Cyprus Central Bank Tightens Safeguarding Rules for Electronic Money Institutions

In a move to strengthen consumer protection, the Central Bank of Cyprus has mandated that all licensed Electronic Money Institutions (EMIs) submit an independent limited‑assurance report on safeguarding client funds for the year ended 31 December 2025, due by 30 September 2026. Safeguarding requires EMIs to keep customer money segregated from their own assets, either in separate accounts at a credit institution or in low‑risk, liquid investments, ensuring that client funds are insulated from the institution’s creditors in case of insolvency. Unlike bank deposit insurance, safeguarding does not offer a guarantee after failure; it relies on continuous controls, reconciliations, and board oversight. The new requirement, carried out by an auditor independent of the institution’s internal audit, aims to raise transparency and trust for businesses increasingly turning to EMIs for digital payments and foreign‑exchange services.