a collateralized basis; 1.1.4.3.Treasury/Ministry of Finance, Labor and Transfers; 1.1.4.4.Public funds established by law and which are not serviced by commercial banks. 1.1.4.5. NB-PSPs, which are eligible for direct participation but not for ILF support; 1.1.4.6.Payment systems operators licensed by CBK such as ACH, TIPS clone, as well as other payment systems). 1.2 Indirect Participation 1.2.1 Indirect participants are entities whose transactions are cleared, settled, or recorded by or through a direct participant, without being directly bound by the CBK payment system rules; 1.2.2 Indirect participation shall be established through a sponsorship agreement with a direct participant. A copy of the agreement must be submitted to CBK for approval;

5 1.2.3 The sponsor direct participant shall remain fully liable for the settlement of transactions submitted by the indirect participant; 1.2.4 Indirect participants may submit transactions; 1.2.4.1 through their sponsor direct participant, or 1.2.4.2 directly to the CBK system, in which case they must comply with CBK technical and messaging standards of the payment systems. 1.2.5 CBK may require direct participants to maintain separate reserve sub-accounts for each indirect participant in order to ensure efficient monitoring and settlement; 1.2.6 Direct participants shall remain eligible to access ILF for settling both their own and their indirect participants transactions, on a collateralized basis; 1.2.7 CBK may limit the number of indirect participants per direct participant in order to mitigate credit, liquidity, and concentration risks; 1.2.8 CBK reserves the right to require an indirect participant to become a direct participant where the volume or value of its transactions justifies such participation. 1.3 Obligations of Direct Participants Acting as Sponsors 1.3.1 Direct participants shall apply transparent, fair, and risk-based criteria when offering sponsorship services to indirect participants; 1.3.2 Direct participants shall disclose sufficient information of their services to enable indirect participants to make clear and meaningful comparisons; 1.3.3 Direct participants shall not require indirect participants to disclose commercially sensitive information regarding their payment services or business models, except when reasonably required for the fulfillment of legal obligations, in accordance with legislation on the prevention of money laundering and countering the financing of terrorism (AML/CFT); 1.3.4 The termination of a sponsorship agreement by a direct participant shall be subject to sufficient prior notice and must be reported to CBK; 1.3.5 Where an indirect participant terminates its /sponsorship agreement, it shall duly notify both its direct sponsoring participant and the CBK. Article 4 Access to the Payment System Operated by the CBK

1. The CBK, on request from NB-PSPs, shall approve direct access to payment systems, if the same has met the following requirements: 1.1 To be authorized and supervised by the CBK for the respective payment services; 1.2 An NB-PSPs (or a third party performing these functions, for whose actions and omissions the PSP remains fully responsible) shall install, manage, operate, monitor, and ensure the protection of the relevant IT infrastructure required to connect to the payment systems, and shall have the capability to initiate payment transfers;

6 1.3 Provide any supporting information that the CBK deems necessary to make a decision regarding the application for access to the payment systems operated by the CBK; 1.4 Implement appropriate security measures to protect its systems from unauthorized access and use, including aspects related to cyber resilience and information security; 1.5 A NB-PSP applying for access to the payment systems shall submit to the CBK a declaration issued by the competent management body of the NB-PSP, confirming its compliance with the conditions for requesting participation as defined in Article 5 of this Regulation. 2. The CBK shall assess the compliance of the NB-PSP in accordance with the requirements of Article 5 of this Regulation, following the procedures set out in Article 6. 3. Each NB-PSP granted access to the payment systems operated and supervised by the CBK shall submit to the CBK, once a year from the date of approval of access to the payment systems, a declaration signed by its competent management body confirming the continued compliance of the NB-PSP with the requirements set out in subparagraphs 1.4 and 1.5 of this Article. The CBK shall verify the information provided in such a declaration and may request any supporting documentation it deems necessary for verification purposes.

