In 2025 Cyprus continues to surprise: according to the European Banking Federation, more than 250 financial companies are registered on the island, and transaction volumes in the electronic money and payment services segment have grown by 37% over the past two years. Why do so many entrepreneurs from the EU, Asia and the CIS choose Cyprus specifically to register financial companies? The answer lies in a unique combination of factors:
- Access to the EU market: Cypriot financial license opens a direct path to the European financial space, allowing you to work with clients from the EU without the need for re-licensing.
- Tax incentives: one of the most attractive corporate tax rates in Europe (12.5%), a developed network of double taxation avoidance agreements, and no dividend tax for non-residents.
- Infrastructure and regulatory support: the Central Bank of Cyprus and other financial services regulators in Cyprus have built a transparent and predictable licensing system, which is especially valuable for startups, fintech companies and international payment services.
- Reputation and flexibility: Cyprus demonstrates consistent compliance with international AML, KYC and GDPR standards, as confirmed by regular reports from FATF and the EU AMLD.
If you are looking for a jurisdiction where you can quickly and transparently launch a financial business, Cyprus: a solution that deserves the utmost attention. In this article I will explain in detail how to obtain a financial license in Cyprus, what nuances to consider and how to avoid common mistakes. I recommend reading to the end – you will receive not only a step-by-step algorithm, but also strategic insights based on COREDO’s experience.
Main types of financial licenses in Cyprus
Cyprus offers several key types of licenses for financial companies:
- EMI (Electronic Money Institution): A license for electronic money in Cyprus allows issuing electronic money, opening customer accounts, making payments and international transfers. It is an optimal choice for fintech startups focused on innovative payment solutions.
- PSP (Payment Service Provider): A license for payment services in Cyprus grants the right to process payments, receive and transfer funds, and work with corporate and private clients, including international payments.
- Money transfer license: Targeted at companies specializing in cross-border transfers, including serving clients from the EU, Asia and the CIS.
- Currency exchange license: Allows legally conducting exchange operations, which is relevant for companies with high turnover and international settlements.
- license to conduct business with cryptocurrencies in Cyprus: The cryptocurrency regulator in Cyprus imposes special requirements for working with digital assets, including mandatory AML compliance and KYC procedures.
Obtaining an EMI license in Cyprus: step-by-step
Preparation for submitting the application
At this stage it is critically important to comply with the requirements of the Central Bank of Cyprus and the Cyprus electronic money regulator. Key points:
- Founders and directors: The regulator requires confirmation of experience in the financial sector, an impeccable business reputation and no criminal records. In COREDO’s practice we recommend forming a board of directors in line with international MiFID and PSD2 standards.
- financial stability: The minimum share capital for an EMI in Cyprus is €350,000. Sources of funds must be transparent and their origin documented. Demonstrating financial stability for an EMI in Cyprus is one of the frequent reasons for regulator queries, so the COREDO team pays special attention to this.
- Business plan and activity development plan for an EMI in Cyprus: The document must include financial forecasts, a description of target markets, an AML/KYC strategy and IT infrastructure development. In one of COREDO’s cases for an EU fintech startup we integrated a detailed risk model into the business plan, which sped up approval by the regulator.
Collection and preparation of documents
The document package includes:
- Passport details and CVs of all participants.
- Business plan, financial forecasts, confirmation of share capital.
- Documents confirming the company’s legitimacy and sources of funding.
- Certificates of no criminal record, bank references.
Submitting the application and interaction with the regulator
The application is submitted to the Central Bank of Cyprus. Payment of state fees for an EMI in Cyprus is made at the same time as the document submission. The processing time for an EMI license in Cyprus usually ranges from 6 to 12 months; however, with proper preparation and active interaction with the regulator this period can be minimized.
Reporting and Audit Requirements for EMI in Cyprus
Reporting deadlines and formats
Every company with an EMI license is required to comply with EMI Cyprus accounting and reporting requirements. Key statements:
- Annual balance sheet, profit and loss statement, cash flow statement.
- Deadlines for submitting financial statements to EMI Cyprus: no later than 6 months after the end of the financial year.
The Cyprus financial services regulator imposes strict requirements on the transparency and completeness of reporting, in line with international EMIR and SFTR standards.
Audit of financial statements
The audit of financial statements for EMI Cyprus is mandatory for all companies, regardless of turnover. Requirements for the EMI Cyprus auditor include having a license within the EU and experience working with financial institutions. The audit opinion must be submitted within the same deadlines as the annual financial statements.
Crypto and Innovation Licensing in Cyprus
License for startups and fintech companies
For a fintech startup, Cyprus offers flexible conditions: a sufficiently substantiated business plan, product innovativeness, and a transparent capital structure. A license for innovative financial products in Cyprus is particularly sought after by teams working with artificial intelligence, blockchain technologies, and digital assets.
License for working with cryptocurrencies and blockchain technologies
The cryptocurrency regulator in Cyprus requires strict compliance with KYC/AML, maintaining separate reporting for digital assets, and regular audits. A license to operate with digital assets in Cyprus and a license to operate with blockchain technologies in Cyprus imply the implementation of in-house or outsourced solutions for transaction monitoring and client identification.
International standards for licenses in Cyprus
AML, KYC and international standards
A license for AML compliance in Cyprus and a license for KYC procedures in Cyprus require implementing policies aligned with FATF, EU AMLD, PSD2, GDPR, MiFID, MiFIR, EMIR and SFTR standards. The Cypriot regulator for international AML standards regularly updates requirements, necessitating ongoing monitoring of changes.
Working with clients from the EU, Asia and the CIS
A Cyprus license for international payments allows working with clients from the EU, Asia and the CIS, but each segment has its own AML/KYC, turnover and risk-profile requirements. Licenses for corporate clients in Cyprus and for private clients in Cyprus require individual tailoring of internal policies.
Practical steps for entrepreneurs
How to minimize risks and speed up the licensing process
- Choosing a reliable legal partner in Cyprus: COREDO’s practice confirms that support from an experienced team significantly reduces the risk of rejection and speeds up the licensing process.
- Preparation of documents and a business plan: The more thoroughly financial models, risks and AML/KYC strategies are developed, the higher the chances of quick approval.
- Interaction with banks and the regulator: Regular communication and transparency in responses to requests from the Central Bank of Cyprus expedite the process and build trust.
Table: Comparison of major financial licenses in Cyprus
| License | Minimum capital | Processing time | Key requirements | Scope of activity |
|---|---|---|---|---|
| EMI | 350 000 € | 6–12 months | Financial stability, business plan, AML/KYC | Electronic money, payments |
| PSP | 125 000 € | 6–12 months | Financial stability, business plan, AML/KYC | Payment services |
| Money transfers | 350 000 € | 6–12 months | Financial stability, business plan, AML/KYC | Money transfers |
| Currency exchange | 350 000 € | 6–12 months | Financial stability, business plan, AML/KYC | Currency exchange |
| Cryptocurrencies | 350 000 € | 6–12 months | Financial stability, business plan, AML/KYC, digital assets | Cryptocurrencies, blockchain |