Eesti Pank’s strategy for 2021-2025 was put together in autumn 2020. Whether the strategy needs to be brought up to date and reviewed is assessed each year.

The strategy above all presents a general picture of all of the most important activities and operations of Eesti Pank. Then it focuses on five main goals. These are the development tasks for the next five years, which can in themselves lead to larger changes.

Eesti Pank’s mission

As the central bank of the Republic of Estonia and a member of the Eurosystem, we contribute to the sustainable development of the Estonian economy and to increased prosperity for Estonia. We keep price growth moderate, setting a joint monetary policy together with the other central banks of the euro area and implementing it in Estonia. We maintain the stability of the Estonian financial system by helping to set policy for the financial sector. We ensure that cash is of good quality and promote a safe and efficient payment environment. We give an independent assessment of the state and outlook of the economy, we advise the government on important matters of economic policy, and we produce high-quality statistics.

Eesti Pank’s vision

The positions and actions of Eesti Pank are considered in Estonia and abroad. Eesti Pank is an efficient and innovative organisation and is the most highly regarded authority in Estonia on questions of finance and the economy at the macro level.

The operating environment for Eesti Pank in 2020 and its main tasks

The main functions of Eesti Pank are set out in §2 of the Eesti Pank Act. In carrying out these functions, account must be taken of the current state of the economy, the development of the financial sector, and the strategic priorities of the central bank.

Eesti Pank plays an active role in setting monetary policy in the euro area and in the related decision-making. To do this, the central bank analyses thoroughly the processes that affect the Eurosystem as a whole and the Estonian economy alone. The purpose of the analysis and economic research is to provide information that can be used in decisions on monetary policy and financial stability, and to give support to experts and managers from the central bank in discussions of economic policy. Eesti Pank ensures the quality of the analysis by working together with other central banks and with research institutions and universities in Estonia and abroad.

The virus crisis that erupted at the start of 2020 caused a sharp contraction in the economy. As an economic contraction generally leads to lower inflation, the central banks of the euro area took determined steps to support the economy by substantially easing the conditions of monetary policy loans from the central bank, and expanding purchases of various financial assets. Despite this it is very probable that the coronavirus crisis will have a long-term negative impact on the economy. In consequence monetary policy will remain supportive of inflation in the coming years, and discussions about extraordinary monetary policy measures, including negative interest rates and the termination of the broad-ranging asset purchase programme, have been postponed into the more distant future.

The decisions of the central bank about the price of money and how much of it there should be are passed on to households and businesses through the financial system. Monetary policy is enacted through the transactions of the central bank with the commercial banks. During this, the financial soundness of banks as counterparties and the quality of their collateral are assessed. The commercial banks in Estonia have access to liquidity loans and deposit facilities under the agreed Eurosystem terms. Demand from Estonian banks for ordinary and extraordinary monetary policy loans has increased.

Low interest rates make it harder for Eesti Pank to earn income from its reserves. Eesti Pank has reacted to changes in the operating environment and has spread its risks by adding further asset classes to the investment portfolio. The aim of long-term investment activity by the central bank is to make sure that the income earned from investment and from monetary operations is large enough and would improve the capitalisation of Eesti Pank and its capacity to bear any losses that could arise from risk scenarios being realised. The more distant goal is to bring the capitalisation of Eesti Pank into line with the average of the central banks in the Eurosystem.

Eesti Pank backs up the functioning of the financial system as a whole. Responsibility for micro level supervision of banks in the euro area lies with the supervisory authorities of member states, which is Finantsinspektsioon in Estonia, working together with the European Central Bank. Eesti Pank is responsible for macroprudential supervision, for analysing and assessing the risks to the Estonian financial sector as a whole, and for introducing requirements at the necessary level for the capital and lending of the commercial banks.

Eesti Pank has developed a macroprudential framework and set capital requirements and requirements for issuing housing loans in order to reduce the risks of the banks. To analyse better the risks to financial stability, the central bank focuses closely on improving its own analytical capacity. During the recovery from the economic crisis, Eesti Pank focuses on supporting the sustainable development of the financial sector.

