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NEXORACYPRUS

Industry Guide

Cyprus for EMI & Payment Businesses

CBC-issued EMI licences with EU passporting, 12.5% CIT, and a rapidly maturing fintech ecosystem make Cyprus a credible EU base for payment and e-money businesses.

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Key Advantages

Why Cyprus for Fintech?

CBC EMI Licensing

The Central Bank of Cyprus (CBC) issues Electronic Money Institution (EMI) and Payment Institution (PI) licences under the EU PSD2 framework, enabling EU-wide passporting from a single authorisation.

EU Passporting Under PSD2

A CBC-licensed EMI or PI can provide payment services across all EU and EEA member states through the passporting mechanism — removing the need for separate national licences in each market.

12.5% CIT

Payment processing income, interchange fees, FX spread income, and management fees from a Cyprus fintech are taxed at 12.5% CIT — one of the lowest rates for regulated financial businesses in the EU.

Strong Regulatory Framework

The CBC is a member of the European Banking Authority (EBA) network. Cyprus meets all PSD2, AMLD, and GDPR requirements — providing the regulatory credibility needed for institutional partnerships.

Access to SEPA and TARGET2

Cyprus-licensed payment institutions have access to SEPA credit transfers, SEPA direct debit, and TARGET2 settlement infrastructure — enabling cost-effective EUR payment processing.

Non-Dom Benefits for Founders

Fintech founders establishing Cyprus tax residency under the non-dom regime pay 0% SDC on dividends. The 50% income tax exemption may also apply to qualifying salaries above €55,000.

At a Glance

Key Tax Numbers

12.5%
Corporate Income Tax
On payment and fintech income
0%
Dividend SDC (Non-Dom)
For non-domiciled founders
27+
EU Passporting Markets
All EU/EEA member states

The Process

How It Works

  1. Incorporate your Cyprus Ltd

    Form a Cyprus private limited company with objects appropriate for EMI, PI, or open banking activities and the required minimum share capital.

  2. Prepare and submit CBC licence application

    Compile the CBC EMI or PI licence application: business plan, AML/KYC policies, IT security assessment, governance framework, and capital adequacy evidence.

  3. Open banking and correspondent relationships

    Set up client money safeguarding accounts with a Cyprus or EU-licensed credit institution as required under PSD2, and establish correspondent banking relationships.

  4. Ongoing regulatory compliance

    File CBC regulatory reports, maintain AML officer, audit annual accounts, and submit CIT returns. We provide ongoing compliance support for licensed entities.

FAQ

Frequently Asked Questions

How long does it take to obtain a Cyprus EMI licence?
CBC EMI licence applications typically take 9–18 months depending on the completeness of the application and CBC workload. Engaging a specialist regulatory adviser to prepare the application significantly reduces processing time.
What is the minimum capital requirement for a Cyprus EMI?
The minimum initial capital for a Cyprus EMI is €350,000. Payment Institutions have a lower threshold of €20,000–€125,000 depending on the services provided.
Can a Cyprus EMI passport into the UK post-Brexit?
No. EU passporting no longer applies to the UK following Brexit. Cyprus EMIs wishing to serve UK customers need separate FCA authorisation or must rely on the FCA Temporary Permissions Regime or overseas firm exemptions.
Does a Cyprus EMI need to safeguard client funds separately?
Yes. PSD2 requires that all client funds be safeguarded in a designated account at a credit institution or invested in low-risk liquid assets — fully segregated from the EMI's own capital.

Related Services

Services relevant to Fintech businesses

Company Formation →Accounting & Tax →

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