Swiss Federal Council Adopts New Fintech Regulations to Reduce Entry Barriers
- The new rules set a deadline of 60 days for holding money in settlement accounts, facilitating crowdfunding services.
The Swiss Federal Council has adopted new light-touch regulations for Fintech Fintech Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Read this Term firms aimed at bolstering business and competitiveness for the burgeoning sector. They come into force on August 1, 2017.
The London Summit 2017 is coming, get involved!
The amendments to the Banking Act and Banking Ordinance should help reduce barriers to market entry and provide more legal certainty for fintech start-ups, which could eventually enhance the position of the Swiss financial centre.
The new rules set a deadline of 60 days for holding money in settlement accounts, instead of only seven days as was the practice up to now, facilitating Crowdfunding Crowdfunding Crowdfunding is defined as funding of a project via raising smaller denominations of money across a large body of number of people.New businesses that need access to more capital may also conduct crowdfunding. Generally, crowdfunding is performed through an online community, social media, or crowdfunding websites such as Kickstarter, GoFundMe, and RocketHub. Depending upon which jurisdiction an investor resides within will dictate the sort of restrictions that are applied to the crowdfunding pro Crowdfunding is defined as funding of a project via raising smaller denominations of money across a large body of number of people.New businesses that need access to more capital may also conduct crowdfunding. Generally, crowdfunding is performed through an online community, social media, or crowdfunding websites such as Kickstarter, GoFundMe, and RocketHub. Depending upon which jurisdiction an investor resides within will dictate the sort of restrictions that are applied to the crowdfunding pro Read this Term services.
Furthermore, the Swiss authority has created an 'innovation area' in which a provider can accept up to 1 million francs from public funds without being monitored by industry watchdog FINMA.
Explaining this point, the Federal Council said: “The acceptance of public funds up to CHF 1 million should not be classified as operating on a commercial basis and can be exempt from authorisation. This change should allow firms to try out a business model before they are finally required to obtain authorisation in the case of public funds of over CHF 1 million.” It added that investors should be aware that their deposits are not protected by traditional depositor protection systems.
Finally, the Federal Council noted that parliament has already passed amendments to the Banking Act which created better operating requirements, relative to the current banking licence, for institutions which are restricted to taking deposits of up to 100 million francs but do not operate in the lending business.
The Swiss Federal Council has adopted new light-touch regulations for Fintech Fintech Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Read this Term firms aimed at bolstering business and competitiveness for the burgeoning sector. They come into force on August 1, 2017.
The London Summit 2017 is coming, get involved!
The amendments to the Banking Act and Banking Ordinance should help reduce barriers to market entry and provide more legal certainty for fintech start-ups, which could eventually enhance the position of the Swiss financial centre.
The new rules set a deadline of 60 days for holding money in settlement accounts, instead of only seven days as was the practice up to now, facilitating Crowdfunding Crowdfunding Crowdfunding is defined as funding of a project via raising smaller denominations of money across a large body of number of people.New businesses that need access to more capital may also conduct crowdfunding. Generally, crowdfunding is performed through an online community, social media, or crowdfunding websites such as Kickstarter, GoFundMe, and RocketHub. Depending upon which jurisdiction an investor resides within will dictate the sort of restrictions that are applied to the crowdfunding pro Crowdfunding is defined as funding of a project via raising smaller denominations of money across a large body of number of people.New businesses that need access to more capital may also conduct crowdfunding. Generally, crowdfunding is performed through an online community, social media, or crowdfunding websites such as Kickstarter, GoFundMe, and RocketHub. Depending upon which jurisdiction an investor resides within will dictate the sort of restrictions that are applied to the crowdfunding pro Read this Term services.
Furthermore, the Swiss authority has created an 'innovation area' in which a provider can accept up to 1 million francs from public funds without being monitored by industry watchdog FINMA.
Explaining this point, the Federal Council said: “The acceptance of public funds up to CHF 1 million should not be classified as operating on a commercial basis and can be exempt from authorisation. This change should allow firms to try out a business model before they are finally required to obtain authorisation in the case of public funds of over CHF 1 million.” It added that investors should be aware that their deposits are not protected by traditional depositor protection systems.
Finally, the Federal Council noted that parliament has already passed amendments to the Banking Act which created better operating requirements, relative to the current banking licence, for institutions which are restricted to taking deposits of up to 100 million francs but do not operate in the lending business.