Switzerland Fintech License
In 2017, the Swiss Federal Council's fintech consultation document further clarified and expanded the definition of "bank" under Swiss law to distinguish between the following two types of licenses and various exemption requirements:
Full Banking License
Fintech License ("Light" Banking License)
As the name suggests, the fintech license is a basic version of the banking license. The introduction of this license primarily facilitates virtual currency trading platforms.
Unlike a banking license, a fintech license does not allow for the investment of or payment of interest on client deposits. Licensed companies must record deposits in a manner that is separate from their own funds or recorded separately from their own funds. The latter method requires mandatory auditing.
The fintech license will allow license holders to receive up to 100 million Swiss francs from the public, which cannot be used for investment or to pay interest.
The Swiss fintech license allows for public deposits up to 100 million Swiss francs. If the deposit limit is exceeded, the licensed company must notify the Swiss Financial Market Supervisory Authority (FINMA) within 10 days and submit an application for a Full Banking License within 90 days.
Main application requirements for the Swiss financial license include:
A business plan demonstrating the ability to consistently comply with capital adequacy, risk diversification, and liquidity standards;
Having qualified and experienced management to run the company, with management based in Switzerland;
Providing the company's articles of association, financial organization, main business, and business scope;
The company's main business location must be in Switzerland;
Separation of strategic planning and company management;
Effective risk management policies for identifying, limiting, and monitoring settlement, liquidity, detection, and legal risks;
An effective internal control system, with an internal audit function independent of the executive management;
1. The minimum capital requirement is 3% of public deposit funds, with a minimum of CHF 300,000.
2. Subsequent capital, calculated at 3% of public deposits, must be supplemented up to a maximum of 10,000,000 CHF. The capital must be fully paid, replenished at any time to meet requirements, and cannot be borrowed or invested, only used for company purposes.
The digital currency regulatory "sandbox" established by the Swiss government aims to create a more relaxed environment for Bitcoin startups.
The sandbox allows for the acceptance of customer deposits up to 1,000,000 CHF without any license.
What is "commercially based" acceptance of deposits?
Anyone who neither invests nor pays interest on these deposits can be exempted from being considered as accepting deposits on a "commercial basis."
However, fintech license holders need to inform investors in writing that their deposits are not subject to FINMA regulatory oversight or deposit insurance, to inform customers of the potential risks of their business model.
Once the amount is reached, Finma must be notified and an application submitted. Finma will allow you to continue operations while processing the application to avoid business interruption.
About Oushin
Oushin Overseas Asset Allocation Consulting Company is an international consulting firm established in Europe, primarily assisting clients in countries such as the UK, Ireland, Portugal, Lithuania, Malta, etc., with services including overseas fund establishment, overseas financial license application, overseas company establishment, overseas bank account opening, overseas real estate investment, and second identity planning.
Currently, the company can assist clients in applying for financial licenses including: forex broker licenses, electronic banking licenses, payment licenses, virtual currency trading licenses, and ICO issuance of virtual currency licenses.
