Switzerland is best known across the world for three things: its delicious chocolate, its luxury watch brands and its banks. The last one is, by far, what makes this small European country an attractive location for wealthy individuals, companies and other entities that want to keep their money safe. The financial capital of the world, as Switzerland is sometimes dubbed, has even attracted a host of fintech companies using blockchain technologies.
However, Switzerland has not been financially friendly to these companies so far. In order to bridge the gap between crypto-related companies and the access to traditional banking activities, the Swiss Banking Association (SBA) has decided to issue new guidelines for banks that want to offer their services to blockchain startups.
SBA Encourages Banks to Do Business with Blockchain Companies
Until now, banks were not willing to allow cryptocurrency-related companies to deposit their funds, perform day-to-day financial operations, and pay salaries. Their number one worry was breaching the tough anti-money laundering laws and regulations.
Out of a total of 250 banks in Switzerland, only a few of them were willing to allow companies to deposit the cash equivalent of cryptocurrency. The SBA guidelines aim to encourage more banks to take this step forward.
The strategic adviser of the Swiss Banking Association, Adrian Schatzmann said at a news conference:
“We believe that with these guidelines, we’ll be able to establish a basis for discussion between banks and innovative startups, making the dialogue simpler and facilitating the opening of accounts.”
Special Guidelines for Banking Operations with Blockchain Companies
Switzerland is home to 530 blockchain startups and wants to maintain its status as a cryptocurrency and fintech hub. However, lack of access to banking services is a significant problem for these companies.
Banks justify their reticence to do business with blockchain companies because they do not know whether the companies that carry out ICOs perform anti-money-laundering checks on their crypto contributors.
The guidelines issued by the SBA enable the performing of separate verifications at the moment of opening bank accounts by blockchain companies. These checks will be different for companies that carry out ICOs – subject to anti-money laundering risks – and those that do not.
In this way, both banks and blockchain companies will know what type of information they must disclose and what measures they need to take in order to be eligible for opening a bank account.
The head of the Crypto Valley Association, Oliver Bussmann, representing the blockchain startups, welcomed these guidelines, saying: “This provides more clarity not only to banks, but also to startups.”
At the same time, the Deputy Chief Executive of SBA, August Benz, declared that the initial discussion the association had with various Swiss banks were positive, but “it remains to be seen how they will respond to the new guidelines.”