Amid challenges, the outlook for EMIs remains promising
DORA, evolving Central Bank supervision and cyber risk raise the cost of doing this properly, and that is exactly why regulated infrastructure wins.
The Electronic Money Institutions sector is experiencing rapid growth, driven by ever-increasing demand for digital transactions and continuous technological advancement. The outlook remains highly promising, though emerging challenges are shaping a dynamic and demanding landscape.
A growing economy, a growing role
The expansion of the Cypriot economy, projected to grow at about 2.8%, strengthens the sector's momentum. Green growth and digital transformation, supported by the Recovery and Resilience Plan, create favourable conditions for investment in digital payments. EMIs also play a crucial role in attracting foreign direct investment and facilitating multinational companies that prioritise transaction speed, security and reliability.
The challenges are real
- Compliance with new regulation, including DORA and the Central Bank of Cyprus's evolving supervisory framework, requires investment in infrastructure and operational processes.
- The growing threat of cyberattacks makes strengthening cybersecurity a top priority.
- Substantial investment requirements and the need for economies of scale are driving mergers and acquisitions across the sector.
EMIs are increasingly embracing technological innovation and leveraging artificial intelligence to enhance user experience and enable real-time data analysis. Unsurprisingly, they have emerged as key players in the financial sector.
Originally published in Financial Mirror. Read the original article →