Cyprus believes it has found a way to get a bailout without seizing cash from private bank accounts as it attempts to stave off bankruptcy.
News of the so-called 'Plan B' emerged after the European Central Bank (ECB) deployed a deadline on Cyprus, saying it would only guarantee assistance until Monday night without a new aid programme being in place.
The ultimatum, which spooked investors on European stock markets and led to a fall in the value of the euro, was made before President Nicos Anastasiades concluded discussions on a new rescue plan with rival politicians.
It is understood that Cyprus now plans to raise the 5.8bn euros it needs to secure a bailout partly through the creation of a "Investment Solidarity Fund," intended to draw on contributions from ordinary Cypriots, business and foreign investors.
The proposed controversial bank levy - which was rejected by MPs amid a public outcry - was not even reconsidered and a vote on 'Plan B' make take place as early as Thursday evening.
Finance minister Michalis Sarris is continuing talks on possible direct Russian aid through investment in Cypriot banks and energy resources.
He was also seeking an extension to an existing Russian bailout loan.
The troika of lenders - the European Union, European Central Bank and International Monetary Fund - have faced a barrage of protest since news of their demands on Cyprus emerged last Saturday.
The EU is now urging the capital Nicosia to merge struggling banks and impose strict capital controls while it is not clear if Brussels will even accept the alternative aid arrangements.
Queues dozens-deep seeking to withdraw money from cash machines have formed outside Laiki Bank branches and others despite the levy being off the agenda.
Fears of a run on Cypriot banks mean they will have been closed for 10 straight days by next Tuesday - the earliest time they will re-open for business.
The move has inevitably dealt another blow to Cyprus's debt-laden economy, which contracted by 2.3% in 2012, having taken a battering from the global financial crisis and its exposure to Greece.
"We cannot buy, we cannot sell," said Costakis Sophoclides, the director of a frozen goods company in Nicosia.
"A lot of my customers are hotels and restaurants ... and we cannot supply them."
Cash machines still have money available but an overall lack of liquidity has seen petrol stations close their credit card facilities and many stores refuse to accept cheques.
:: Greek Cypriot-born entrepreneur Theo Paphitis will be among the guests on Jeff Randall Live, at 7pm on Sky News.