By Vjosa Kika, Head of Regulatory Legal, Zvilo
Building the Foundation for Capital Markets
Kosovo has already recognized the importance of building a modern financial system that supports private-sector growth. Almost a year ago, the Government approved the Concept Document for a comprehensive capital markets legal framework. The next step is drafting and adopting the Law on Capital Markets and the Law on Investment Funds. These two laws will establish the foundation for market infrastructure, supervision, investor protection, and investment vehicles.
While these laws will enable the issuance and trading of traditional securities and the establishment of regulated investment funds, they are only the starting point. To ensure entrepreneurs and small businesses also benefit from this new financial architecture, Kosovo will need additional tools that expand access to capital beyond banks and institutional investors. One of the most effective and timely tools to bridge this gap is crowdfunding.
Kosovo has no shortage of entrepreneurial talent. What remains limited is access to finance, especially for early-stage businesses that are too risky for traditional lending. While we discuss capital markets development, guarantee funds, and foreign investment attraction, we may be overlooking crowdfunding as a practical and scalable tool that many economies already use.
How Crowdfunding Can Expand Access to Finance
Crowdfunding enables businesses to raise capital from a large pool of investors through online investment platforms. These platforms connect entrepreneurs seeking growth with people who want to invest, including retail investors and the diaspora.
Crowdfunding platforms come in different forms. Donation-based and reward-based models are already possible under Kosovo law. A donation-based model functions more like charitable giving, while a reward-based model resembles a pre-purchase of goods. These platforms can operate by using licensed payment service providers and adhering to applicable anti-money-laundering rules and consumer protection requirements.
The real opportunity lies in investment-based crowdfunding. Through lending or equity models, investors can finance startups and receive securities or returns in exchange. This is where access to finance truly expands.
Equity-based crowdfunding in Kosovo will potentially become feasible once the capital markets and investment funds legal framework is adopted, as it involves the public offering and transfer of securities. Once that foundation is in place, equity crowdfunding platforms can operate legally and safely.
Lending-based crowdfunding offers a more immediate opportunity. This model allows entrepreneurs to seek loans from multiple individual lenders via the platform. Each lender contributes a portion of the total loan amount. A few platforms in the region already demonstrate how investment-focused crowdfunding can work in practice. For example, Ventu.rs, developed through USAID assistance, connects startups with individual investors through a structured online process, offering project information, risk indicators and investment terms in a transparent manner. These platforms have grown by leveraging existing legal frameworks on contracts, payment services and company law, even without a dedicated crowdfunding regulation. Their experience shows that demand for such financing exists and that entrepreneurs and small investors are willing to participate when tools are available.
However, as the market grows, so do the risks. To ensure investor confidence and protect both sides of a transaction, investment-based crowdfunding requires clear rules and supervision.
Why Kosovo Should Align with the EU Crowdfunding Model
Investment-based crowdfunding platforms are subject to clear rules in the European Union. The European Crowdfunding Service Providers Regulation (ECSPR) governs how platforms are licensed, how they operate, and how investors are protected. It requires transparent information on financing offers, risk checks for retail investors, secure handling of funds through authorized payment service providers, and full compliance with anti-money-laundering standards.
To enable this safely, Kosovo will need a dedicated law regulating crowdfunding service providers. This law should define the licensing requirements, operational standards, and investor-protection rules for platforms that facilitate investment and lending to businesses. The Central Bank of Kosovo, as the authority responsible for the stability and integrity of the financial sector, would be best positioned to oversee and supervise these platforms. Under CBK’s supervision, crowdfunding could grow in a controlled and trustworthy manner, ensuring that both investors and entrepreneurs are protected as this market evolves.
Kosovo has already taken the first big step by deciding to build capital markets. As the new laws are drafted and adopted, we have an opportunity not to stop there. Crowdfunding can be one of the first real benefits for entrepreneurs, giving them a fair chance to grow their ideas and engage investors more directly, including the diaspora.
The foundation is being built. The opportunity is clear. We should use this momentum to turn legal reforms into real access to finance for Kosovo’s private sector.