Article 5 Conditions for participation in payment systems

1. NB-PSPs requesting participation or participate in systems designated under the Law on Payment System shall have in place the following: 1.1 a description of the measures taken for safeguarding payment service users’ funds; 1.2 a description of the governance arrangements and internal control mechanisms for the payment services or electronic money services it intends to provide, including administrative, risk management and accounting procedures of NB-PSPs and a description of the arrangements for the use of information and communication technology services of the NB-PSP, related to Regulation on information systems and cyber risk management and Regulation on information and communication technologies-ICT and security risk management; 1.3 a winding-up plan in case of failure.
2. The measures for protecting the funds of payment service users under subparagraph 1.1 of paragraph 1 of this article must contain: 2.1 where the NB-PSP safeguards payment service users’ funds by depositing funds in a separate account in a bank or by means of an investment in secure, liquid, low-risk assets as defined by the CBK, the description of the measures taken for such safeguarding shall contain, as applicable: 2.1.1 a description of the investment policy to ensure that the assets that are chosen are liquid, secure and low-risk; 2.1.2 the number of persons that have access to the safeguarding account and their functions; 2.1.3 a description of the administration and reconciliation process to ensure that payment service users’ funds are insulated in the interest of payment service

7 users against the claims of other creditors of the NB-PSPs, in particular in the event of insolvency; 2.1.4 a copy of the draft contract with the bank; 2.1.5 an explicit declaration by the NB-PSP of compliance with Article 11 of the Law on Payment Services. 2.2 where the NB-PSP safeguards payment service users’ funds through an insurance policy or comparable guarantee from an insurance company or a bank, the description of the measures taken for such safeguarding shall contain the following: 2.2.1 confirmation that the insurance policy or comparable guarantee from an insurance company or a bank is from an entity that is not part of the same group of firms as the NB-PSP; 2.2.2 details of the reconciliation process in place to ensure that the insurance policy or comparable guarantee is sufficient to meet the safeguarding obligations of the NB-PSP; 2.2.3 the duration and the terms of renewal of the coverage; 2.2.4 a copy of the contract or its draft. 3. Governance and internal control measures under subparagraph 1.2 of paragraph 1 of this article must be proportionate, appropriate, adequate, and include: 3.1 a mapping of the risks identified by the payment institution or electronic money institution, including the type of risks and the procedures the NB-PSP has in place or will put in place to assess and prevent such risks; 3.2 the different procedures to carry out periodical and permanent controls, including the frequency and the human resources allocated; 3.3 the accounting procedures by which the NB-PSP records and reports its financial information; 3.4 the identity of the person or persons responsible for the internal control functions, including for periodic, permanent and compliance control, as well as an up-to-date curriculum vitae of that person or those persons; 3.5 the identity of the auditors as described and defined in the secondary legislation of the CBK 3.6 the composition of the management body and, if applicable, of any other oversight body or committee; 3.7 a description of the way outsourced functions are monitored and controlled to avoid impairment of the quality of the internal controls of the payment institution or electronic money institution; 3.8 a description of the way any agents and branches are monitored and controlled within the framework of the internal controls; 3.9 where the NB-PSP is the subsidiary of a regulated entity in another country, a description of the group governance. 4. For the purposes of subparagraph 1.3 of paragraph 1 of the winding-up plan shall be adapted to the envisaged size and business model of NB-PSP and shall include a description of the mitigation measures to be adopted by the NB-PSP in the event of the termination of its payment services, which would ensure the execution of pending payment transactions and the termination of existing contracts.