Eesti Pank needs to make sure that participants in financial markets are able to comply with ever stricter requirements to combat money laundering and terrorist financing, and that money of suspicious origin does not move through the Estonian financial system, while banking services remain accessible to legally compliant clients. Eesti Pank helps collect the data needed for this, and takes part in joint projects to research how financial technology can be used to detect patterns of money laundering early on at the level of the interbank payment systems.

The role of the central bank has increased in strategically promoting a secure and efficient environment for payments in cooperation with banks, other payment services providers and technology companies. The focus of attention has been drawn to fast and convenient payment systems that are integrated through mobile wallets and other locations and digital platforms into people’s everyday lives and the activities of businesses.

Within all of this, is becoming ever more important to safeguard security and develop a general cyber resilience[1] and anti-fraud solutions, and Eesti Pank contributes to this in a supervisory role. Instant payments become the new standard in Estonia for bank transfers, and use of open banking services is increasing. Payment solutions that work in real time are consequently being gradually introduced, making the process of requesting money and making payments smoother. This increases the range of choices available to people and companies alongside card payments and cash.

Together with the other central banks of the euro area and the European Central Bank, Eesti Pank issues the notes and coins of the legal tender of the euro area. Eesti Pank makes sure that demand for euro banknotes and coins is met and sufficient cash reserves are maintained, and that cash is of the appropriate quality and protected against forgery. Access to cash has been improved by the option of withdrawing it as cashback from shop tills, though there is concern about the shortage of small denomination coins in circulation as people accumulate them without spending them. The reduced use of cash as a means of payment has made the idea of circulating a digital currency issued by the central bank more topical, and Eesti Pank is analysing this together with the other central banks of the Eurosystem.

Payment systems are a central part of the financing infrastructure of the economy. Eesti Pank operates the TARGET2-Eesti settlement system, which is a technical platform for executing monetary policy where banks hold client funds securely in central bank money, and which is used for fast and secure interbank transfers of funds between banks. Eesti Pank is also involved in the operation of the security settlement platform TARGET2-Securities and administers the instant payment platform TIPS (TARGET Instant Payment Settlement) jointly with other central banks of the euro area. To support innovation and fair competition, the need to oversee the conditions for opening accounts at banks and other payment institutions and making payments through the systems of the central bank has become more topical.

Eesti Pank is responsible for compiling the statistics for the Estonian financial and external sectors and for the financial account. As a compiler of national statistics, the central bank supplies good quality, reliable, up to date and impartial information that is used in analysis, forecasting and policy setting, and is released publicly. Eesti Pank also helps compile statistics for the European economic and monetary union and works in developing the statistical methodology.

Eesti Pank’s key development tasks 2021-2025

Goal 1.

In advising the government and the public and in carrying out macroprudential supervision we will focus in the coming years primarily on the recovery from the economic crisis and on supporting the sustainable development of the financial sector.


Under the Eesti Pank Act, Eesti Pank advises the government on monetary policy issues and the government does not take any important economic policy decisions without first listening to Eesti Pank’s opinion. The knowledge needed to do this comes from the everyday analysis by the central bank of the economy and financial sector, and from its participation in the work of the Eurosystem and in economic policy debates in the European Union. When advising the government and the public on economic matters and sharing information with them, it is important to foresee which economic policy topics may become more important in the future so that the attention of political leaders and the public can be drawn to them. Eesti Pank also advises the Fiscal Council.

The most important issues in advising the public and the government in the coming years will be easing the economic crisis caused by the coronavirus, reducing the associated risks, and recovering from the crisis. More attention will need to be paid than currently when giving recommendations to factors that will affect the recovery in economic growth, including financing of the economy and state support measures; to assessing the global trends that will affect long-term developments in the economy and the financial sector, and the accompanying opportunities and risks; and to the impact of particular political policy choices on Estonia’s international competitiveness, including how attractive the country is as an investment destination.

Eesti Pank speaks mainly on questions of price stability and financial stability, but also on the competitiveness of the Estonian economy and topics that affect its long-term growth and on which Eesti Pank is sufficiently knowledgeable, and that relate to the core issues of the bank. The long-term development of Estonia will be substantially affected by climate goals for example, and so the central bank must assess how the structural changes they cause for the economy affect the economic environment, financial stability, financial sector legislation, the financing of the economy, and competitiveness.

In the years ahead, Eesti Pank will take part in discussions setting the future for the European Union and in reviewing the monetary policy strategy of the Eurosystem, and it will involve the Estonian public in this.

