Cyprus is moving ahead with plans to establish a new state-backed institution designed to improve access to finance for local businesses. The Ministry of Finance has placed the draft law for the creation of the Cyprus Business Development Organisation (CBDA) into public consultation until October 19, 2025.

The proposed organisation will operate as a semi-state entity under public law, overseen by a seven-member board appointed by the Council of Ministers. Its main mission will be to strengthen government efforts to enhance access to financing for small and medium-sized enterprises (SMEs), startups, and self-employed individuals, while addressing existing funding gaps in the Cypriot market.

The creation of the CBDA is part of Cyprus’s National Recovery and Resilience Plan, responding to repeated recommendations by the European Commission in its Country-Specific Reports, which have highlighted the country’s limited financing channels for SMEs. The Ministry of Finance aims to submit the bill to Parliament by the end of 2025, with the organisation expected to begin operations in 2026.

According to the draft law, the CBDA will support entrepreneurship, innovation, and competitiveness, promoting digital and green transition initiatives among Cypriot businesses. It will also facilitate access to financing by managing funds, offering loans and guarantees, and investing directly or indirectly in local enterprises.

The organisation will be empowered to design and implement financial schemes, provide grants, issue guarantees for business loans, and even participate in investment funds or companies. It will also be able to borrow and lend money, issue debt instruments, and secure financing from both national and international sources — including EU institutions.

Beyond financial support, the CBDA will offer business advisory services and act as an intermediary for channelling European and national funds toward productive investment.