8 Article 6 Application Procedure

1. NB-PSP PSPs expressing interest in direct access to payment systems must apply in writing to the CBK. The application must contain the following information: 1.1 Request for participation in the Interbank Payment System – KIPS (annex 1); 1.2 Evidence of authorization from the CBK, as a payment service provider; 1.3 Statement on operational capacity; 1.4 Risk management policies; 1.5 IT security and business continuity measures; 1.6 Evidence regarding the fulfillment of the conditions set forth in Article 5 of this Regulation.
2. During the application evaluation process, as necessary, the CBK may request additional documents necessary for evaluation, as well as initiate on-site visits-inspections, in order to verify compliance with the participation criteria.
3. The CBK, based on the assessment of the application according to the requirements provided for in this article, within 45 days from the receipt of the completed application, approves or rejects the access, providing the relevant justifications. Article 7 Procedure for the access of new institutions in the interbank payment system - KIPS
4. The CBK determines the steps and criteria for the inclusion of authorized non-bank institutions in the CBK interbank payment system (KIPS), ensuring compliance with technical, operational and regulatory requirements.
5. For access to ancillary systems, NB-PSPs must first be participants in KIPS, from where they must meet the technical rules for access to those systems.
6. The process of granting access for a new institution to KIPS is divided into four mandatory and consecutive stages, as follows: 3.1 Phase I – Education and Initial Information Exchange 3.1.1 The interested institution notifies the CBK in writing of its intention to become a direct participant in KIPS; 3.1.2 The CBK shall provide an official response to the institution, providing information on the structure, functionality and rules of the KIPS system, as well as the technical and operational requirements for participation; 3.1.3 The CBK organizes an information meeting with senior managers representatives of the applicant institution, with the aim of clarifying any ambiguities or open issues regarding the participation requirements. 3.2 Phase II – Commitment and Formal Application 3.2.1 The applicant institution submits an official request to the PSD at the CBK for participation in the KIPS, signed by the competent governing body;

9 3.2.2 The request must be accompanied by the relevant documentation according to Article 6 of this Regulation. 3.3 Phase III – Risk and Suitability Assessment for Access 3.3.1 The CBK conducts a detailed risk assessment process for the applicant institution, through its relevant sectors. 3.3.2 The assessment is based on: 3.3.2.1 Information and documentation submitted by the institution; 3.3.2.2 Official and reliable sources available to the CBK. 3.3.3 The CBK assesses the level of risk exposure and determines the suitability of the institution based on the criteria set out in Article 6 of this Regulation, as well as by applying the standardized risk assessment methodologies that it will develop in the future. 3.3.4 Based on the results of the risk assessment and compliance with the above criteria, it is determined whether the institution is granted the right to access KIPS; 3.3.5 Depending on the level of risk identified, the frequency of review and monitoring of the institution is also determined. 3.4 Phase IV – Technical and Operational Implementation 3.4.1 After approval of the application, the institution moves to the technical and operational implementation phase, to achieve full integration with the KIPS system. 3.4.2 The CBK sets a maximum deadline of 3 (three) months for the successful completion of this phase, which includes: 3.4.2.1 Full testing of the technological connection to KIPS, compliance with communication standards (e.g. use of ISO 20022 messages), as well as the security of the institution's systems and equipment; conducting functional tests, load tests and disaster recovery scenarios; 3.4.2.2 Signing the agreement/ letter of consent for participation in KIPS; 3.4.2.3 Training of staff responsible for the operation and maintenance of systems in accordance with CBK requirements. 3.4.3 If the institution fails to successfully complete the implementation phase within the specified deadline, it will be automatically suspended from the process for a period of 3 (three) months. After this period, the institution may resubmit a request to resume the procedure. 4. The institution may begin operating as a direct participant in KIPS only upon receiving the CBK’s official notification of operational activation.

10 Article 8 Access to ancillary systems The participation of a NB-PSPs in ancillary systems requires that the entity be a participant in the KIPS system and adapts to the specific conditions of the relevant system itself. These conditions include technical, operational and regulatory requirements, which may vary depending on the nature and functionality of the system. As such, participation in these systems is not automatic, but depends on a detailed assessment of suitability and compliance with the rules and standards of the relevant system. Article 9 Obligations to participate in payment systems and restrictions on access

