Banking in Cyprus

by Barclays Wealth International on April 26, 2010

Moving to Cyprus?

Your guide to expatriate banking services in Southern Cyprus

Introduction

Cyprus, a former British colony, is situated in the eastern Mediterranean, and is the third largest island in the Mediterranean Sea. The official language of Cyprus is Greek, but English is also widely spoken throughout the island.

The island is divided into the internationally recognised Greek Cypriot-controlled Republic of Cyprus (Southern Cyprus) and the self-declared Turkish Republic of Northern Cyprus, recognised only by Turkey.

Before the global financial crisis, Cyprus enjoyed a period of sustained growth, but after the global credit crunch, construction and tourism slowed due to reduced foreign demand.

Cyprus has been a member of the EU since 2004, and the official currency in Cyprus is the euro. As of April 2010, the exchange rate was approximately €1.15 EUR to £1 GBP (pound sterling).

Banks in Cyprus

Central bank

  • Central Bank of Cyprus

Commercial banks in Cyprus

  • Bank of Cyprus
  • Hellenic Bank
  • Laiki Bank
  • Universal Bank

Foreign banks

  • Alpha Bank
  • Barclays
  • BNP Paribas
  • Emporiki Bank
  • National Bank of Greece
  • Russian Commercial Bank
  • Société Générale
  • Piraeus Bank
  • Eurobank

Bank opening times

Typical banking hours are 8.15am to 1pm Monday to Friday and 3pm to 5.30pm on Mondays (1 October to 30 April only). Some branches in tourist areas offer an afternoon service on Tuesdays to Fridays from 3.30pm to 6.30pm. International banks are generally open from 8.30am to 5.30pm.

Banking services in Cyprus

The banking system in Cyprus is well developed, and commercial banking arrangements follow the British model of banking.

Both internet and phone banking services are available from Cypriot banks, and in recent years, banks have extended their services to include insurance, leasing, hire-purchase finance and investment advice and investment products.

The main types of bank account in Cyprus

In general, the Cypriot banks offer the standard banking services and accounts that are found in the UK. The main types of bank accounts offered are;

  • Current accounts – used for daily banking, they typically offer low rates of interest but with easy access to funds. Current accounts may include an ATM/debit card, a chequebook and possibly a credit card on request.
  • Savings accounts – generally offer higher rates of interest than current accounts, but may have limited access to funds, and interest penalties may be incurred for making withdrawals. Savings accounts may offer either fixed or variable rates of interest, and may be fixed for a period of time (e.g. two years)
  • Deposit accounts – typically offer higher interest rates than current or savings accounts, but access to funds may be limited or not available until the maturity date of the account. Deposit accounts may not be suitable if you require regular access to your money.

Many of the large Cypriot banks will offer accounts in a range of major foreign currencies, such as pound sterling or US dollars.

Opening a bank account when you arrive

To open an account with a bank in Cyprus, you will need to provide identification, including:

  • A verified copy of your passport
  • A copy of your residence permit (if applicable)
  • A recent utility bill
  • A letter of reference/employment from your current employer
  • A recent bank statement and letter of reference from your current bank

Opening a bank account before you arrive in Cyprus

You can open a bank account using an overseas branch of any Cypriot bank (or one of the many foreign banks operating in Cyprus). However, your signature and personal identification must be verified before the account can be opened. You can open most types of account before you arrive, including current accounts and foreign currency accounts.

Alternatively, an international account can be opened before you move to Cyprus, and gives you access to a wide range of international banking services. These include secure online banking and offshore banking options, in addition to facilities such as international payments and money transfers and accounts in a range of foreign currencies (including sterling, euro and US dollars).

An international account can help you make a smooth transition from a domestic to an international bank account.

Credit and debit facilities

Debit and credit cards are commonly accepted in major cities and tourist areas. However, in more rural areas cash is the preferred or only available form of payment. International credit cards are widely accepted in tourist centres and in selected hotels, shops and petrol stations.

When using a debit card, withdrawals are usually subject to a daily limit and may attract a charge of up to 2%; cash withdrawals using credit cards can be even more expensive. The use of cheques has declined significantly in recent years, with the exception of cheques issued by businesses, due to the increased use of electronic payments.

Money transfers to and from Cyprus

There are many bureau de change in Cyprus, typically with longer opening hours than banks (particularly at weekends). Most offer competitive exchange rates and low or zero commission, and you can also usually negotiate a better exchange rate for higher transaction values. If you will be resident in Cyprus for an extended period, currency specialists may be able to secure favourable long-term exchange rates, helping to protect your funds from adverse currency fluctuations.

However, the best exchange rates may still be found at a bank, even taking into consideration commission charges. Banks too may be willing to negotiate on fees and exchange rates if you are transferring large amounts of money.

Currency regulations

There are currently no restrictions on the value of currency being imported or exported, providing the following conditions are met:

  • For currency moving inside the EU, amounts exceeding €12,500 EUR or equivalent must be declared to Customs
  • For currency coming from outside/leaving the EU, amounts exceeding €10,000 EUR (or equivalent) must be declared to Customs

Regulations relating to the import and export of currencies are subject to change. Check with the national bank for the latest rules.

SEPA

Cyprus is part of the Single Euro Payments Area (SEPA) initiative. This is a zone for the euro in which all electronic payments are considered to be domestic, thereby making them simpler and cheaper. By the end of 2010, SEPA payments will become the dominant form of electronic payments.

Bank charges

Many Cypriot banks charge for their services, but there is competition between banks to attract new customers, so keep an eye open for special deals and rates for new customers. Individual banks will be able to provide you with a complete charge structure that applies to their products and services.

Banking in Cyprus – other information

One million is displayed as 1.000.000 (instead of the UK format of 1,000,000).

  • Eight and a half percent is displayed as 8,5% (instead of the UK format of 8.5%).

Cypriot ombudsman

If you have any complaints or issues with a bank in Cyprus, you should contact the central bank:

www.centralbank.gov.cy

More information on banking with Barclays Wealth International

For further information about the benefits of opening an International Account before you move to Cyprus, you can speak to a specialist adviser at Barclays Wealth International by calling +44 (0) 141 352 3902.

Alternatively, find out more about the overseas banking services and expat banking that are available from Barclays Wealth International.

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