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Cypriots Lead Europe In Card Usage, Says CBC Governor

by THEFUTURE.TEAM

January 16, 2025

Cypriots use payment cards 1.3 times more frequently than their European counterparts, with contactless card payments accounting for over half of all transactions since 2022. This was highlighted by the Governor of the Central Bank of Cyprus (CBC), Christodoulos Patsalides, during his address at the 12th Banking Forum and Fintech Expo in Nicosia.

Prioritizing The Digital Economy

Governor Patsalides outlined key CBC priorities, including advancements in the digital economy, the evolution of digital payments, the potential implementation of a digital euro, and regulatory frameworks that balance innovation with governance and societal needs. He stressed that these initiatives aim to strengthen Cyprus’ role in the European financial landscape.

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A Resilient Economy And Banking Sector

Despite geopolitical challenges, the Cypriot economy has shown resilience, achieving robust growth rates above the EU average and maintaining strong fiscal discipline. This has resulted in consistent budget surpluses and upgrades from international rating agencies.

The banking sector also demonstrated resilience, with the Common Equity Tier 1 (CET1) ratio reaching a record 23.5% in Q3 2024—well above the EU average of 16%. Additionally, the Liquidity Coverage Ratio (LCR) stood at an impressive 336%, far exceeding the regulatory minimum of 100% and the European average of 161.4%. Non-performing loans (NPLs) fell to 6.5%, their lowest level since 2014.

However, Patsalides cautioned against complacency, citing macroeconomic uncertainties, geopolitical risks, and emerging challenges such as cybersecurity and climate change. Banks, he added, must adopt innovative business models to remain competitive.

Embracing Innovation In Financial Services

Technologies such as artificial intelligence, cloud computing, digital wallets, and biometrics are transforming the financial landscape, Patsalides noted. While these technologies are already improving customer service, automating payments, and enhancing security, he identified untapped potential in areas like distributed ledger technology (DLT), smart contracts, and tokenization.

Acknowledging the rising risks of cyberattacks, he said that supervising cybersecurity and data protection remains a CBC priority. To foster domestic innovation, the CBC has established an Innovation Hub, facilitating dialogue with fintech stakeholders.

Cyprus’ Leadership In Digital Payments

Digital payments now account for 96% of cashless transactions in Cyprus, with card usage increasing significantly. E-commerce is also on the rise, with online card purchases doubling over six years to comprise 28% of all card transactions. Notably, mobile phone payments now account for nearly a quarter of online purchases, surpassing the EU average of 16%.

The CBC has also introduced instant payment systems, enabling 24/7 transactions with funds available within 10 seconds. Additionally, electronic money (e-money) payments are gaining traction, with the CBC licensing 27 e-money institutions and 11 payment institutions as of 2024.

Digital Euro On The Horizon

Updating on the digital euro, Patsalides revealed that the Eurosystem is advancing its preparation phase. The European Central Bank (ECB) is engaging with market participants and preparing the platform and infrastructure for the potential issuance of the digital euro.

Focus On ESG And Sustainability

Patsalides also addressed the evolving ESG (Environmental, Social, and Governance) regulatory landscape, emphasizing strong governance, transparency, and ethical standards. Social factors like diversity, labour practices, and human rights are increasingly critical for credit institutions, alongside climate-related considerations.

To support these efforts, the CBC has established a Sustainability Team, aligning with its mandate to maintain price stability, safeguard financial stability, and contribute to net-zero carbon emission goals.

By continuing to innovate and adapt, Cyprus is poised to strengthen its position as a leader in the digital economy and financial services, Patsalides concluded.

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Middle East Tensions Cast Uncertainty Over Cyprus Tourism Sector

by THEFUTURE.TEAM

March 11, 2026

Cyprus’ tourism sector is entering a period of heightened uncertainty as regional tensions in the Middle East begin to affect travel sentiment. Although the country is not directly involved in the conflict, industry stakeholders report growing caution among travelers, tour operators and hospitality businesses.

Heightened Concern Across The Sector

Tourism officials and industry representatives are closely monitoring developments. While maintaining a measured public stance, they remain in contact with international partners and travel operators to assess potential changes in travel programs. Despite the uncertainty, many industry figures believe that once tensions ease, targeted marketing campaigns and competitive pricing could help restore Cyprus’ position as a preferred Mediterranean destination.

Operational Adaptations And Labour Considerations

According to reports by Philenews, hotel operators recently met with representatives of the Deputy Ministry of Tourism to discuss the operational challenges emerging from the situation. Labour issues were a central focus of the discussions. Many hotel businesses had originally planned to reopen in March to align with travel agents’ seasonal programs and extend the tourism season. Other establishments had scheduled openings in early April to capitalize on the Easter holiday period for both Catholic and Orthodox travelers.

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Revised Timelines Amid Uncertainty

These plans are now being reassessed. Some hotel operators have proposed extending the full suspension of staff employment for up to two additional months, potentially until the end of April, while awaiting clearer developments in the region.

Such a decision would prolong the current period of unemployment for many tourism workers, highlighting the economic impact the crisis could have on the sector. An alternative proposal involves partial reopening, allowing hotels to operate with only essential personnel based on confirmed bookings. Industry representatives also discussed the possibility of requesting financial assistance from the European Union to offset potential losses.

Mixed Signals For The Summer Season

Despite the uncertainty, travel agents have so far maintained their scheduled flight programs to Cyprus for the summer period, including charter flights between May and October. This suggests that confidence in the destination remains relatively stable among some market segments.

At the same time, hotel operators report cancellations not only for the March–April period but also for certain summer bookings, while demand for new reservations has slowed. Industry stakeholders nevertheless remain hopeful that an easing of regional tensions would quickly restore traveler confidence.

Air Connectivity Gradually Restored

Air connectivity with key markets is also beginning to stabilize. Hermes Airports recently confirmed that several routes between Cyprus and European destinations have resumed. Emirates has restarted flights to Larnaca, strengthening connections with international markets. Haris Papacharalambous, president of the Association of Cyprus Travel and Tourism Agents (ACTTA), noted that the return of routes from the United Kingdom and airlines within the Lufthansa Group is gradually restoring Cyprus’ connectivity with major tourism markets.

While the tourism industry braces for continued volatility, the consensus remains that a swift end to the hostilities in the Middle East is essential for Cyprus to regain its historical vibrancy as a top tourist destination.