Plans to give very small businesses access to payment accounts with basic features are expected to go before parliament’s plenary, even as ministries, the Central Bank of Cyprus (CBC) and commercial banks continue to raise objections.

The House commerce committee on Thursday closed discussion on two legislative proposals tabled by MPs Costas Costas, Giannakis Gavriel and Andreas Pasiourtidis, after examining them for roughly three years. 

The first proposal seeks to bring very small businesses into the framework governing basic payment accounts, while also introducing rules on the transparency and comparability of related bank charges. 

The second would prevent banks from refusing a consumer’s application for a basic payment account simply because that person already holds such an account at another credit institution. 

Addressing the committee, Costas said the effort to extend the definition of “consumer” to include very small businesses goes back to 2020, when parliament was considering amendments linked to the transposition of a European directive. 

He said the move was postponed at the time after the then commerce minister warned that Cyprus was already facing legal action at European level over delays in bringing the directive into domestic law. 

Lawmakers were subsequently told that the issue would be dealt with through a government bill, Costas said, but no such legislation has yet been submitted. 

However, the proposals have met resistance from several state bodies. 

Representing the finance ministry, Avgi Chrysostomou-Lapathiotis said the changes would place broader obligations on banks in areas already covered by more specialised legislation, much of it tied to EU harmonisation.

She also referred to concerns raised in a note submitted to the committee in January 2025, particularly over whether extending the definition of consumer in this way is compatible with the underlying European directive. 

The consumer protection service, meanwhile, said it is still waiting for the legal service to complete an initial legislative review of the bill. 

CBC’s spokesperson Artemis Nicolaou also questioned whether the proposed changes are necessary in practice, saying it remains unclear how many businesses would actually use such accounts. 

She told the committee that complaints received so far do not appear to justify the need for the regulation, while adding that any measure assigning extra duties to the CBC should first be discussed with the European Central Bank (ECB). 

The banking sector was more direct in its opposition. 

Michalis Kronides, senior director of the banks association, said the proposals would interfere with banks’ freedom to decide who they do business with. 

He warned that lenders could end up being forced to open accounts for businesses they consider high-risk, pointing to cryptocurrency firms as one example. 

Under the existing framework, a payment account with basic features is designed for consumers and covers routine banking needs. 

According to the consumer protection service, those accounts allow services such as deposits, withdrawals, direct debits, card payments, online transactions and credit transfers, as well as the opening, operation and closure of the account itself.