It is important that the central bank be sufficiently well staffed if it is to be a centre of competence for analysing the macroeconomy and the financial sector at the macro level, analysing other new topics and trying out new approaches. We will work more closely than ever with other state institutions and competence centres handling the same topics.

All the economic policy recommendations and conclusions of the central bank must always be based on proper analysis, and should be clearly and understandably presented.

Eesti Pank publishes statistics for various interest groups, including statistics on the financial sector. To improve the quality of the analysis of the financial sector, the statistics for the financial sector need to be expanded. To make the statistics easier to use, statistical releases need to be published covering all the main areas of statistics.

Expected results

  1. Eesti Pank has been an active and effective participant in economic policy debates on topics that come under the mandate of the central bank, and itself has also raised topics that are new and important.
  2. The positions and opinions of Eesti Pank are trustworthy, clearly worded and well-focused.
  3. Eesti Pank’s statistics are more detailed and more visible to the public than before, as this lets the central bank do its work more efficiently and improves the quality of public debate.


  1. In advising the government and the public on economic and financial sector policy we will focus above all on factors that will affect the recovery in the economy, including the financing of the economy and state support measures. We will also support sustainable development, assessing the global trends that will affect long-term developments in the economy and the financial sector and the accompanying opportunities and risks, and the impact of particular political policy choices on Estonia’s international competitiveness, including how attractive the country is as an investment destination.
  2. When setting macroprudential policy and deciding and implementing the tools for it, we will take account of the impact of the crisis and changes in the structure of the financial sector. To strengthen this process, we will consider setting up an advisory council within the bank to assess macroprudential measures.
  3. We will regularly assess the topics on which Eesti Pank is able to speak. We will create new opportunities for meaningful debates in order to ensure that Eesti Pank’s recommendations are well founded and as useful as possible for policy-makers.
  4. We will provide a platform in economic policy discussions for foreign experts by organising seminars and discussions on topics where the central bank is not the most knowledgeable expert.
  5. When producing our analyses we will focus more attention on our goals and on the clarity of our message. Where necessary we will help to carry out what we advise, as far as this is in line with the skills and abilities of Eesti Pank.
  6. We will focus more attention than before on advising the government in various working groups, commissions, advisory councils and similar.
  7. We will gradually publish new statistics on the financial sector.
  8. We will develop statistics by publishing statistical releases on all the main areas of statistics. We will look for ways to produce flash statistics to give information on the financial sector and the whole economy more promptly.


Goal 2.

There is sufficient high-quality cash in Estonia for everyday circulation and for times of increased demand, and Estonian businesses and consumers can use innovative and secure means of payment. Monetary policy loans are easily accessible to commercial banks in Estonia.


Changes in the Estonian financial sector such as the establishment of Luminor or the increase in the market share of small banks, the possible impact of the virus crisis, and changes in monetary policy may substantially increased demand for ordinary or extraordinary monetary policy loans. Eesti Pank must be ready to accept more varied forms of collateral. The range of collaterals will be increased by the capital market in Estonia becoming more varied.

The key trends in the payments market at present are the development of financial technology, the success of e-commerce, innovative payment solutions, and a widening circle of service providers. Eesti Pank supports financial innovation and is keen to see that new solutions are secure, function well and can easily be used in real time. In the current market, non-bank providers of financial services are largely dependent on banks to provide their services. Eesti Pank supports the establishment of equal conditions for all payment service providers.

The disclosure of cases and suspicions of money laundering has made the Estonian financial sector more cautious and has limited the access of non-residents to banking services, which has made payment and financial services in general less accessible to residents as well. Eesti Pank considers it important that legally compliant clients should have access to banking services. The Estonian state aims to assess money-laundering risks better, partly by collecting additional information from credit institutions for analysis where needed.

Over the past five years credit institutions in Estonia have reduced their coin exchange services. Paying coins onto accounts in credit institutions or exchanging them for banknotes is largely a paid service, and the price of it is set by the credit institution. Eesti Pank has a legal obligation to organise the circulation of cash, and the central bank is involved in resolving bottlenecks in the supply of cash. We are looking for ways to bring coins back actively into circulation, as this would reduce the annual need for the central bank to mint coins and would indirectly reduce the costs of cash management.

