Come August 2017, Swiss Federal Council’s new Fintech rules will apply


The Federal Council of Switzerland adopted an amendment of the Banking Ordinance a few days ago, marking August 01, 2017 as the date to implement the new rules regarding Fintech applications.

The revised rules will ensure that the barriers to the market entry of Fintech firms will be reduced and a healthy competitive environment shall be ushered- in, in the Swiss financial circles.

The Ordinance shall apply to Fintech firms that operate outside the normal banking business and shall assess their risk potential in the process of such activities.

The following simplifications are on the anvil:

  1. The exception provided for in the Banking Ordinance for the acceptance of funds for settlement purposes will apply explicitly for settlements within 60 days – in accordance with the practice up to now, a period of seven days applies.
  2. Innovation area will be created: the acceptance of public funds up to CHF 1 million will no longer be classified as operating on a commercial basis in the future and will be exempt from authorisation.

Firms dealing in transactions over CHF 1 million shall be permitted to take a special authorization in the case of public funds, and to that extent, their business models may have to be modified, feels the authority.

The firms shall have to clearly state in their transactions to depositors that their deposits are susceptible to market risks.

It has been stated by the ordinance that the regulations shall apply to both Fintech firms and other established financial service providers.

Furthermore, the amendments have no influence on the applicability of the Anti-Money Laundering Act.

Earlier, another amendment which concerns the Banking Act (BankA) was already addressed by Parliament in the context of the deliberations on the Financial Services Act (FinSA) and the Financial Institutions Act (FinIA).

In December 2016, the Council of States advocated that a new authorisation category is to be created in the BankA for companies that accept public funds of up to a maximum of CHF 100 million but do not invest funds or pay interest on funds.

For the new authorisation category, there should be simplified authorisation and operating requirements relative to the current banking licence in the areas of accounting, auditing and deposit protection.

The debate is to take place this autumn in the National Council.

The Federal Council will continue to closely follow further developments in the areas of digitalisation and Fintech, and examine further regulatory measures.

The corresponding work, i.e. on clarifying the legal qualification of virtual currencies, has been taken over and is to be swiftly pursued.


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