Many still recall the banking “haircut” of March 2013 during the 2013 Cyprus financial crisis, which reshaped the sector, including the absorption of parts of Laiki Bank by Bank of Cyprus. Further transformation followed, notably in 2018 when Hellenic Bank acquired the Cyprus Cooperative Bank, alongside more recent consolidation activity.
More than a decade later, one might expect a more flexible and competitive banking environment, particularly for corporate onboarding. In practice, however, many Cyprus banks still rely heavily on manual compliance procedures. By contrast, Electronic Money Institutions (EMIs) and fintech providers typically use digital-first onboarding systems, enabling faster Know-Your-Customer (KYC) checks and a more streamlined client experience.
This remains a key challenge for traditional banks. Fully digital onboarding comparable to fintech standards is still remains limited. While some banks offer initial online questionnaires, clients often face delays as application documents are prepared manually, sent for signature, and returned in original hard-copy form, depending on bank-specific requirements.
Some progress has been made. At least one bank has introduced a gateway system for authorised intermediaries, allowing certain documents to be generated automatically, thereby reducing processing time.
Nevertheless, strict Anti-Money Laundering (AML) and KYC requirements continue to shape banking practices. As a result, some banks are cautious or reluctant to work with higher-risk sectors such as cryptocurrency, forex trading, online services, or companies with complex ownership structures. This contributes to lengthy procedures and extensive documentation requirements and increased due diligence timelines.
In contrast, many EMIs:
- Offer near–
- Electronically verify directors, UBOs, and signatories
- Process and validate documents more quickly through digital uploads
Cyprus banks still operate under the legacy of the 2013 crisis, including ongoing heightened regulatory scrutiny. While progress is evident, further investment in digital onboarding and a reassessment of certain de-risking practices may be needed.
Ultimately, businesses must choose between traditional Banks and EMIs based on their needs, services required, and operational profile.
At Eurofast, we support businesses in setting up companies or branches and assist with opening accounts with both EMIs and traditional banks, ensuring full KYC/AML compliance.
For further queries, please, contact us at [email protected]