Banking in Hungary

With increasing demand from foreign and domestic corporate clients for simple and rapid services, more financial institutions are providing universal banking, which ranges from straightforward lending to investment banking and securities trading. Most foreign firms tend to access local credit and capital markets through home-country financial institutions that have opened branches in Hungary. The services industry is concentrated in Budapest with large SSCs from many international important banks.

Under the EU's "single passport" principle, a financial services provider authorized in one EU member state is free to provide that service anywhere else in the EU. EU-based financial institutions are not required to establish a local subsidiary or branch; they are only required to register with the Hungarian Financial Supervisory Authority.

Hungary EU-harmonizing reforms have created a financial environment where virtually all capital related institutions, products, and services can be found. The Hungarian Forint has been fully convertible for all financial transactions since 2001, and both the Hungarian financial market and capital market transactions are fully liberalized.

The Hungarian Forint (HUF) has been fully convertible for all transactions since 2001, a final step in a decade-long liberalization process. A government decree lifted all remaining foreign exchange restrictions and allowed free movement of capital, in line with EU regulations. Businesses and private individuals have free access to foreign exchange enjoying all advantages and disadvantages of the local currency and foreign exchange fluctuation.

Foreign exchange rules allow Hungarian residents to open forint and foreign currency accounts abroad without applying for permission from the National Bank of Hungary, and foreign companies may hold foreign currency without restrictions.

The National Bank of Hungary (NBH) is the central bank and a member of the European System of Central Banks (ESCB). The NBH and the members of its decision-making bodies perform their duties and carry out their obligations independently from the government. With the exception of the European Central Bank, the NBH (and the members of its decision-making bodies) may not ask for or follow instructions from the government, the institutions and bodies of the European Union, the governments of other EU Member States or any other institution or body.

The MNB oversees the banking system, as well as the capital, insurance and pension fund markets. As a member of the supervisory community of the European Union and in an integrating financial market, the MNB

• Ensures reliable, continuous and transparent operation of the financial markets; 
• Strengthens confidence in the financial markets; 
• Promotes the development of financial markets based on fair competition; 
• Protects the legitimate interests of market participants; 
• Supports the reduction of consumers' risks by providing access to adequate information; 
• Actively participates in eliminating financial crime.

Since Hungary's accession to the EU, credit institutions registered in another Member State of the EU may engage in cross-border services.

A banking account at a commercial bank is required to register and run a company in Hungary. Wire transfers are used for over 80 percent for payment transaction, and new customers are sometimes required to pay in advance. A letter of credit is often used for more significant and high-value first transactions before mutual trust develops between partners. Credit cards are also used but mostly for individual purchases. 

For more information on our banking services, please contact us.

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