Crowdfunding in Kosovo: The Next Step After Capital Markets Legislation
By Vjosa Kika, Head of Regulatory Legal, Zvilo
Building the Foundation for Capital Markets
Kosovo has already recognized the importance of building a modern financial system that supports private-sector growth. Almost a year ago, the Government approved the Concept Document for a comprehensive capital markets legal framework. The next step is drafting and adopting the Law on Capital Markets and the Law on Investment Funds. These two laws will establish the foundation for market infrastructure, supervision, investor protection, and investment vehicles.
While these laws will enable the issuance and trading of traditional securities and the establishment of regulated investment funds, they are only the starting point. To ensure entrepreneurs and small businesses also benefit from this new financial architecture, Kosovo will need additional tools that expand access to capital beyond banks and institutional investors. One of the most effective and timely tools to bridge this gap is crowdfunding.
Kosovo has no shortage of entrepreneurial talent. What remains limited is access to finance, especially for early-stage businesses that are too risky for traditional lending. While we discuss capital markets development, guarantee funds, and foreign investment attraction, we may be overlooking crowdfunding as a practical and scalable tool that many economies already use.
How Crowdfunding Can Expand Access to Finance
Crowdfunding enables businesses to raise capital from a large pool of investors through online investment platforms. These platforms connect entrepreneurs seeking growth with people who want to invest, including retail investors and the diaspora.
Crowdfunding platforms come in different forms. Donation-based and reward-based models are already possible under Kosovo law. A donation-based model functions more like charitable giving, while a reward-based model resembles a pre-purchase of goods. These platforms can operate by using licensed payment service providers and adhering to applicable anti-money-laundering rules and consumer protection requirements.
The real opportunity lies in investment-based crowdfunding. Through lending or equity models, investors can finance startups and receive securities or returns in exchange. This is where access to finance truly expands.
Equity-based crowdfunding in Kosovo will potentially become feasible once the capital markets and investment funds legal framework is adopted, as it involves the public offering and transfer of securities. Once that foundation is in place, equity crowdfunding platforms can operate legally and safely.
Lending-based crowdfunding offers a more immediate opportunity. This model allows entrepreneurs to seek loans from multiple individual lenders via the platform. Each lender contributes a portion of the total loan amount. A few platforms in the region already demonstrate how investment-focused crowdfunding can work in practice. For example, Ventu.rs, developed through USAID assistance, connects startups with individual investors through a structured online process, offering project information, risk indicators and investment terms in a transparent manner. These platforms have grown by leveraging existing legal frameworks on contracts, payment services and company law, even without a dedicated crowdfunding regulation. Their experience shows that demand for such financing exists and that entrepreneurs and small investors are willing to participate when tools are available.
However, as the market grows, so do the risks. To ensure investor confidence and protect both sides of a transaction, investment-based crowdfunding requires clear rules and supervision.
Why Kosovo Should Align with the EU Crowdfunding Model
Investment-based crowdfunding platforms are subject to clear rules in the European Union. The European Crowdfunding Service Providers Regulation (ECSPR) governs how platforms are licensed, how they operate, and how investors are protected. It requires transparent information on financing offers, risk checks for retail investors, secure handling of funds through authorized payment service providers, and full compliance with anti-money-laundering standards.
To enable this safely, Kosovo will need a dedicated law regulating crowdfunding service providers. This law should define the licensing requirements, operational standards, and investor-protection rules for platforms that facilitate investment and lending to businesses. The Central Bank of Kosovo, as the authority responsible for the stability and integrity of the financial sector, would be best positioned to oversee and supervise these platforms. Under CBK’s supervision, crowdfunding could grow in a controlled and trustworthy manner, ensuring that both investors and entrepreneurs are protected as this market evolves.
Kosovo has already taken the first big step by deciding to build capital markets. As the new laws are drafted and adopted, we have an opportunity not to stop there. Crowdfunding can be one of the first real benefits for entrepreneurs, giving them a fair chance to grow their ideas and engage investors more directly, including the diaspora.
The foundation is being built. The opportunity is clear. We should use this momentum to turn legal reforms into real access to finance for Kosovo’s private sector.