Ensuring the quality of cash in euros and the credibility of the euro is a joint requirement for all the countries in the euro area. To prevent counterfeits from spreading and poor quality cash from circulating, the operations of the cash handlers working in Estonia must comply with the legal requirements for them. As the organiser of cash circulation, Eesti Pank supervises the operations of cash handlers, in which it monitors the authenticity of banknotes and whether they are fit for circulation, and applies the requirements for returning them into circulation.

Eesti Pank has to organise the production of euro banknotes. The production of banknotes is organised through procurement processes, and this needs knowledge of banknote production and the skills for it to be kept up to date.

Expected results

  1. Eesti Pank has a good picture of how financial innovation affects the financial sector and the payments market and the opportunities and risks that come with it.
  2. Eesti Pank has helped the responsible authorities to reduce the risks from money laundering and terrorism in Estonia and supports the development of the legislative framework.
  3. The Estonian legal environment and Eesti Pank working with the financial sector encourage development through financial innovation and create good conditions for all providers of financial services to offer their services, ensuring that the accompanying risks are reduced.
  4. Settlement of large value payments, securities and instant payments through TARGET is straightforward and the conditions of access are clear for banks and other providers of financial services.
  5. The set of assets that the commercial banks in Estonia can use as collateral for monetary policy loans has been extended. The banks are better able to participate in monetary policy operations.
  6. Cash services are accessible to consumers on the basis of demand through cooperation with banks and commercial enterprises.
  7. Eesti Pank staff have the knowledge and skills needed to organise the production of euro banknotes.


  1. We will regularly assess how technological development affects the financial sector and the payments market and the opportunities and risks that this brings.
  2. We provide opportunities for partners to participate in projects that will encourage the development of the financial environment and the payments market in Estonia and the availability of payment services and other financial services.
  3. We guide cooperation between market participants and the public sector through the Estonian Payment Forum. We will help market participants reach strategic agreement on setting up new payment solutions and undertaking projects that allow sales and purchases to move over to digital solutions that will enable machine-readable information exchange.
  4. We will help institutions that combat money laundering and terrorist financing or oversee these areas to collect the data they need from credit institutions for analysis. We will help compile the national risk assessment for money laundering.
  5. We will help the Ministry of Finance and Finantsinspektsioon to set up a legal environment that encourages financial intervention and helps to reduce risks, focusing on increasing competition in the financial sector by ensuring equal conditions for banks and other providers of financial services.
  6. We will participate in the consolidation project for the large-value payment system TARGET2 and the securities settlement system TARGET2-Securities, and we will help to simplify the business processes and technical availability of TARGET services. We will design access policy for TARGET services, including the TIPS services intended for pan-European settlement instant payments.
  7. We will increase our capacity for collateral management, participating in creating the European Collateral Management System (ECMS), which will allow transactions with qualified collateral to be managed wherever the collateral is located in the euro area. We will expand the option of providing credit claims as collateral, creating an in-house credit assessment system or participating in creating a similar pan-European system.
  8. We will work together with market participants in carrying out monetary policy operations, to make the Estonian capital market more varied.
  9. We will ensure that the distribution network functions to provide at least the minimum amount of cash needed if there is an interruption to electronic payments.
  10. We will increase the recirculation of coins to reduce the ecological footprint of cash.
  11. We will strengthen supervision over cash handlers and the quality of cash in circulation.
  12. We will train our staff who work with cash in the production of banknotes, covering the materials used, security elements, production and polygraphy, and quality control.

Goal 3.

Eesti Pank is ready to carry out its duties in the event of a crisis and to ensure the functioning of payments and cash circulation in an emergency.


The ability of Eesti Pank and other financial market participants to carry out their core duties in the event of various crises has become ever more important. Cyber attacks on the financial sector have become more common and have made it necessary to assess and improve the cyber resilience of critical systems of financial market infrastructure. To ensure the uninterrupted operation of payment services it is important to apply security measures in all of the information systems providing critical services.

The Eurosystem as supervisor has developed a strategy for cyber resilience to reduce the cyber risks to financial market infrastructure and Information Systems of service providers. To improve the resilience of the Estonian financial sector to cyber attack, we are analysing the introduction of a new joint framework for testing cyber resilience in Estonia, and the role of Eesti Pank within this. It is Eesti Pank’s job as supervisor to assess the resilience of financial market infrastructure to cyber attack.

