ECB urged eurozone households to invest beyond deposits — Cyprus Mail
The European Central Bank said that eurozone households, including those in Cyprus, keep a significant share of their financial assets in cash and low-yield bank deposits instead of long-term investments. According to Cyprus Mail, around one-third of eurozone household financial assets, valued at nearly €10 trillion, are held in cash and such deposits.
Participation in capital markets
The ECB reported that approximately 80% of eurozone households do not own shares or other market-based financial instruments. Participation in capital markets in the eurozone is significantly lower than in the United States.
Among the wealthiest 20% of households in the United States, more than 65% hold listed shares, bonds or investment fund units. In the eurozone, the corresponding figure is less than 45%, the ECB said.
The regulator identified four main household groups: property owners, those who mainly keep funds in deposits, participants in pension and insurance schemes, and direct investors in capital markets. More than 60% of eurozone households belong to the property-owner category, while about 25% mainly keep funds in deposits. Approximately 10% participate indirectly in financial markets through pension and insurance products, and about 4% are significant direct investors.
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Situation in Cyprus
For Cyprus, this issue is particularly relevant because of the significant sums households keep in bank deposits and the relatively low level of financial literacy. Governor of the Central Bank of Cyprus Christodoulos Patsalides previously said that the country consistently ranks among EU states with the lowest levels of financial awareness, with young people showing the weakest results.
According to the results of a 2023 Organisation for Economic Co-operation and Development survey cited by Patsalides, 58.8% of young people in Cyprus achieved a basic level of financial knowledge. Among people aged 40 to 49, the figure was 80.1%.
The average rate on new household euro deposits in Cyprus fell to 1.27% in July 2026 from 1.42% in June. The average rate in the eurozone was 2.10%.
The ECB identified insufficient financial knowledge, risk perceptions and trust as the main barriers to investing. The bank said that tax incentives, pension mechanisms, simple investment products and financial education can affect investment decisions. Patsalides also called for a separate mandatory financial literacy course to be introduced in Cyprus schools.
