Maria Saouri: The Rise of Electronic Money Institutions – What They Mean for Modern Business and Banking

By Maria Saouri | Managing Director, MKS Audit & Consulting Ltd

At MKS Audit & Consulting Ltd, our work places us close to the financial realities of both local and international businesses. Our team of Chartered Certified Accountants, lawyers, industry experts and corporate administrators supports sole entrepreneurs, owner-managed businesses and multinational groups across audit and assurance, accounting, tax, business advisory, and corporate services.Through this work, we have seen how rapidly clients’ expectations of financial services are changing.

Local businesses increasingly value faster access to accounts, digital card management and simpler day-to-day payments. International clients require remote access, cross-border connectivity, transparent transaction tracking and services that support activity across multiple markets. The growth of Electronic Money Institutions (EMIs) has widened the range of options available to both groups.

Why conventional banking can feel limitingConventional banks remain fundamental to the economy, particularly for deposits, lending and broader financial intermediation. However, traditional banking models were largely built for a different operating environment. Businesses can face lengthy onboarding, branch or document-heavy processes, rigid account structures, slower service responses and friction in cross-border payments. For a company operating internationally—or a local business working at digital speed—these delays can become an operational cost.

The issue is not regulation itself—strong regulation is essential. The challenge is how efficiently a financial institution can combine compliance with a responsive, user-friendly service. This is where EMIs have introduced real value.

What EMIs change

An EMI is a regulated financial institution authorised to issue electronic money. Depending on its licence and business model, it may also provide payment accounts, cards, transfers, merchant acquiring and related payment services. Its strength lies in delivering these services through technology-led platforms designed around how people and businesses operate today.

For clients, this can mean remote onboarding, faster payment execution, virtual and physical cards, real-time notifications, clearer transaction visibility and more flexible payment controls. For businesses, it can also mean easier collections, more efficient expense management and payment infrastructure that integrates more naturally with digital operations. EMIs are not removing compliance; they are rebuilding the delivery of financial services around it.

The scale of adoption is significant. European Central Bank data show that the euro area recorded 4.7 billion e-money payment transactions in the first half of 2025—10.7% more than a year earlier—with a total value of approximately €0.3 trillion. This is no longer a niche part of fintech; it is becoming part of mainstream economic activity.

Innovation only works when it is trusted

An EMI is not a bank and should not be presented as one. Under the European framework, EMIs do not accept traditional deposits or use customers’ e-money funds to finance lending. Funds received in exchange for e-money must be safeguarded according to legal requirements.

Technology therefore cannot replace governance. A credible EMI must demonstrate sound internal controls, customer due diligence, anti-money laundering and counter-terrorist financing systems, sanctions screening, transaction monitoring, fraud prevention, data protection, cybersecurity and operational resilience. Clients should assess not only speed and price, but also authorisation, safeguarding arrangements, service quality and the institution’s ability to support them when something goes wrong.

What this means for Cyprus and its businesses

For Cyprus, a country with an internationally oriented business and professional-services sector, EMIs can strengthen payment choice and support companies operating beyond the domestic market. The opportunity is not simply to attract more institutions, but to develop a financial ecosystem recognised for quality, substance and regulatory credibility.

The Central Bank of Cyprus introduced a new pre-application exploratory stage for prospective Payment Institutions and EMIs from 3 August 2026, intended to improve transparency, clarify supervisory expectations and identify material issues earlier. This reinforces an important principle: a licence is not merely permission to enter the market; it is the beginning of an ongoing commitment to responsible growth.

A complementary future

EMIs will not make banks obsolete. Their value is complementary: banks remain central to deposits, lending and wider financial intermediation, while EMIs specialise in how money is issued, accessed and moved. Together, they create a more competitive and responsive financial ecosystem.

From our perspective at MKS, the most important change is not technology alone. It is that local and international businesses now have greater choice. The institutions that earn their trust will be those that combine digital simplicity with financial discipline, innovation with effective controls and commercial ambition with responsibility.

The future of banking will not be defined by technology or tradition alone, but by how successfully the two work together to serve the real needs of modern businesses.

Editorial Source Notes

MKS Audit & Consulting Ltd: Official firm profile, services, client base and team description. Official source

European Central Bank: Payments statistics for the first half of 2025, published 29 January 2026. Official source

European Commission: EU framework and policy information on electronic money. Official source

EUR-Lex: Directive 2009/110/EC on the business and prudential supervision of electronic money institutions. Official source

European Banking Authority: EU operational-resilience framework and DORA materials. Official source

Central Bank of Cyprus: New licensing process for Payment Institutions and EMIs, effective 3 August 2026. Official source