Italy, the third largest economy of the Eurozone, was still recovering from the debt and financial crisis, when the Covid-19 epidemic occurred. Real GDP plunged by 8.9% in 2020, recording one of the biggest contractions in Europe. Given the scale of the economic shock, a return towards GDP level observed during the year 2007-2008 will become longer than envisaged initially. Furthermore, real disposable income per capita remains below pre-euro accession levels. The Covid-19 crisis is likely to have amplified the structural weaknesses of the Italian economy, which is widely seen as a low-potential growth economy with structural weaknesses. Several restrictions on both labour and production and the huge level of public debt are weighing on productivity, investment and activity growth. An imperfect match of the skills of the working population to market need and low R&D spending also affect growth.
Public finances will sharply deteriorate partly because of the countercyclical measures put in place to weather the crisis. The fiscal deficit reached 9,5% of GDP in 2020. The public debt ratio is expected to climb to 159.8% in 2021, having jumped by more than twenty percentage points in 2020 as a result of the coronavirus crisis.
The Italian commercial sector is characterised by family-owned companies that offer particular specialisation, often grouped into "industrial districts". However, most Italian firms are small and suffer from weak productivity, which made them particularly vulnerable to the coronavirus crisis. Investment is structurally low and Italy's integration in global value chains remains limited.
Italy is one of BNP Paribas' 'home' markets, and is the fourth largest bank in the country with comprehensive capabilities for all customer segments. BNP Paribas is a leader in corporate banking in Italy, with 46 business centres, and more than 70 people specifically dedicated to cash management services. The bank also provides a complete service offering in trade finance across 5 trade centres. Corporate customers include Italian companies of all sizes, together with Italian subsidiaries of foreign companies. These organisations are attracted to the bank's strong balance sheet, depth of domestic and international products and services, including proximity services across Italy, international footprint and commitment to service quality.
|
2016 |
2017 |
2018 |
2019 |
2020 |
Exchange rate: |
0.9040 |
0.8873 |
0.847 |
0.893 |
0.88 |
Source: IMF, International Financial Statistics, July 2021.
Bank Supervision
Inside Italy | Outside Eurozone | |
Local Currency | Permitted without restriction, fully convertible. | Permitted without restriction, fully convertible. |
Foreign Currency | Permitted without restriction, fully convertible. | Permitted without restriction, fully convertible. |
Inside Italy | Outside Eurozone | |
Local Currency | Permitted without restriction, fully convertible. | Permitted without restriction, fully convertible. |
Foreign Currency | Permitted without restriction, fully convertible. |
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Lifting fees are applied on payments between resident and non-resident bank accounts.
Physical cash pooling | ![]() |
Notional pooling - Balance compensation | ![]() |
Notional pooling - Interest optimisation | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Cash collections | ![]() |
Cheque collections | ![]() |
Direct debit collections | ![]() |
Domestic incoming transfers | ![]() |
Virtual IBAN | ![]() |
Virtual accounts | ![]() |
International incoming transfers | ![]() |
Card acquiring | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Cash withdrawals | ![]() |
Cheque payments | ![]() |
Direct debit payments | ![]() |
Domestic outgoing transfers | ![]() |
Commercial cards | ![]() |
Virtual cards | ![]() |
International outgoing transfers | ![]() |
SWIFT gpi | ![]() |
Real-time international payments through BNP Paribas' network | ![]() |
Card issuing | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Local e-Banking | ![]() |
Global e-Banking - Connexis | ![]() |
SWIFT/ host to host | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Electronic credit transfers are most commonly used by companies to make supplier and payroll payments, although some smaller businesses continue to use cheques. Payment card use is increasingly rapidly, with cards (especially debit cards) the most widely used payment instrument by volume. In 2020, the government promoted the use of cashless payments for in-store payments with 10% rebates for users of cards or mobile apps for payments. Known as the Italia Cashless, the scheme, part of the government’s plan to modernise payments in the country, was suspended in June 2021. Contactless card transactions account for more than half of all in-store card payments.
The CBI (Customer to Business Interaction) Consortium, established by the Italian Bankers’ Association (ABI) has introduced a multibank digital signature standard as well as XML-based standards for SEPA credit transfers and direct debits, the electronic exchange of invoices, invoice financing, and structured statements. Banks are required to offer the CBI Consortium online banking platform. Over one million companies use CBI Consortium electronic banking standards.
Digital banking services are increasingly available and widely used, particularly mobile banking services.
TARGET 2-BI | Type |
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Participants |
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Transaction types processed |
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Operating hours |
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Clearing cycle details (e.g. cut-off times) |
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System holidays |
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HAM | Type |
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Participants |
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Transaction types processed |
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Operating hours |
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Clearing cycle details (e.g. cut-off times) |
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System holidays |
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BI-COMP | Type |
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Participants |
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TRANSACTION TYPES PROCESSED |
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Operating hours |
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Clearing cycle details (e.g. cut-off times) |
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System holidays |
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Cross-border notional cash pools are not usually based in Italy because of the restrictions on banks offsetting credit and debit balances.
Interest payable on credit balances
Demand deposits
Time deposits
Certificates of deposit
Treasury (government) bills
Money market funds
Repurchase agreements
Banker's acceptances
Documentary credits | ![]() |
Documentary collections | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Bank guarantees | ![]() |
Standby letters of credit | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Receivables | ![]() |
Payables | ![]() |
Inventory | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Connexis Trade | ![]() |
Connexis Supply Chain | ![]() |
SWIFTNet Trade for Corporates | ![]() |
Connexis Connect | ![]() |
![]() | Supported by BNP Paribas |
![]() | Not required / permitted in ITALY or not supported by BNP Paribas |
Imports |
Crude petroleum
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Cars |
Packaged medicines |
Natural gas |
Refined petroleum |
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Primary Import sources |
Germany (16.0%) |
France (9.0%) |
China (7.0%) |
Spain (5.0%) |
Netherlands (5.0%) |
Belgium (5.0%) |
Exports |
Packaged medicines |
Cars and vehicle parts |
Refined petroleum |
Valves |
Trunks/cases |
Wine |
Export markets |
Germany (12.0%) |
France (11.0%) |
USA (10.0%) |
UK (5.0%) |
Spain (5.0%) |
Switzerland (5.0%) |
|
2016 |
2017 |
2018 |
2019 |
2020 |
|
Exports |
- goods USD m |
453,707 |
491,177 |
532,948 |
513,843 |
470,634 |
- services USD m |
100,444 |
112,710 |
123,108 |
122,168 |
87,626 |
|
Imports |
- goods USD m |
389,869 |
429,379 |
478,799 |
446,538 |
393,319 |
- services USD m |
104,126 |
116,898 |
126,636 |
123,165 |
93,029 |
|
Current account as % GDP |
+ 2.5 |
+ 2.6 |
+ 2.7 |
+3.5 |
+ 4.2 |
Source: IMF, International Financial Statistics, July 2021.
Resident entities have to report transactions with non-resident entities on a monthly, quarterly or annual basis, depending on company and report type.
Payments to: | Interest | Dividends | Royalties | Other income |
Resident entities | 0%/26% | None | None | None |
Non-resident entities | 12.5%/26% | 1.20%/26% | 22.5% | 30% |
Tax information supplied by Deloitte Touche Tohmatsu and Deloitte Highlight 2021 (www.deloitte.com).