Ioannis Georgoulas, Chairman of the Association of Cyprus Electronic Money & Payment Institutions (ACEMPI), reflects on the structural shifts reshaping such institutions and argues that the next phase for the sector will be defined less by rivalry with incumbent banks and more by pragmatic collaboration.
In recent years, Cyprus has quietly built a dense and increasingly sophisticated payments ecosystem. According to ACEMPI Chairman Ioannis Georgoulas, three elements have made Cyprus particularly competitive: regulatory credibility, operational flexibility and international orientation. “The Central Bank of Cyprus has shown a strong understanding of fintech and a willingness to engage constructively with Electronic Money and Payment Institutions (EMIs),” Georgoulas notes.
Enhancing clarity
Dedicated supervisory structures have enhanced clarity, predictability and dialogue, which are vital in a fast-evolving regulatory environment. Beyond regulation, Cyprus offers a competitive cost base, access to a multilingual workforce and a quality of life that helps attract talent. On top of that, as an EU member state, institutions licensed in Cyprus benefit from passporting rights across the Single Market while operating under English common law, familiar to international firms. “Combined with a strong professional services ecosystem and a growing payments community represented through ACEMPI, the island punches well above its weight as a payments hub,” he adds.
A pivotal development in 2025 was the ECB’s decision to grant non-bank payment providers direct access to the Eurosystem infrastructure, a framework of systems for instant payments throughout the euro area. For Georgoulas, this was a major milestone. “It narrows the structural gap between banks and EMIs. However, it does not simply ‘level the playing field’; it raises the bar significantly,” he says.
Access brings responsibility, such as governance, risk management, operational resilience, cybersecurity and compliance standards. While weaker players may struggle, mature institutions gain autonomy and smoother correspondent banking relations. “In that sense, this development is positive for the ecosystem. It rewards scale, professionalism and investment in infrastructure, and supports the emergence of stronger, pan-European payment institutions,” he explains.
Intensifying competition
Competition between EMIs and banks is intensifying across Europe. The new entrants tend to be faster, more agile and more technology-driven, while the incumbents retain advantages as regards balance sheets, trust and longstanding customer relationships. Yet the future is not purely competitive, Georgoulas argues. Collaboration through white-label solutions, Banking-as-a-Service, partnerships and shared infrastructure is growing. “In Cyprus, such a hybrid model is practical given the market’s size: EMIs gain scale and stability, banks accelerate innovation and consumers benefit from better services. Success favours those who see cooperation as strategic rather than adversarial,” he says.
PSD3, the forthcoming update to the Payment Services Directive, is likely to formalise and accelerate these trends, aiming to address inconsistencies under its predecessor (PSD2) by strengthening fraud prevention, improving open banking and allowing fairer access to payment systems for non-bank providers. For EMIs, it brings higher compliance costs and greater scrutiny; for banks, more competition but clearer rules for collaboration. “Overall, PSD3 is likely to push both EMIs and banks toward more structured, transparent and technology-driven partnerships,” he says.
Continuous investment
Looking ahead, Georgoulas emphasises that Cyprus must invest continuously in regulatory capacity, digital infrastructure and talent development. Dialogue between regulators, industry and policymakers is essential to keep regulation robust yet proportionate. Cyprus should position itself as a regional hub for innovation, particularly in real-time payments, AI-powered fraud prevention and cross-border services. Collaboration between academia, technology firms and financial institutions will be key, as will promoting financial literacy and trust in digital payments. “Competition is not built only on licences and infrastructure but on confidence from consumers and investors,” Georgoulas highlights. By maintaining a balance between innovation, supervision and collaboration, Cyprus is well-positioned to remain a leading payments jurisdiction in Europe, shaping the future of the sector rather than merely following it.
This interview first appeared in the January edition of GOLD magazine. Click here to view it.
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Athena Yiazou Journalist (: +357 22505558 | 7: +357 22679820 Email: athena.yiazou@imhbusiness.com Web: www.imhbusiness.com Aigaleo 5 | 2057 Strovolos | P.O. Box 21185 | 1503 Nicosia
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