P2P Lending in Cyprus

August 23rd, 2020
2 minutes read

The Cypriot Market for Crowdfunding and P2P Lending

According to data from the latest report by Cambridge Centre for Alternative Finance (CCFA) on the global market of alternative finance and crowdfunding, Cyprus had a total funding volume of €56.6 million in 2018, up from €10,000 in 2017. Thus, from being almost non-existing in 2017, the Cypriot market for crowdfunding, or more specifically peer-to-peer lending as the current local market is primarily driven by Kviku Finance, seems to be undergoing an interesting development. This development also earned Cyprus a place as number 10 among high-income countries on funding volume per capita with €47.6 raised per capita. On an overall level, Cyprus’ crowdfunding market was ranked as number 17 in Europe and as number 37 worldwide. The countries topping the list in Europe are the United Kingdom, the Netherlands, Germany, France, and Italy.

Best Peer-to-Peer Lending Platforms in Cyprus

Here, you will find a list of the best peer-to-peer lending platforms in Cyprus. When choosing the best peer-to-peer lending sites in a country we consider a variety of factors that you can find in the Methodology below.

Taxation on Peer-to-Peer Loans in Cyprus

In most cases, income from peer-to-peer lending will be treated as passive interest in Cyprus. This means that income from P2P loans will be subject to a tax rate of 30% according to the Special Defence Contribution. There can, however, be exceptions to this, why you should contact a tax adviser when handling your taxes. Also, please note that this should be considered tax advice and might be outdated.

To get a more in-depth overview of the Cypriot tax system for both companies and individuals, we can recommend this tax summary overview made by PwC.

Regulation on Peer-to-Peer Lending and Crowdfunding in Cyprus

Regulation of peer-to-peer in Cyprus is based on general national legislation as there is still a lack of common rules for crowdfunding in the European Union. However, this might change in the foreseeable future as the European Commission in March 2018 presented a proposal for a regulative framework on crowd and P2P finance as part of their Fintech Action Plan. You can read more about the state of crowdfunding regulation in Cyprus in the European Crowdfunding Network Factsheet for Cyprus.

Methodology

At P2PMarketData we are dedicated to providing an unbiased overview of the Peer-to-Peer Lending market and platforms. Among other, in our mission to bring more transparency to the market for online lending we track over 70 platforms funding volumes.

When choosing the best platforms in a country we have considered a variety of factors such as:

  • Number of investors
  • Minimum investment requirement
  • Historical annual returns
  • Diversification opportunities
  • Reinvestment opportunities
  • Educational and informational offerings
  • Platform fees
  • Total capital invested
  • Features (such as secondary market and automatic investing)
  • General transparency (the difficulty of finding who the owners are, how they make money on the platform (fees), terms & conditions and more)
  • Management team

We also look into the company’s online reputation (for example customer reviews, news, complaints, average monthly searches and social media).