Cyprus was scrambling Thursday to meet a four-day deadline for a bailout for its troubled banks that requires the small EU member to raise billions of euros, DPA reported.
The Cypriot parliament this week strongly rejected a controversial plan for a levy on all bank deposits that sparked widespread anger and has rattled financial markets.
As Cyprus banks stayed shut to avoid a run on cash, long queues formed at bank machines, while many shops and petrol stations refused to accept credit card payments.
Nicosia needs to raise 5.8 billion euros (7.5 billion dollars) to qualify for a 10-billion-euro rescue loan from the EU, ECB and International Monetary Fund.
Political parties agreed with President Nicos Anastasiades to set up an Investment Solidarity Fund that would pool funds from business, ordinary Cypriots and foreign investors.
The island-state's parliament was later set to vote on the fund plan as well as a separate bill on the management of the country's capital, while eurozone finance ministers were expected to hold a conference call on the crisis.
European creditors and the IMF have insisted Cyprus share part of the burden to bail out banks where foreigners, including Russian tycoons, have parked their millions.
Cyprus was also weighing other ideas - seeking help from Russia, a small tax on bank deposits, and dipping into pension funds and assets from Cyprus' wealthy Orthodox church.
The country's Finance Minister Michael Sarris, in Moscow seeking to clinch a deal, ruled out asking for a loan and said help would come in some form of an investment.
"We will have a programme of support for Cyprus by Monday," Bank of Cyprus governor Panicos Demetriades said.
Cyprus banks have been shut since last Friday and are set to remain closed until Tuesday.
Hundreds of protesters descended on parliament after it was announced that under the new plan Cyprus' troubled second-largest lender, Laiki, would be restructured, with assets transferred into a so-called good fund and a bad one.
"Unless the bank is restructured it will go bankrupt - deposits up to 100,000 euros are guaranteed," said the Governor of the Cyprus Central Bank Panikos Demetriades.
The crisis has impacted people's daily lives, for example through shortages of medicine as suppliers were refusing to accept credit from retailers.
There were also reports of cash machines not being refilled and some companies unable to pay their employees' wages.
The president of the eurozone group of finance ministers, Jeroen Dijsselbloem, meanwhile, repeated that Cyprus would have to bear part of the burden of any bailout.
"The eurozone stands ready to deliver that kind of support, but in order for it to be sustainable, there needs to be an element of burden-sharing from the Cypriot side," said Dijsselbloem, who is also the Dutch finance minister.
Analysts say that, without a contribution from Cyprus, any EU-backed bailout would not pass the German parliament, which also has to agree to the rescue plan.
The European Central Bank raised the pressure, saying it would only provide emergency funding for Cyprus' banks until Monday - heightening fears of a financial sector collapse.
After that deadline, "emergency liquidity assistance could only be considered if an European Union/International Monetary Fund programme is in place that would ensure the solvency of the concerned banks," the Frankfurt-based ECB warned.
By mid-morning the ECB's threat sent the eurozone's blue-chip Eurostoxx 50 index down by 0.9 per cent.
The euro, after gaining ground in recent days, slumped 0.2 per cent to 1.2904 dollars.
The Fitch credit rating agency sharply criticized Europe's handling of the Cyprus crisis, arguing that the surprise threat to levy bank deposits undermined confidence in eurozone banks.
It said the unprecedented inclusion of the one-time tax "inevitably increases the danger of contagion risks within the eurozone" and "sets a precedent that depositor bail-in mechanisms are now an acceptable policy tool."
The threat was underscored by a surprise fall in the eurozone's closely watched Purchasing Managers' Index for March.
Fear about Cyprus "raises the prospect of business and consumer confidence falling further across the single currency area," said Chris Williamson, chief economist with the research group Markit, which released the survey.