Daniel is Founder and CEO and has 20 years of experience in the international finance world focusing on cross-border payments, technology and the property sectors. Daniel is widely quoted as an expert within the money transfer industry including by The Economist, The Wall Street Journal, Reuters, CNBC and Bloomberg. Daniel is passionate about helping consumers and businesses find the best and most efficient ways to transfer money internationally.

Contents

Summary

As part of the eurozone, Slovakia does not impose currency controls, and there are very few controls imposed by the Slovakian government or the National Bank of Slovakia on capital transactions. There are no restrictions on sending money to Slovakia or transferring money from Slovakia, whether within the EU or outside the EU, though international money transfers in excess of EUR €10,000 must be declared to customs authorities, in accordance with anti-money laundering regulations.

Slovakia's money transfer regulations

Slovakia has been a member of the European Union (EU) since May of 2004 and became a member of the single currency eurozone in January of 2009, adopting the Euro (EUR) as its official currency. Since Slovakia is part of the eurozone, international money transfers can be made freely, whether sending money to Slovakia or sending money out of the country. There are no restrictions on currency transfers or conversions. Capital transactions are subject to very few controls, with the exception of certain currency transfer rules for commercial banking and credit institutions, which must adhere to existing banking and anti-money laundering regulations.

Currency union

Slovakia became a member of the single currency eurozone in January of 2009, adopting the Euro (EUR) as its official currency. The euro is the second most traded currency in the world after the US dollar. Sending money within the single currency eurozone has been vastly simplified since the introduction in 1999 of the euro. The formation of the EU created a single payment system for member countries, essentially making it much simpler, faster, and cheaper to transfer money between countries. This single payment system extends to countries such as Liechtenstein, Iceland, and Norway, which have maintained their independent currencies. Transferring money throughout the EU region is now easier to regulate and safer as a result.

Slovakia's economic background

Slovakia’s central bank, the National Bank of Slovakia, has adopted economic measures and EU-mandated fiscal targets as part of its membership in the EU. Its ability to attract foreign direct investment has declined in the past few years, due in large part to the elimination of the flat tax and the imposition of a higher tax rate on corporations, as well as a progressive tax rate targeting high income earners.

Slovakia’s dominant sectors as of 2012 were industry (27.0 %), wholesale and retail trade, transportation, accommodation and food services (22.3 %) and public administration, defense, education, human health and social work activities (13.3 %). The country’s workforce is young, educated, and mobile, but unemployment remains high. Currently, Slovakia has strong trading ties with Germany and the Czech Republic, as well as Poland and Russia.

Foreign investment in Slovakia

From 2000 through 2005, the Slovakian government adopted a series of reforms meant to increase direct foreign investment by attracting investors and businesses into the country. These reforms led to Slovakia being ranked the world’s top reformer for an improved business climate in the World Bank’s ‘Doing Business’ 2005 report. However, after 2006 momentum for reform slowed, due in large part to a newly-elected government intent on meeting EU membership requirements. Since 2013, Slovakia has suffered from a slowing economy, high unemployment, and decreased foreign direct investment. In order to meet EU mandates for a fiscal deficit that fell below 3% of GDP, Slovakia canceled its 19% flat tax rate and imposed a new set of tax rules. The corporate tax rate was raised to 23%, and a progressive tax rate that targeted high income earners was established.

According to the US State Department, in 2014 US foreign direct investment into Slovakia only totaled $60.3 million, out of a total inflow of foreign direct investment into the country of USD $50 billion. All fund transfers and conversions associated with investments into and out of the country are governed under the Foreign Exchange Act. In 2003, an amendment to this act abolished the limit on the export and import of all domestic and foreign currency banknotes and coins. Slovakian residents are permitted to open accounts abroad, and non-residents are allowed to hold foreign exchange accounts. Citizens of Slovakia are allowed to buy, sell, or trade foreign securities without limitations.

Slovakia's monetary and regulatory authority

Slovakia is a member of the EU and the single-currency eurozone, which means it follows the regulations and guidelines of the single monetary policy set by the European Central Bank (ECB). The ECB applies liberal economic and foreign exchange policies and the euro is a free floating currency. The Slovakian government and Slovakia’s central bank, the National Bank of Slovakia, oversee the Slovakian banking system, and ensures all transactions and the operation of cash and electronic payments meet the standards established by the ECB.

Property ownership

Residents of Slovakia are able to purchase, sell, or exchange international real estate without restrictions. Both domestic and foreign private entities are permitted to establish and own business enterprises without restriction, and businesses are able to contract directly with any foreign entities. Non-residents from OECD member countries or the EU are permitted to purchase real estate to use as a business premise.

Currency

Slovakia, a member of the eurozone, uses the euro as its official currency. The euro is based on a system of 100 cents/1 euro. Euro banknotes are printed in denominations of EUR5, EUR10, EUR20, EUR50, EUR100, EUR200 and EUR500. Euro coins are popular and commonly used, and are available in values of 1, 2, 5, 10, 20 and 50 cents, EUR1 and EUR2. The bank for each eurozone member country is responsible for issuing banknotes and coins for that country’s use.