In the event of a banking crisis, Eesti Pank must be ready to provide extraordinary liquidity support for banks suffering liquidity problems to support the stability of the financial system and the capacity of the economy to recover from the crisis. The readiness of Eesti Pank to provide liquidity needs to be monitored regularly and the associated procedures must be kept up to date.

The Emergency Act requires that Eesti Pank ensure that interbank payments operate even if the interbank settlement systems that are normally used are not functioning, and organise the operation of card payments as a vital service and ensure that cash circulation functions. Eesti Pank should also be ready to meet an unplanned increase in the demand for cash for settlements, and must support the supply of cash to the public.

In ensuring cash services we must consider what is happening in the market, the updated business models of banks for providing cash services, and changes in the cash transport market. The continuity plans for cash circulation must be regularly tested. The central bank must also regularly assess the vital payment services, including the operation of card payment infrastructure in changing market situation, and must test its continuity in an emergency.

Expected results

  1. Eesti Pank is ready to react in an emergency and to ensure the uninterrupted functioning of critical processes.
  2. Eesti Pank has ensured liquidity support for the banks and the operation of critical interbank payments.
  3. Eesti Pank has ensured the supply of cash in the country and the operation of cash circulation.
  4. Eesti Pank has worked with the banks to organise the smooth operation of card payments through real-time authorisation in an emergency and in the event of temporary interruption.
  5. Eesti Pank has worked on cyber security with state institutions and companies from the financial sector and where necessary coordinates their operations to manage cyber risk and test cyber resilience.


  1. We will set up and test procedures and storage solutions with the commercial banks and cash transporters so that cash services can be provided in an emergency.
  2. We will work with the commercial banks to assess, test and improve the procedures and storage solutions set up for the operation of critical payments.
  3. We will work with the banks to develop solutions to ensure the continuity of card payments, so that payments will function if ordinary and immediate authorisation for card payments does not work.
  4. We will help apply the cyber resilience strategy of the Eurosystem in Estonia, and as overseer we will assess the cyber resilience of the Estonian card payment system. Where necessary we will work with Finantsinspektsioon and the other central banks of the Eurosystem to assess the continuity and cyber resilience of the main interbank payment systems in the Estonian payments market.
  5. We will update and test the procedures for providing extraordinary liquidity assistance to the banks.

Goal 4.

Eesti Pank makes sure of the security, continuity and cyber resilience of its information systems even when operating outside the buildings of the bank.

Developing the information systems supports Eesti Pank in fulfilling its main duties and in organising its work more efficiently.


Cyber attacks against companies and state institutions are becoming ever more complex and harder to identify. To be able to cope well with the changing dangers, Eesti Pank has drawn up an action plan for improving cyber resilience. There has not yet been any incident that has threatened the IT systems of Eesti Pank and we want to ensure that this remains the case in the future.

It is of prime importance for Eesti Pank to ensure the security of the central bank’s information systems, as preserving the assets and data of the bank and its ability to do its work depend on this. Security is built on risk assessment and the best internationally recognised standards and practices. Effective work is done jointly and closely together with other members of the Eurosystem and other parties to ensure that an equally high level of security is maintained throughout the Eurosystem.

To achieve the goals of the central bank and develop the organisation of work, it is important to put in place the right solutions in the information system to digitise processes and automate routine work. It is important to make it possible for staff to use the services of the information system in the same way whether they are working within the bank or remotely.

The knowledge and skills of the staff have to be improved for them to be able to use IT tools at work and remain security conscious while using the information systems.

Expected results

  1. Eesti Pank has met the definition of the European Central Bank’s Cyber Resilience Oversight Expectations (CROE) model for assessing the cyber resilience of financial institutions at the ‘advancing’ level.
  2. IT services are able to function even if the provision of services within the buildings of the bank is interrupted.
  3. Secure access for staff to the services of the Eesti Pank information system is ensured from wherever they may be. An exception is access to critical information systems with the highest levels of security.
  4. Improved IT skills of the staff and the introduction of new technological tools have created new ways of digitising and automating processes at the bank.


  1. By analysing future events and risks we will ensure our capacity to react rapidly to new cyber threats.
  2. We will provide our employees with constant opportunities to improve and assess their knowledge of security.
  3. We will organise IT training for our staff.
  4. We will apply continuity measures including readiness to work outside the buildings of the bank, to ensure that working processes can be continued in various risk scenarios.
  5. We will introduce new IT solutions to meet the needs of the bank, using the opportunities provided by new technologies and services, and training our staff to use them.
  6. We will launch in the years ahead the development of an integrated data processing system that will allow the constantly increasing demands for statistics to be handled.
  7. We will work with members of the ESCB to develop and install the distributed ICT service.

Goal 5.

Eesti Pank has an attitude of openness and is an efficient, developing and harmonious organisation in the organisation of work. We are results-oriented and make the best use of resources. Eesti Pank is sufficiently well capitalised to ensure it has enough risk buffers and that the central bank’s capital is preserved even under unfavourable circumstances.


Eesti Pank has taken on several new tasks in recent years. At the same time, knowledge, skills and technological resources have all improved, allowing us to do our work better and more efficiently. We have many experts with long experience in central banking, whose knowledge can be used to achieve a range of goals. Employees are motivated by the chance to work in different areas. It is important for Eesti Pank that the experts working here be dedicated, and interested in developing their own areas.

Changes in the Estonian labour market test the organisation of work at Eesti Pank and the capacity to hire and hold on to staff of the appropriate level. To be an attractive employer, we must meet the expectations for contemporary flexible working choices and offer our employees working conditions that motivate them, including the chance to rotate between different positions and to gain experience of different areas of the central bank’s work during their career. We focus more attention than before on planning the development and career opportunities of our staff, and encouraging them to gain new skills and knowledge. In paying the employees of Eesti Pank we use a comparison with the median pay of comparison groups in the financial sector working in Harjumaa.

The changed external environment has taught us to reconsider how we organise our work and to be flexible about working time and places. The new challenge is to improve the digital skills of our staff and to maintain team spirit while working remotely.

Eesti Pank cares for the welfare, work-life balance, health and working environment of its employees. We consider the environmental impact of the organisation and work to reduce it.

Although it is not the core aim of Eesti Pank to earn a profit, it is important to ensure the financial independence of the central bank. To achieve this, the investment portfolio has to be large enough and efficiently managed, and Eesti Pank has to be sufficiently capitalised, which is ensured by risk buffers if developments in the market are unfavourable. This guarantees the credibility and independence of the central bank.

Expected results

  1. The staff of Eesti Pank are skilled, dedicated, and satisfied with their employer and their work.
  2. Eesti Pank is able to carry out all of its tasks ever more efficiently in terms of cost and working hours. This allows us to set new goals and to offer additional value to society.
  3. The management and organisation of work at Eesti Pank are sustainable in various situations.
  4. Equity has been strengthened and the capitalisation of Eesti Pank is approaching the average in the euro area.


  1. We will support the development of the bank and its staff by looking at the long term career outlook for staff, including gaining various skills and experience, or moving between jobs within the bank, the Estonian public sector, the European System of Central Banks, and international organisations.
  2. We will encourage employees to contribute to the development of Estonia outside the central bank as well, through discussions, presentations, contributions to events, and other forms of cooperation, to explain more widely the role and the nature of Eesti Pank, and to make maximum use of the knowledge and skills of Eesti Pank.
  3. We will develop and train our staff in line with the long-term goals of the bank. As part of this our staff will become greater experts on how climate and environmental measures will impact the economy and the financial sector, and if necessary we will bring experts from outside into the central bank. To support the further learning of employees within their field, we will plan a budget for training each year that allows staff to have on average five days of training a year.
  4. We will contribute to staff development through various forms of learning. We will place more emphasis on the goals of training and on using other means of personal development.
  5. We will focus on developing key management skills. We will be realistic in our expectations and flexible in our work relations, using alternative and innovative forms of work.
  6. We will analyse the environmental footprint of Eesti Pank, and find ways to reduce it.
  7. We will use new technological opportunities to develop the investment activities of Eesti Pank. This will ensure profitability over the long term and allow capitalisation to be increased. In taking investment decisions we will focus more attention on the risks associated with monetary policy.

[1]              Cyber resilience is the ability of organisations to provide their services even under sustained cyber attack.