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Cyprus Launches €31 Million Welfare Reform

Cyprus is rolling out a €31 million reform to modernise its Social Welfare Services, with a focus on strengthening child protection, supporting vulnerable groups and improving the quality and speed of public services.

Speaking on Wednesday, Social Welfare Services Director Maria Kyratzi described the initiative as the first comprehensive overhaul of the country’s welfare system.

“This reform is designed to improve the functioning of the Social Welfare Services while substantially upgrading Cyprus’ social protection system, with social cohesion, equal opportunities and a decent quality of life for all citizens at its core,” she said.

The project is being implemented under the THALIA 2021-2027 Cohesion Policy Programme and is co-financed by the European Union.

Stronger Child Protection And Local Support

The reform will modernise the organisation’s structures, procedures and intervention mechanisms to create a more efficient and people-centred welfare system.

Social Welfare Services currently manage more than 40 programmes and employ over 500 professionals. According to the Deputy Ministry of Social Welfare, rising demand and increasingly complex cases, particularly those involving children under state guardianship, have made the overhaul necessary.

A key measure is the creation of multidisciplinary teams at central and district level to improve the management of complex cases and strengthen cooperation between public agencies. The reform will also introduce escort and mentoring services, together with additional specialist support for vulnerable children.

Since May 2026, the Deputy Ministry has been working with the ministries of education, justice and health on a national child protection strategy and action plan, due to be completed by the end of 2029.

Digital Upgrade

Following a successful pilot phase, the Neighbourhood Social Worker programme will be expanded nationwide in cooperation with municipalities and community clusters, bringing services closer to local communities and strengthening early intervention.

The reform also includes the introduction of a new digital information system to improve efficiency and modernise the delivery of social welfare services.

Cyprus Loan Growth Accelerates To 14% In September

Lending in Cyprus accelerated in September, with the annual growth rate of total loans reaching 14%, up from 11.8% in August. Deposits also recorded a stronger monthly increase, according to the Central Bank of Cyprus (CBC).

Total deposits rose by a net €697.1 million to €60.2 billion at the end of September. Total loans increased by €857.8 million to €29.6 billion, according to the CBC’s October 2026 Monetary and Financial Statistics.

Deposit Growth Strengthens

Deposits recorded a monthly increase of €697.1 million, more than four times the €171.5 million rise in August. However, the annual growth rate remained unchanged at 6.5%.

Deposits held by Cyprus residents increased by €639.9 million. Household deposits rose by €93.8 million, while deposits held by non-financial corporations grew by €373 million. Other domestic sectors contributed a further €173.1 million.

Annual Loan Growth Reaches 14%

Total loans increased by a net €857.8 million in September, compared with €114.6 million in August. The annual growth rate accelerated to 14%, up from 11.8% a month earlier.

Lending to Cyprus residents rose by €470.8 million. Loans to households increased by €52.2 million, while lending to non-financial corporations grew by €110.1 million. Other domestic sectors recorded a larger increase of €308.5 million.

The figures cover deposits and loans held by monetary financial institutions in September 2026.

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