1. NB-PSPs with authorized access shall be obliged to: 1.1. To implement and respect the rules of payment systems; 1.2. Maintain adequate measures for the integrity and security of transactions and user access within the relevant institutions; 1.3. Submit periodic reports as required by the CBK; 1.4. To allow the CBK's supervisory activities as appropriate; 1.5. To access payment systems at any time during the operating day, respecting the systems' working hours; 1.6. Allow only authorized personnel to operate in payment systems; 1.7. To draft internal procedures for system security and protection, including organizational procedures (human resources and computer equipment), in accordance with the legal framework of the CBK; 1.8. To immediately report to the CBK any observed or suspected irregularities in the security of payment systems; 1.9. To maintain records of payment transactions in hard copy and/or electronic format depending on the method by which the payment transactions were initiated, for a period of not less than five (5) years, according to accounting standards and rules in force 1.10. To prepare a contingency plan, that ensures the timely execution of daily operations in the unforeseen circumstances.
2. The CBK may temporarily restrict a participant in payment systems when the participant is unable to execute settlement requests. During this restriction, the participant has access to the system but cannot make payments with other participants. The restriction is lifted when the necessary funds are provided in its settlement account, and the CBK shall immediately notify the participants through an official channel.
3. The CBK may suspend a participant's access to payment systems in cases where the participant fails to provide the necessary funds for settlement, endangers financial stability or violates the requirements of the regulation. The suspension shall be notified by official channels and shall include the immediate freezing of its accounts. The CBK shall not be liable for any possible losses, and the suspension shall be lifted when the relevant conditions are met.
4. The CBK may exclude a participant from the payment systems in cases such as:

11 4.1 written request from the participant himself; 4.2 merger with other participants; 4.3 failure to replenish funds after suspension; 4.4 failure to comply with the secondary legislation; 4.5 placement in liquidation and revocation of the license, or non-use of the systems for 12 months. 5. The decision to exclude is communicated to the participant, and the CBK closes his account in RTGS. Article 10 Accounts in the CBK operated payment systems and non-offering of safeguarding accounts

1. For the purposes of settling payment orders, NB-PSPs will be allowed to open a settlement account in the RTGS module of the KIPS system, through which the settlement of payments from all other ancillary systems is carried out.
2. The account held by the NB-PSP in RTGS will be used only for the settlement of payment orders. This account will also provide liquidity for the settlement of payments in ancillary systems (retail payment systems, such as ACH, TIPS Clone, etc.), systems in which participants must open sub-accounts.
3. Based on the Law on the CBK, in order to manage liquidity, the CBK provides intraday or overnight loan support only to banks, but not to NB-PSPs.
4. For the purposes of this article accounts provided for the purpose of settling payment orders in payment systems shall not be considered as safeguarding accounts
5. Compensation for funds held in accounts of NB-PSPs in payment systems operated by the CBK shall be in accordance with applicable legislation. Article 11 Maximum holding amounts in accounts by NB-PSPs
6. The amounts of funds held at the end of the business day by an NB-PSP in all accounts in payment systems shall not exceed the maximum holding amount applicable to the payment systems.
7. The maximum amount that a NB-PSP may hold in an account is set to ensure that this account is used only for settlement purposes and not as a deposit. This measure helps; 2.1 to prevent the diversion of funds from the banking sector; 2.2 to prevent scenarios where NB-PSPs benefit from the benefits of holding funds with the CBK without being subject to the same regulatory requirements as banks (such as regulatory capital or liquidity requirements); and, 2.3 to maintain fair competition between banks and non-bank institutions.
8. The funds referred to in paragraph 1 of this Article include funds held at the end of the business day by NB-PSPs in the following accounts in the CBK payment systems, including: 3.1 Settlement account which is used to hold funds for the settlement of payments between participants in the system; 3.2 Sub-accounts in ancillary systems, (small value payment systems (ACH, TIPS clone, etc.).

