Cyprus is a very attractive location for the provision of financial services and due to its geographical location, it can become the center of European markets. In the “free services” mode in Europe, CIF can provide services throughout Europe with minimal requirements for it.
The tax legislation is very favorable to investment companies making additional investments in setting up investment firms in Cyprus. Financial companies in Cyprus are mostly digitized.
The pandemic and the economic crisis that is taking place around the world have had a significant impact on the financial and fintech markets, respectively. Of course, Cyprus was no exception. First of all, global quarantine has collapsed venture investments in the technological development of the financial market. At the end of the first quarter of 2020, the overall level of investment fell to the 2017 level. The European market dropped significantly. And the recession is still going.
However financial services in Cyprus somewhat became saviors and helped the country to tackle the crisis. Cyprus as you all know is famous for having a large financial industry. Forex brokers tend to be very prevalent in the state. According to this T1Markets review which is a very famous broker in Cyprus, the brokers flourished during the pandemic in Cyprus.
At the same time as has been mentioned above, financial entities in Cyprus are digitized, hence they were not impacted by the coronavirus because they mostly conduct their operations via the Internet. They are very beneficial for the country, bringing considerable revenue by paying taxes. Because of that, the impact of the coronavirus was not visible.
Cyprus financial sector is a stalwart of the country, contributing 20% to Gross Value. They are very resilient and continue to expand throughout the country and more people are contemplating investing in them.
The financial industry is leading the Cyprus economy. Therefore, problems in the financial sector strongly affect the economy of the state as a whole and vice versa. It should be said that Cyprus proved to be a unique country, unlike other ones that were saved by its financial services. Even the United States which is probably the most advanced country in the world had struggles with finances and economy. Cyprus in its turn showed everyone that digitalization is the key to success and without a good banking system and Fintech it is always difficult to talk about any kind of progress.