Online banking services
FinTechs belonging to this area offer traditional banking services in a modern way, usually through online services or mobile applications as well as ancillary services – e.g. enabling customers to manage their giro- or custody-accounts online and in real time or offering e-wallet services. Keywords in this context are also API-Banking or Banking as a Service (BaaS)/ Bank as a Platform (BaaP).
API stands for application programming interface and is offered to access data banks and to extract and insert information. API-Banking consequently means the access to data banks of banks to offer new and innovative banking applications.
Through these services FinTechs offer services with new functions, e.g. enabling customers to manage their accounts online and in real time.
BaaS – Bank as a Service/BaaP – Bank as a Platform:
The API-based Bank as a Service platform has a full banking licence, but merely serves as the back end for standalone independent FinTechs, which “use” the licence and the back end of the bank to offer new financial services, launch additional financial products or expand into additional markets.
Attitude of the country towards online-banking services
Online-banking is very popular in Switzerland and nearly every retail bank active in Switzerland offers online-banking services. According to the Federal Statistics Office, 77% of the Swiss population (between the age of 16 and 74) have made electronic payments (online-banking) in 2021.
Obligations and requirements to provide online-banking services described above
Swiss law does not contain any specific provisions dealing with the forms of online-banking or e-banking as described above. Specific online-banking applications must therefore be assessed according to the general principles for financial services: A full-fledged banking license is triggered, a service provider is primarily active in the financial sector and accepts deposits from the public or publicly its respective services or refinances itself to a considerable extent with several banks in which it does not hold a significant interest, in order to finance for its own account an indefinite number of persons or companies with which it does not form an economic unit (see above).
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.
Additional comments regarding the legal situation for online-banking services or what FinTech’s must be aware of in this business area
Market size for online-banking services and biggest companies in this business area
Currently, only four FinTech licenses (banking license light) are issued by FINMA. However, the market for online-banking services is significant as mentioned above, while the licensing requirements limit the market for services providers offering online-banking services only. Even so-called “smartphone banks” such as neon collaborate with FINMA licensed banks as partners.
Additional comments regarding the economic situation for online-banking services or what FinTech’s must be aware of in this business area