Swiss Regulator Supports Fintech by Amending Rules

Finma, a swiss financial markets watchdog has shown its new initiatives of releasing regulations meant to support fintech’s growth and innovation.

The changes presented include new rules on client oboarding to cover potential video and online customer identification and the introduction of a less onerous licensing category for financial innovators going in hand with a license exempt “sandbox” for start-ups.

Finma states that the adoption of video and online identification serves as an important step towards reducing the obstacles faced by companies in this segment.

The new licensing category, is directed at creating an encouragement for businesses which carry out banking activities but with limited acceptance of client assets and no lending activity.

Finma also stated:

“Because the risks are lower and the scope of business limited, the licensing requirements would be less extensive than for a banking license,”

“For example, financial services providers who do not accept more than CHF 50 million in deposits could apply for this type of financial innovators’ license provided they hold 5% of the deposits and at least CHF 300,000 capital as collateral. The issuance of such licenses would lower the entry threshold for providers of payment systems, applications for managing assets digitally and crowdfunding platforms.”