President Nikos Christodoulides called for more competition in the banking sector so that banks’ financial strength benefits citizens and businesses, speaking at a fintech summit in Limassol on Tuesday. He said that should mean better returns for depositors, easier access to financing and support for productive investment.
Participants at the Forbes Cyprus Next Gen Banking & Fintech Summit agreed that Cyprus has what it takes to become a competitive financial technology hub. However, they said this would not happen automatically.
The summit, held at the Four Seasons hotel, was organised by Phileleftheros in cooperation with Capital S.A. It brought together more than 250 people, including participants from the United States, the United Kingdom, Switzerland, other European countries and the Middle East. Government officials, regulators, bank chiefs, heads of international fintech companies and academics attended. The aim of the event, the first of its kind, was to bring the public and private sectors together with academia to discuss the future of Cyprus in financial technology.
Christodoulides pointed to economic stability and a stronger banking system as key advantages in attracting international investment. He cited growth of about 10 per cent in the Cypriot economy over the past three years, the upgrade of the country’s credit rating and the reduction of public debt. He set the goal of establishing Cyprus as a European fintech hub by making use of its comparative advantages.
Banks win the first round
Costas Markides, a professor at London Business School and the summit’s keynote speaker, said banks had won the first battle with fintech companies. Fintechs had managed to offer faster and easier services, mainly in payments, but had not displaced the big banks, he said.
Banks still dominate core services such as loans and wealth management, and have adapted to the technological changes fintechs brought, Markides said. The future of the financial sector would be a hybrid model in which banks and fintechs coexist, with banks using fintech innovations, but also facing new challenges from technology giants and artificial intelligence.
In an interview with Forbes Cyprus ahead of the summit, Markides said Cyprus could compete with other countries, but not by trying to invest everywhere. It should focus its investment on specific sectors, become faster, strengthen its regulatory framework and draw up a common national strategy with the public and private sectors, he said. That would allow it to concentrate on a few areas where it could gain a real advantage over other countries.
Cooperation the key
Discussions at the summit indicated that Cyprus is not starting from scratch. Participants pointed to a banking system that has become more resilient, a growing technology sector, access to the European market and a reliable environment for investors.
All participants acknowledged that the real challenge for Cyprus is to secure effective cooperation between the state, regulators, banks, fintech firms and academics. The ultimate aim, they said, should be not just adopting new financial technologies but producing and exporting them.
Continuous transformation
In his opening address, Tasos Anastasiou, chief executive of the Phileleftheros Group, spoke about the challenges and opportunities created by rapid technological change. He described the summit as an important initiative at a time when developments are reshaping the financial landscape, and highlighted the international participation and the value of bringing together the state, banks, investors and technology companies.
Anastasiou raised the question of whether Cyprus can develop a competitive fintech ecosystem that attracts international businesses. He stressed the need for banks to transform continuously, citing Bank of Cyprus and its ability to evolve. He placed particular emphasis on artificial intelligence, digital assets and new forms of payment, saying trust and security are essential for digital progress.
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