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The new Fintech and Start-up hub: Switzerland leading the way

The Swiss Finance Minister, Ueli Maurer has presented recently in Bern his strategy for the Swiss financial centre. Going forward he wants to ensure that the fintech and start-up industry is being provided an optimal legal and political framework with less regulatory hurdles.

Having a history in banking and leading academic institutes like the ETH in Zürich or the HEC in Lausanne, Switzerland offers ideal conditions for a fintech hub. Switzerland is host and home of wealthy individuals but also wealthy fintech and start-up investors. However, London, New York or Singapore have flourished instead. Until now, the fintech industry as lacked a political representative and a vocal supporter. Ueli Maurer, the Swiss Finance Minister has emerged as Switzerland’s fintech industry promoter.

 Flourishing conditions for Fintechs and Start-ups in Switzerland

Ueli Maurer wants to move forward with his statement by allowing “innovation-friendly framework conditions” in the sector of fintech and start-ups. During a recent news conference, he said “We want to remain among the most important players in this sector”. “It is a legal framework that is competitive in an international context, “added the Swiss State Secretary for International Financial Matters. He has announced that Switzerland was breaking new grounds with conditions that could not be found in any other country.

Swiss Fintech having now an eloquent backer has articulated at the highest levels of the Swiss government goals and plans. A series of measures will be therefore introduced in order to promote fintech start-ups. Maurer wants to establish a license for fintech firms, which would enable them to accept funds of clients but would remain outside the usual depositor protection scheme. A “sandbox” was proposed by the government to be set up for fintechs, where their developed technology could be run and tested in a live environment without being regulated by the Swiss Financial Regulation (FINMA).

Growing demand for Fintechs also from developing countries

The below illustrations shows an international comparison of countries and their usage of non-traditional financial services or non-traditional firms. Turkey, Singapore, Spain, order levitra without prescription Hong Kong, UAE, India and China are amongst those countries where more than 50% of the population uses the service of more than one non-traditional financial service firm or any type of non-traditional company. Fintechs are therefore in phase of upswing as young and technology-oriented users and customers, which is 50% of all users worldwide according to the World Fintech Report (WFTR).

 

Customers Using at least one non-traditional firm or financial services by country (%), 2016

graph

Source: Capgemini Financial Services Analysis, Capgemini and LinkedIn WFTR Voice of the Customer Survey 2016

 

Switzerland is vying for the attention of Fintechs and Start-ups

Having the back-up of the Swiss Financial Regulation, the door for innovative players will be easier to open than previously. Xapo, a Swiss developed crypto hub was established after Bitcoin, which headquarters have been moved recently to Switzerland. Another international collaborative player, Opportunity Network, an international exclusive peer-to-peer and direct investment platform has recently established among other global offices a representation in Zürich.

The fintech movement is sweeping with strong supporters and finally having a voice through the financial services industry, giving a boost to market participants but also promising deep changes within the sector. Time will tell and 2017 will be a crucial year for Switzerland to prove itself as a global incubator of innovative solutions in the fintech and start-up industry.

 

About the Author

Marta Ra, Managing Director Switzerland, Opportunity Network

Based in Zurich, Marta is developing the Swiss market for Opportunity Network. Before joining Opportunity Network, Marta worked at Morgan Stanley, Deutsche Bank and JP Morgan. She holds a phd in Risk Management from the University of St. Gallen.

 

About the Company

Opportunity Network is a members-only business matchmaking platform that enables CEOs of middle market companies, Family Offices, and HNWIs to share and connect to business opportunities worldwide. We connect members to business opportunities such as M&A, commercial partnerships, and capital raise/deploy that are at least $1M. Our goal is to promote global economic growth through bank partnerships and by providing foreign market access.

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