Introduction to payments


01
With Europe becoming a tech haven for talent and companies, Cyprus provides a safe and attractive destination for Fintech firms and non-EU investors. For entrepreneurs looking for a European base, Cyprus is an ideal location for international high-tech companies to start their operations and scale-up – and payments are a significant and growing sector.
02
Strategically located at the crossroads of Europe, the Middle East and Africa, Cyprus is an internationally recognised financial centre, with a sound banking sector, a well-established common law system and a highly competitive tax regime. Regulators and competent authorities take a positive pro-business approach to facilitating fintech activity – all of which offers optimal conditions for new and existing players.
03
To encourage the wide transformation of financial services, the Cyprus Exchange & Securities Commission (CySEC) launched the ‘Innovation Hub’ in 2018, a regulatory ‘sandbox’ to enable a seamless transfer of information as to how existing regulation applies to new products or business models, whilst also helping identify what regulatory frameworks might need to be established to meet evolving needs – all without stifling innovation.
04
Cyprus is an EU member state and a eurozone member, allowing for easy EU markets penetration. It has an attractive tax system with an extensive network of double tax treaties. With English as the dominant business language, the availability of qualified, experienced and skilled professionals, and reputable consultancy, audit and legal firms, payments service providers can operate within the EU regulatory framework but with a responsive and experienced regulator and low regulatory fees.

What are payment services?


The relevant Cyprus law regulates the authorisation, operation and supervision of payment institutions carrying out the provided regulated services, which include:

  1. Services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account.
  2. Services enabling cash withdrawals from a payment account as well as all the operations required for operating a payment account.
  3. Execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider:
    • execution of direct debits, including one-off direct debits.
    • execution of payment transactions through a payment card or a similar device.
    • execution of credit transfers, including standing orders.
  4. Execution of payment transactions where the funds are covered by a credit line for a payment service user:
    • execution of direct debits, including one-off direct debits.
    • execution of payment transactions through a payment card or a similar device.
    • execution of credit transfers, including standing orders.
  5. Issuing of payment instruments and/or acquiring of payment transactions.
  6. Money remittance.
  7. Payment initiation services.
  8. Account information services.

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