Georgia’s banking system expanded in 2025 with the addition of two new players from the microfinance sector. The total assets of the country’s second-tier banks exceeded 100% of GDP by the end of the year, while net profit reached a record 3.3 billion lari (about $1.2 billion).
As Georgia’s largest lenders — TBC Bank and Bank of Georgia — continue expanding into the markets of Armenia and Uzbekistan, smaller domestic digital and microbanks are still struggling to gain significant market share.
The banking sector remains the dominant segment of Georgia’s financial system, accounting for 89.9% of total financial-sector assets at the end of 2024. Pension funds represented 5.7% of assets, followed by microfinance organizations at 2.1% and insurance companies at 1.4%.
Market dominated by major banks
There are 19 second-tier banks operating in Georgia, including two microbanks. About 76% of sector assets and 75% of the total loan portfolio are concentrated in the country’s two largest lenders: TBC Bank and Bank of Georgia.
Liberty Bank, which serves as the government’s agent for pension and social-benefit payments, is also considered a systemically important bank.
In 2025, Georgia’s banking sector posted double-digit growth. Total assets rose 12.1% year over year to 108 billion lari, equivalent to 102.5% of GDP. The total loan portfolio, including loans to nonresidents, increased by 15%.
Real estate and consumer lending lead growth
Within the domestic lending structure, excluding loans to nonresidents, real estate lending expanded the fastest in 2025, rising 27.9% year over year. Consumer lending followed with growth of 21.9%, while construction loans increased 18.9%.
By contrast, lending to industrial enterprises grew just 4.1%, while loans to commercial businesses rose 3.9%, barely outpacing inflation, which stood at 4% in 2025.
National Bank pushes «larization»
The National Bank of Georgia continued efforts to increase the share of lending in the national currency, a policy commonly referred to as «larization.»
The share of loans denominated in lari increased from 49.7% in 2021 to 58.6% by the end of 2025. The trend was driven by rapid growth in consumer lending and several regulatory measures.
Among them was an increase in the minimum threshold for foreign-currency loans, which rose from 400,000 lari in May 2024 to 750,000 lari starting in August 2025.
The decline in dollarization also came amid a strengthening national currency, which appreciated 4.1% in 2025, as well as higher interest rates on lari deposits. Average annual rates on lari deposits reached 10.3%, compared with 2.7% for foreign-currency deposits.
In November 2024, regulators also increased reserve requirements for banks to 25% for foreign-currency liabilities, compared with 5% for lari liabilities.
Traditional and digital banks compete for market share
Alongside Bank of Georgia, TBC Bank and Liberty Bank, another group of 11 traditional banks collectively controls 17.4% of sector assets. Most specialize in specific market niches.
Seven of those banks are owned by foreign holding companies, including BasisBank, ProCredit Bank Georgia, İşbank Georgia, Ziraat Bank Georgia, PASHA Bank Georgia, Halyk Bank Georgia and VTB Bank Georgia.
In addition to traditional lenders, Georgia’s financial market includes three digital banks — Paysera, Hash Bank and Pave Bank — that are seeking to compete with established institutions through fintech services.
These banks operate entirely online without physical cash-service branches and are regulated under a separate framework established by the National Bank of Georgia.
Georgia aims to become a fintech hub
A key feature of Georgia’s digital banking model is phased licensing through a regulatory sandbox framework. The country is positioning itself as a regional hub for crypto assets and fintech innovation.
Digital banks currently focus on international money transfers, payment services and cryptocurrency transactions. Further simplification of cross-border payments is expected as Georgia moves toward integration with the European SEPA payment system.
Kazakhstan’s Freedom Bank eyes Georgian market
A new foreign player is also preparing to enter the Georgian banking market.
Freedom Bank Kazakhstan received approval from Kazakhstan’s regulator in November 2025 and is now preparing to launch a subsidiary in Georgia.
According to Natia Turnava, governor of the National Bank of Georgia, the Kazakh lender is consulting with central bank specialists and preparing to submit a banking license application.
