Nicosia, Cyprus. The newly established Cyprus Business Development Organisation is expected to become operational within 12 to 18 months, despite parliament having approved the legislation establishing it earlier this month. The institution will aim to improve access to funding for small and medium-sized enterprises, startups and self-employed professionals.
Board appointment and transition
The next step will be the appointment of the organisation’s seven-member board of directors, which is expected next month.
The initial board will serve for two years in a transitional capacity while the organisation prepares for full operations. This work will include developing financing programmes, lending tools and other financial instruments.
Addressing financing gaps
The organisation is intended to become Cyprus’ first dedicated public development finance institution. It will not operate as another commercial lender but will seek to address financing gaps for businesses facing difficulties obtaining conventional funding.
These may include businesses with limited collateral, shorter operating histories or higher perceived risks. The organisation is intended to complement the banking sector where private financing is unavailable or insufficient.
Mandate and funding
Under the legislation, the organisation will design financing schemes, provide loans and guarantees, and conduct studies to identify weaknesses in Cyprus’ financing market. The findings will be used to shape future support based on unmet demand.
It is also expected to encourage entrepreneurship, strengthen business competitiveness and support investment in innovation, digital transformation and the green transition.
The organisation has received €60 million in initial state capital. It will also be able to fund its activities through its own operations, borrowing from European and international financial institutions, and state guarantees where strategic priorities are approved.