Cyprus sees largest drop in cash use across the euro area

Cypriots are increasingly favouring digital payment methods, with card transactions now accounting for 75 per cent of total payment volume, the second-highest share in the eurozone after Portugal, according to data released on Monday by the Central Bank of Cyprus (CBC).

Despite the shift, cash and cheques continue to play a role in the domestic payments landscape, even as their use has declined steadily in recent years.

“Cypriots are turning to digital transactions, while at the same time the use of cheques and cash remains significant,” the CBC said.

While cards dominate by volume, credit transfers remain the leading payment method by value, accounting for 84 per cent of total transaction value in Cyprus during the first half of 2025.

Cheques followed with a 6 per cent share, the CBC reported.

The central bank linked the widespread use of cards to their speed and convenience, noting that regulatory changes have also supported the trend.

In particular, the September 2021 decree obliging retail and service-sector businesses to accept card payments has contributed to the steady expansion of card usage.

At the end of the first half of 2025, the number of payment cards in circulation rose by 7 per cent year on year, reaching 2 million, equivalent to an average of two cards per resident.

Debit cards remained dominant, with consumers 84 per cent more likely to hold a debit card than a credit or post-paid card.

According to the European Central Bank’s consumer attitudes towards payments report, Cyprus recorded the largest decline in cash use at points of sale (POS) between 2022 and 2024 among all euro area countries, measured by transaction volume.

The report also showed that 98 per cent of credit transfer volumes in Cyprus were processed electronically, exceeding the euro area average of 94 per cent.

However, the use of direct credit transfers in Cyprus, at 17 per cent, remained below the eurozone average of 21 per cent.

This gap is expected to narrow after September 2025, when all EU payment service providers offering euro credit transfers will be required to also provide direct credit transfers.

The CBC said consumer behaviour also points to a clear distinction between online and in-store card use.

Higher-value transactions are increasingly carried out online, with the average online card payment reaching €125, one of the highest levels in the eurozone.

By contrast, the average card payment at physical points of sale stood at around €37.

Cyprus also ranks well in terms of payment infrastructure, with more than 72 per cent of ATMs supporting contactless transactions, compared with 34 per cent across the euro area.

Cash withdrawals, meanwhile, remain an important self-service option for consumers, mainly via ATMs and, to a lesser extent, cashback services at points of sale.

By category, the largest share of card payment value related to payment institutions, accounting for 14 per cent (€912m) of total card transactions.

Payments to government followed with almost 12 per cent (€768m), while grocery stores and supermarkets ranked third with 11 per cent (€690m).

Online transactions dominated payments to government and payment institutions, accounting for 89 per cent and 100 per cent respectively, while supermarket payments were carried out almost entirely in person (99 per cent).