What Is the Currency of Cyprus? Key Details and Financial Insights

Cyprus is a popular destination for tourism, business, and international investment. Understanding its currency is essential for visitors, expatriates, and anyone engaging in financial transactions within the country.

Official Currency Details

Cyprus adopted the euro (€) as its official currency on January 1, 2008, replacing the Cypriot pound (CYP). This transition was part of the country’s integration into the Eurozone, eliminating exchange rate risks and simplifying trade within the European Union (EU).

Euro banknotes and coins are uniform across all Eurozone countries, but Cypriot euro coins feature unique national designs. The €1 and €2 coins depict the Idol of Pomos, a prehistoric figurine symbolizing the island’s ancient heritage. The 10, 20, and 50-cent coins showcase a Kyrenia ship, representing Cyprus’s maritime history, while the 1, 2, and 5-cent coins feature the mouflon, a wild sheep native to the island. These designs distinguish Cypriot coins from those of other Eurozone nations, though they remain legal tender across the region.

The Central Bank of Cyprus, operating under the European Central Bank (ECB), oversees monetary policy, regulates financial institutions, and enforces EU banking rules. It manages the circulation of euro banknotes and coins while monitoring inflation and economic indicators to align with ECB policies.

Exchange Rate and Conversion

The euro’s value fluctuates against other currencies due to inflation, interest rates, and global economic conditions. Exchange rates with major currencies like the US dollar (USD) and British pound (GBP) are influenced by ECB policies and market trends. Travelers and businesses should monitor these rates, as fluctuations affect purchasing power and transaction costs.

Currency exchange services are available at banks, exchange bureaus, and ATMs. Banks generally offer competitive rates but may charge service fees. Exchange bureaus, especially in tourist areas, provide convenience but often at less favorable rates. ATMs typically use real-time exchange rates from international banking networks, though withdrawal fees may apply.

Digital banking platforms such as Revolut and Wise have gained popularity for currency conversion, offering lower fees than traditional banks. While most businesses in Cyprus accept euros, some tourist-oriented establishments may take foreign currencies, often at poor exchange rates. Credit and debit cards, particularly Visa and Mastercard, are widely accepted, while American Express is available in select locations. Some merchants offer dynamic currency conversion (DCC), allowing customers to pay in their home currency, though the exchange rate is usually less favorable than what the card issuer provides.

Cross-Border Financial Transactions

Cyprus participates in the Single Euro Payments Area (SEPA), which standardizes euro-denominated transfers across European countries. SEPA transfers typically process within one business day and have lower fees than traditional wire transfers. For non-euro transactions, SWIFT transfers are common but may take several days and involve intermediary bank charges.

Businesses must comply with anti-money laundering (AML) and counter-terrorist financing (CTF) regulations set by the Cyprus Securities and Exchange Commission (CySEC) and the Central Bank of Cyprus. Financial institutions conduct due diligence on cross-border transactions, verifying sender and recipient identities to prevent illicit activities. Transfers exceeding €10,000 may be subject to additional scrutiny under EU financial transparency regulations.

Tax residency status affects cross-border income taxation. Cyprus offers a 12.5% corporate tax rate, one of the lowest in the EU, and non-domiciled individuals may receive exemptions on dividend and interest income. Double tax treaties with over 60 countries help prevent double taxation, making Cyprus an attractive jurisdiction for multinational businesses and expatriates managing international assets.

Payment Systems

Cyprus has a well-developed financial infrastructure supporting electronic and digital payments. Contactless card payments are widely accepted, with transactions up to €50 requiring no PIN entry. Most businesses, from supermarkets to small cafés, accept debit and credit cards, and point-of-sale (POS) terminals are now standard due to regulatory requirements for electronic payment options.

Mobile payment solutions such as Apple Pay, Google Pay, and Samsung Pay are increasingly popular, allowing secure transactions via smartphones and smartwatches. These digital wallets use tokenization to enhance security and reduce fraud risks. Local banks also offer mobile banking apps that facilitate peer-to-peer transfers, bill payments, and QR code-based transactions, further reducing reliance on cash.