12 4. The maximum holding amount referred to in paragraph 1 of this article shall be calculated as follows: 4.1 Where the NB-PSP has been in operation for a period of 12 months prior to its application for access to a CBK operated payment system, the maximum holding amount shall be twice the peak value of the outgoing cash transfer orders including, where relevant, ancillary system transfer orders but excluding liquidity transfers and the NB-PSP’s own funds on any business day during the previous 12-calendar-month period. The NB-PSP shall include the detailed calculation of such maximum holding amount in its application to the CBK to participate in the payment system. 4.2 Where the NB-PSP has not been in operation for a period of 12 months prior to its application for access to a CBK operated payment system, the maximum holding amount shall be twice the NB-PSP’s expected total peak value of the outgoing cash transfer orders including, where relevant, ancillary system transfer orders but excluding liquidity transfers and the NB-PSP’s own funds. The NB-PSP shall include its detailed calculation of the proposed maximum holding amount in its application to participate in the CBK operated payment system. 4.3 In the 12-month period following the opening of the first active account in the CBK operated payment system, CBK shall recalculate the maximum holding amount for each NB-PSP each month during the first quarter, and thereafter, each quarter. Such recalculated maximum holding amount shall apply from the next business day after recalculation is notified to each NB-PSP by the CBK and until the next recalculation. 4.4 After the first 12-month period following the opening of the first active account in the payment system, CBK recalculates the maximum holding amount once each year. The recalculation shall be based on the NB-PSP’s actual total peak value of all outgoing cash transfer orders including, where relevant, ancillary system transfer orders but excluding excluding liquidity transfers and the NB-PSP’s own funds during the previous 12-month period in the CBK operated payment system. Additionally, the recalculation will be based on the information provided by the NB-PSP in accordance with subparagraphs (4.1) and (4.2) of this article. 4.5 In exceptional circumstances, the CBK may, at its discretion, recalculate the maximum holding amount on an ad-hoc basis, in the event of a significant change in the settlement values of an NB-PSP that is imminent or has already occurred and that might cause non￾compliance with the relevant maximum holding amount. Any such recalculation shall be made in accordance with subparagraph 4.2 of this Article. 5. If the total funds on the NB-PSP’s accounts exceed the applicable maximum holding amount, the NB-PSP shall take immediate steps to reduce those total funds held to an amount below the maximum holding amount. If such a reduction is not possible due to an incoming payment shortly before the end of the business day, the reduction shall take place without undue delay after the start of the next business day. 6. The CBK shall review, as necessary, the types of accounts listed in paragraph 3 of this Article no later than one year after the date on which this Regulation enters into force, and at least every three years thereafter. The CBK shall also review the method for calculating the maximum total amount of maintenance, as defined in paragraph 4 of this Article, no later than one year after the date on which this Regulation enters into force, and at least every three years thereafter.

13 Article 12 Non-compliance with the maximum total holding amount limit or with the requirements for access to payment systems operated and supervised by the CBK

1. In the event that a NB-PSP fails to comply with the requirements of Article 11 of this Regulation, the CBK shall impose a penalty at the rate of 0.03% on the total amount in excess of the maximum holding amount of the account balance that the NB-PSP maintains at the end of the business day in the payment system, as well as an additional daily penalty of EUR 1,000.00 for each day of non-compliance.
2. Where an NB-PSP has not remedied a material non-compliance with the requirements of Article 11 of this Regulation, the CBK may terminate the participation of the NB-PSP in the payment system with prior notice of one month and shall impose an additional one-time penalty of EUR 1,000.00 for each closed account. For the purposes of this paragraph, each of the cases as defined in subparagraphs 2.1 and 2.2 of this paragraph shall be considered, among others, to be an event of material non-compliance: 2.1 systematic or repeated breach of the relevant maximum holding amount limit, including but not limited to breach involving a significant amount in excess of the relevant maximum holding amount limit; 2.2 failure to reduce the amount held on the relevant accounts to below the maximum holding amount by the end of the business day after the business day on which the funds are received.
3. If an NB-PSP no longer complies with the requirements set out in paragraph 1 of Article 4 of this Regulation the CBK may terminate NB-PSP’s participation in payment system without prior notice.
4. If a NB-PSPs fails to comply with the requirements set out in paragraph 3 of Article 4 of this Regulation, the CBK may terminate the participation of the NB-PSPs in the payment system with a prior notice of one month. Article 13 Supervision and Enforcement
5. The CBK shall actively supervise the activities of NB-PSPs to ensure full compliance with the provisions of this Regulation. This includes continuous monitoring of operational practices, adherence to technical and security requirements, and compliance with any reporting obligations established by the CBK.
6. In the event of non-compliance, the CBK reserves the right to take appropriate measures and administrative sanctionsin accordance with Article 17 of this Regulation. These measures shall be taken in a proportionate manner and in accordance with the nature of the breach, where such non-compliance poses a risk to the safety, efficiency or integrity of the payment system.
7. Enforcement actions will be carried out in accordance with the applicable legal and regulatory framework, and NB-PSPs will be given the opportunity to respond to the CBK's findings before measures and administrative sanctions are imposed, except in cases where it is necessary to take immediate measures to protect the system or its participants.

