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FinTechs belonging to this category offer alternative payment services which are supposed to provide a faster and cheaper way for national, European, and international payments for private and business customers by using new technologies.
For example, payment service providers hereby offer solutions to easily integrate several payment services in online shops.
Some FinTechs furthermore provide real cash register systems and online-reservation solutions for restaurants and shops providing their own payment services or making use of the payment services of FinTechs described above.
Introduction
Attitude of the country towards modern payment services
Switzerland has a friendly climate towards modern payment services. The politics is supportive towards the FinTech sector including modern payment services and a number of recent legislative and regulatory initiatives shall strengthen Switzerland's position as a FinTech-Hub. According to a study of the Swiss National Bank (“SNB”) of autumn 2020, the Swiss population has become increasingly aware and appreciative of innovations in the field of cashless payment methods. The usage of mobile payment apps in terms of volume and value has increased from virtually zero (2017) to 5% and 4%, respectively according to the study of the SNB.
Legal affairs
Obligations and requirements to provide payment services or ancillary services described above
Payment service providers who are primarily active in the financial sector and on a professional basis accept deposits or crypto-based assets held in collective custody from more than 20 depositors or solicit deposits or crypto-based assets held in collective custody from the public (even if it receives less than 20 depositions or crypto-based assets held in collective custody as a result from soliciting) in principle need to have a full-fledged banking license from the Swiss Financial Market Supervisory Authority (“FINMA”).
No banking license or a FinTech license is required (regulatory sandbox) if (a) a fintech company holds not more than CHF 1.0 million (approx. USD 1.0 million) as deposits or crypto-based assets held in collective custody, (b) does not engage in any interest rate differential transaction business and (c) does fulfil certain formal requirements. Likewise, no banking license is required if deposits (no limitations apply in regard to the amount) are held for less than 60 days on a settlement account.
Further, financial services providers may accept deposits or crypto-based assets from the public in an aggregate amount not exceeding CHF 100.0 million under a so-called FinTech license (which is a banking license light) if such deposits or crypto-based assets are neither re-invested by the services provider nor earn interest.
Anti-money laundering law obligations only apply to financial intermediaries with a physical presence in Switzerland.
The costs, in particular for obtaining a banking or FinTech License and financial reserves depend on the individual case.
Additional comments regarding the legal situation for payment services or what FinTech’s must be aware of in this business area
Providers of payment services are often subject to the Anti-Money Laundering Act (“AMLA”), including the obligations regarding identification and review of new and existing customers (“KYC”). However, these obligations do not apply if, for example, non-cash transactions are only used for the purchase of goods and services and no more than CHF 1,000 per transaction and no more than CHF 5,000 per person per year is transferred. Further, the due diligence obligations are reduced, for example, if no more than CHF 10,000 per month and person is transferred as a non-