ESTONIA

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With a population of 1,3 million and a forecasted GDP of $45bn in 2025, Estonia belongs to the group of high-income countries. It is a small, open economy underpinned by a diversified advanced services and digital sector, relatively high income per capita, and a transitioning external position.

Following persistent deficits, the country achieved a net positive net international investment position (NIIP), estimated at +9.5% of GDP by end‑2024, having shifted from –21.1% in 2023. As of March 2025, Eurostat reports NIIP at approximately –11.9% of GDP — reflecting valuation and data-method variations.

A notable economic weakness remains Estonia’s rising public debt, though from a low starting point: debt-to-GDP stood at around 25.4% in 2024, rising to 28.1% in 2025 and expected to exceed 30% by 2028 under current policy assumptions. Debt service costs are modest, supported by fiscal credibility and prudent policy frameworks. Real GDP contracted by around 3.0% in 2023 and a further 0.3% in 2024, but forecasts increasingly point to recovery: growth of 1.7% in 2025 and 2.6% in 2026.

Historical fiscal discipline has kept the debt ratio substantially below euro‑area peers. That said, future public debt reduction remains a policy ambition: early‑1990s debt was modest but well‑managed, and Estonia avoided major fiscal crises by maintaining balanced budgets. Key medium‑term challenges include wage growth outpacing productivity, rising input costs, demographic ageing, and exposure to geopolitical shocks—particularly defence spending pressures. 

Overall, economic growth is expected to gradually recover toward potential levels in 2026.

 

Currency

  • Euro (EUR).

Bank accounts

  • A company is generally considered resident in Estonia if it is registered in Estonia.

BNP Paribas Cash Management Capabilities

Cash collections
Cheque collections
Direct debit collections
Domestic incoming transfers
Virtual IBAN
Virtual accounts
International incoming transfers
Card acquiring

Payments & collections

Electronic credit transfers are the most commonly used payment instruments by companies to make supplier, payroll and tax payments. There is a growing migration of inter-bank payments from SCT to SCT Insts, which comprises nearly 60% of domestic payments. Card payments, especially debit card payments, are the most popular payment instrument in Estonia for retail payments, although cash is still used. Approximately 35% of card payments are contactless.

Electronic banking services are available from all banks. There is no national electronic banking standard in Estonia, so companies use banks’ proprietary services. Transaction and balance reporting, automated end-of-day sweeping, and transaction initiation services are available on a domestic and cross-border basis. The government fully converted to e-invoicing in 2019, and e-invoicing is now the primary method for invoicing in the country.

Estonian banks have a high level of digitization and automation. Mobile and internet banking services are available and widely used. There are a number of online banks operating including bunq, N26 and Monese. Estonians initiate 99.8% of credit transfers in digital channels, of which 76% are in browse- based internet banking and 23% in a mobile banking app.

Short term investments

Interest payable on credit balances

  • Interest-bearing current accounts are permitted for residents and non-residents denominated in EUR or foreign currency.

Demand deposits

  • Demand deposits denominated in EUR or major foreign currencies are available to both residents and non-residents.

Time deposits

  • Time deposits are available in EUR or major foreign currencies for terms of one night to more than five years.

Certificates of deposit

  • Domestic commercial banks issue certificates of deposit with maturities up to one year.

Treasury (government) bills

  • T-bills, when issued, are issued with a maturity up to 12 months.
  • The maximum outstanding amount of T-bills is limited to EUR 2.5 billion.
  • The issuance of T-bills is not a public issue.

Commercial paper

  • Commercial paper is offered with maturities of three to six months.
  • The EBRD and the central banks of Estonia (Eesti Pank), Latvia (Latvijas Banka) and Lithuania (Lietuvos Bankas) have joined forces to develop a regional market for commercial papers. A Memorandum of Understanding, signed on 5 March 2021, sets out the principles of cooperation to develop a deeper and more efficient regional CP market in line with the best practices outlined in the Short-Term European Paper by the European Central Bank (ECB). It states that the papers must be freely transferable and capable of being traded over-the-counter.

Money market funds

  • Domestic money market funds are available.

Repurchase agreements

  • Repurchase agreements are available.

Banker’s acceptances

  • Banker’s acceptances are not used.

BNP Paribas Trade Finance Capabilities

Documentary credits
Documentary collections

International trade

  • As a member of the EU, Estonia follows the EU customs code and applies all associated regulations and commercial policies.
  • Trade with other countries in the European Economic Area (EEA) and Switzerland is exempt from tariffs and other controls.