14 Article 14 Fees Fees applicable to NB-PSPs for participation in the CBK payment system shall be determined by the CBK. Article 15 Review and Update This Regulation shall be subject to periodic review at least once every three years, to ensure its continued relevance, effectiveness and compliance with evolving regulatory requirements. In addition to planned reviews, the Regulation may be updated or revised whenever necessary in accordance with changes in applicable legislation, regulatory developments, international standards or emerging best practices in this field. Article 16 Annexes

1. The following Annexes are an integral part of this Regulation: 1.1. Annex 1 – Application for Participation in the Interbank Payment System – KIPS; 1.2. Annex 2 – Letter of Consent for Participation in the Interbank Payment System – KIPS. Article 17 Enforcement, remedial measures and penalties Except for the measures specified in Article 12 of this Regulation in connection with Articles 4 and 11, any violation of the provisions of this Regulation shall be subject to remedial measures and/or civil administrative penalties, as set out in Law No. 03/L-209 on the Central Bank of the Republic of Kosovo, Law No. 04/L-155 on Payment Systems and Law No. 10/L-026 on Payment Services. Article 18 Entry into Force This Regulation shall enter into force 15 days from the date of its approval.

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Dr.sc. Bashkim Nurboja Chairman of the Central Bank of the Republic of Kosovo

15 Annex 1 APPLICATION FOR PARTICIPATION IN THE INTERBANK PAYMENT SYSTEM (KIPS) On behalf of [Applicant Institution], through this application, I hereby declare our institution’s intention to become a direct participant in the Interbank Payment System operated by the Central Bank of the Republic of Kosovo (CBK). [Applicant Institution] acknowledges that the CBK Account Management and Payment Services Policy sets out the technical and procedural requirements for establishing direct participation. We acknowledge that meeting these requirements requires the active involvement of the relevant organizational units within our institution to ensure compliance with the CBK’s requirements and expectations. Throughout the onboarding process, [Applicant Institution] is committed to fostering effective cooperation and the timely exchange of information with the CBK. Both Parties acknowledge that this declaration serves solely as an expression of interest by [Applicant Institution] to pursue direct participation. It does not constitute a legally binding commitment on the part of either [Applicant Institution] or the Central Bank of the Republic of Kosovo. Signature of the Participant: Full Name of the Director: Signature: Date:

16 Annex 2 LETTER OF CONSENT FOR PARTICIPATION IN THE INTERBANK PAYMENT SYSTEM (KIPS) By signing this Letter of Consent, the Participant agrees to the following criteria:

1. The Participant shall comply with and adhere to the KIPS System Rules and the relevant operational guidelines;
2. The Participant acknowledges receipt of a copy of the KIPS System Rules and the Regulation on Access of Non-Bank Payment Service Providers to Payment Systems, and confirms that it has been informed of the instructions for the use of KIPS;
3. The Participant undertakes not to adversely affect the efficiency of KIPS, the integrity of payment transactions sent and received, the settlement of such transactions, or jeopardize the KIPS system;
4. The Participant undertakes to pay the fees and other mandatory charges prescribed under the relevant CBK regulatory framework;
5. The rights and obligations set out in this Letter of Consent apply not only to KIPS, but also to all other Participants that have agreed to comply with and implement the KIPS System Rules, as well as the relevant agreements and instructions;
6. By this document, the Participant authorizes the CBK to administer its accounts held in KIPS for the purpose of ensuring the proper functioning of the system;
7. For the use of the KIPS system, Participants shall complete the following form:

17 To: Payment Systems Department Central Bank of the Republic of Kosovo From: Applicant name: Country: Business Registration Number: Head Office Address: SWIFT BIC: Settlement Account: Contact Person for Payment System operations: Telephone Number: Fax Number: E-mail: Contact Person for IT services: Telephone Number: Fax Number: E-mail: Preferred Start Date: (This is the preferred date from which the Applicant wishes to commence using KIPS.) Signature of the Participant: Full Name of the Director: Signature: Date: