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Cyprus Payment Fraud Rises 30% While Financial Losses Climb 66%

by THEFUTURE.TEAM

February 18, 2026

Introduction: Escalating Fraud In Cyprus

A recent report from the Central Bank of Cyprus reveals a marked increase in payment fraud within the country. The first half of 2025 saw a 30% rise in fraudulent transactions and a 66% surge in the overall value of fraud, reaching nearly €4 million. These alarming figures were documented in the bank’s second report on the matter, highlighting approximately 16,000 fraudulent incidents between January and June 2025 compared to the same period in 2024. Cases include both unauthorized transactions and payments executed following deliberate manipulation by the payer.

Accelerated Growth Relative To The Eurozone

The report underscores that the rate of fraud escalation in Cyprus outpaces the average within the Eurozone. While the overall number of incidents across the Eurozone has remained stable at around 9 million transactions, the monetary value of fraud in the region experienced only a marginal 6% increase to €1.7 billion. Despite the sharp upward trend in Cyprus, the report notes that fraud levels remain acceptable in both absolute and relative terms compared to the broader European average.

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Card Payments And Credit Transfers In Focus

Card payments continue to be the most commonly exploited method, accounting for 92% of fraudulent events. However, credit transfers have emerged as the largest source of financial damage, representing 54% of the total fraud value, which translates to losses of approximately €1.9 million. In contrast, card payment fraud accounts for 45% of the total with losses of around €1.6 million. Notably, the average fraudulent credit transfer in Cyprus reached €5,472, surpassing the national transaction average of €4,496. This positions Cyprus among the countries with the highest average fraudulent credit transfer incidents within the Eurozone.

Cross-Border Transactions And Online Payments

The analysis highlights that cross-border fraud incidents far exceed domestic ones for all payment methods. For instance, fraudulent activity in cross-border card payments is 24 times more likely than that in domestic transactions. Furthermore, while the majority of card payments occur at physical points of sale, nearly 97% of fraud incidents are associated with online transactions. Card payment fraud is predominantly driven by the theft or misappropriation of sensitive payment data, whereas credit transfer fraud often involves the deception of account holders into authorizing payments themselves.

The Imperative Of Prevention And Collaboration

The Central Bank of Cyprus emphasizes the positive impact of stringent Strong Customer Authentication (SCA) in reducing card payment fraud, while noting that human error remains the weakest link in security. In an increasingly complex economic landscape, the report calls for enhanced collaboration among payment service providers, regulatory authorities, and the public. Investments in robust security measures, advanced monitoring technologies, and comprehensive financial education are essential to fortify defenses against emerging fraud schemes.

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ECB Keeps Rates Unchanged As Inflation Reaches 3%

The European Central Bank (ECB) maintained its current interest rate on Thursday, yet signalled growing unease over surging inflation, intensifying market expectations of subsequent rate hikes later this year. With inflation rising to 3%, well above the targeted 2%, the ECB appears prepared to act in June and later in the autumn if necessary.

Heightened Inflation Concerns And Market Reactions

The ECB referred to risks linked to higher energy prices, including developments involving Iran, with oil prices at a four-year high. While longer-term inflation expectations remain stable, short-term expectations have increased. In response, market participants are pricing in potential rate hikes in June and July, with additional adjustments expected later in the year.

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Measured Policy Adjustments Against Economic Headwinds

At the same time, current conditions differ from 2022, when the ECB raised rates by a total of 450 basis points within one year. Recent data show softer labour market conditions and limited economic growth in the euro area during the first quarter, while core inflation has moderated slightly, indicating that broader price pressures remain contained for now.

Balancing Inflation Control With Economic Stability

Policy decisions are being shaped by the need to address inflation while limiting risks to economic activity. Higher energy costs may reduce growth by up to 0.5 percentage points, while indicators point to pressure across sectors, including services and exports, alongside tighter credit conditions.

Global Perspectives And The Memory Effect

Other central banks, including the Federal Reserve, Bank of England, Bank of Japan, and Bank of Canada, have also kept rates unchanged while monitoring inflation trends. According to Lorenzo Codogno, recent inflation developments may influence pricing and wage-setting behaviour, which could affect future inflation dynamics.

Conclusion

Current signals from the ECB reflect a policy approach that keeps rates unchanged while leaving room for adjustments as inflation and economic data evolve.