.svg)
A Swiss parliamentarian has warned that Swiss fintech policy risks backsliding, and called for enhancements to enable growth for both payments and crypto companies and technology.
Swiss lawmaker Andri Silberschmidt has submitted an interpellation to the National Council, urging the government to reform Switzerland’s fintech regulations to improve the country’s global competitiveness.
An interpellation is a formal parliamentary request in Swiss politics that requires the Federal Council to provide written or oral answers to specific policy questions, similar to the systems in place in the European Parliament and UK House of Commons, whereby lawmakers can raise issues with the ministers or governments responsible.
Although it does not directly lead to legislative changes, it serves as a tool for lawmakers to highlight pressing issues, push for government accountability and influence future regulatory decisions.
In this instance, Silberschmidt has argued that Switzerland is losing ground to fintech hubs such as Singapore due to restrictive policies that hinder innovation and business growth.
“The Swiss regulatory framework is a barrier to innovation,” said the politician, who sits with the centrist FDP.
“Switzerland, with its strong financial centre, is not only losing promising value creation potential, but is also undermining the financial sector's capacity for transformation.”
Boosting competition through streamlined regulation
Silberschmidt contends that Switzerland’s existing regulatory framework stifles the sector, making it difficult for fintech firms to compete effectively.
His interpellation calls on the Federal Council to introduce new reforms that would allow the country to reclaim its position as a leading financial innovation and revitalise domestic fintech innovation.
One major area of concern is fintech authorisation, and Silberschmidt, a former banker, is pushing for a regulatory framework that enables fintech firms to provide a full range of digital financial services, including payments, custody and currency exchange, on equal footing with both traditional financial institutions and blockchain-based providers.
In his intervention, Zurich-based Silberschmidt is calling for reforms to the licensing process, arguing that the current system is too slow and lacks transparency.
He proposes setting firm deadlines for the Swiss Financial Market Supervisory Authority (FINMA) to process fintech licences and introducing annual reports to track the number of applications received and approved.
By streamlining licensing procedures, he believes Switzerland can foster a more dynamic and competitive fintech sector.
“Hardly any fintechs are being founded, and those that are are sometimes struggling to survive,” he said. “As a result, even six years after its entry into force, there are only six fintechs, two of which FINMA has already liquidated.”
Ensuring the protection of consumer funds
Silberschmidt also highlights the need for clearer rules regarding the protection of customer funds, questioning whether fintech firms should be required to fully segregate fiat and cryptocurrency holdings and whether these funds should be granted bankruptcy privileges.
Another issue the parliamentarian raises is the ability of fintech firms to pass on interest income or staking rewards to customers without engaging in maturity transformation.
He argues that allowing such practices would enhance the sector’s competitiveness while maintaining financial stability.
In addition, he calls for clearer, more practical regulations for stablecoins, particularly regarding their treatment under Switzerland’s Money Laundering Act (GwG).
He suggests that a transparent regulatory framework, perhaps in the form of a government white paper, could provide both fintechs and the incumbent banks with clearer guidelines for compliance.
The politician also questions the appropriateness of Switzerland’s existing regulatory thresholds, particularly the strict CHF100m ($113m) limit on customer deposits.
He argues that this threshold should be revisited to ensure it is risk-appropriate and does not unfairly hinder smaller fintech firms.
To further support smaller institutions, he suggests that the government explore exemptions to prevent excessive regulatory burdens on startups.
