Cyprus can go from adopting new banking technology to creating it, London Business School professor Costas Markides says, but only if it focuses on the areas where it can build a real advantage.
Markides will give the keynote speech at the first Forbes Cyprus Next Generation Banking & Fintech Summit, at the Four Seasons in Limassol on October 13. He sets out his views in an interview with Forbes Cyprus to be published on Sunday, October 4.
Cyprus cannot win at everything, Markides said, because of its size and the heavy investment involved. Instead, it should concentrate on specific fields such as payments, wealth management, shipping and even artificial intelligence.
Cyprus can compete and succeed, he said, provided it lays the right foundations from the start and correctly judges where and how the state can move. All of this requires a national strategy, under which the government, the relevant authorities, universities, banks and business people agree on shared priorities and stick to them consistently over the coming years.
Central Bank figures
Central Bank of Cyprus data point to a clear shift to digital payments. In the second half of 2025, Cyprus recorded 174 million cashless transactions worth a total of 148 billion euros, up 8 per cent year on year. Card payments made up 75 per cent of them, the highest share in the euro area.
Cyprus recorded the biggest drop in the euro area in the share of cash transactions at points of sale between 2022 and 2024, according to a European Central Bank study cited by the Central Bank. The Central Bank said this reflected consumers’ continuing move towards digital payment methods and a growing preference for paying electronically in everyday transactions.
More than 73 per cent of ATMs in Cyprus support contactless transactions, well above the euro area average of 38 per cent, the Central Bank said. The ATM network itself shrank to 396 machines at the end of 2025 from 398 a year earlier, and has fallen by about 13 per cent over five years.
Bank branches have followed the same trend. A Central Bank study published in March 2026 found there were 19.4 branches per 100,000 inhabitants in 2024, down from 137.3 in 2002. The Central Bank linked the fall to the shift to digital banking, cuts in operating costs and consolidation of the branch network.
AI at Bank of Cyprus
In a long interview with Forbes Cyprus, Dimitris Nicolaou, Director of Digital Transformation at Bank of Cyprus, discusses the rapid move of the Cypriot banking sector from digital banking to AI banking. He explains how the bank’s use of agentic AI and Microsoft Azure AI services is changing its relationship with consumers. An excerpt appears in today’s print edition of Phileleftheros, and the full interview will be published in Forbes Cyprus on October 4.
The panels
The summit’s four panels will look at the technological, business and institutional challenges facing the financial sector.
‘How a Small Island Wins’ will examine what a small economy needs to compete internationally, from regulation and investment to talent, digital infrastructure and cooperation between different ecosystems. ‘AI and the Reinvention of Mainstream Banking’ will look at how artificial intelligence is changing core banking operations, organisations’ decision-making and the customer experience.
‘New Finance / Stack’ will turn to digital assets, payments and the new relationship forming between banks, fintechs and technology companies. ‘Trust and Security in Digital Finance’ will focus on cybersecurity, infrastructure resilience and trust.
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