Switzerland: A Banking & Finance Overview

Background

Switzerland continues to shine as a global leader in banking and finance, blending its storied tradition of stability with cutting-edge innovation. In 2026, certain exciting changes are shaping the sector and enhancing Switzerland's appeal, while ensuring its adherence to the highest international standards.

Regulatory

Overhaul of the regulatory regime

On 10 April 2024, the Federal Council published a report on banking stability that proposed several measures following the Credit Suisse crisis. Key areas include:

• corporate governance;
• capital requirements;
• early intervention;
• crisis liquidity; and
• resolution planning.

Rejected measures include higher leverage ratios, changes to AT1 capital instruments and deposit withdrawal restrictions. The proposed actions focus on enhancing corporate governance laws, introducing a senior managers regime and improving variable compensation regulations.

Additionally, the report suggests stricter capital requirements for parent banks, better early intervention protocols and more robust liquidity management. The Federal Council also recommends diversifying resolution strategies and improving bail-in procedures to ensure financial stability and minimise state intervention risks.

On 26 September 2025, the Federal Council opened the first consultation process, dealing with amendments to the Banking Act and the Capital Adequacy Ordinance. The amendments would require that systemically important banks in Switzerland fully back their holdings in foreign subsidiaries with equity capital in the future. The capital adequacy requirement would increase continuously over a period of seven years

Fintech/crypto-regulations

Switzerland provides a clear regulatory framework for fintech companies, crypto custodians and staking providers based on the principles of:

• “substance over form”; and
• “same business same rules”.

Such framework is currently being reviewed in order to increase legal certainty and boost innovation. The supervision of the Swiss Financial Market Supervisory Authority (“FINMA”) in this area is aimed at balancing innovation with investor protection and market integrity. Fintech companies may benefit from a special “fintech licence” that allows for certain regulatory relaxations to promote technological advancement, and also allows for deposit-taking of up to CHF100 million. Crypto-custodians are required to comply with anti-money laundering regulations, but are otherwise unregulated if the custody is such that a client’s crypto-assets can be segregated in a bankruptcy of the custodian. For staking providers, the regulatory status and treatment depend on the specific way such staking is performed. FINMA’s guidance offers details on these matters, reflecting Switzerland’s commitment to fostering a secure and innovative financial sector.

On 22 October 2025, the Federal Council opened the consultation process on an amendment to the Financial Institutions Act. The Federal Council is proposing two new licensing categories, for "payment institutions" and "crypto-institutions":

• The new licensing category of payment institutions is deemed to replace the existing "fintech licence" with specific changes made to improve attractiveness and customer protection. For example, customer funds should be separable in the event of the institution’s bankruptcy, ie, they should not fall into the bankruptcy estate. In addition, the previous limit on the acceptance of customer funds of CHF100 million will be lifted, which should enable these institutions to grow and benefit from economies of scale. As proposed, payment institutions will also be allowed to issue a special type of stablecoin, subject to specific obligations and anti-money laundering due diligence requirements.
• The new licensing of crypto-institutions is based on those for securities firms, but – as proposed – is less comprehensive, as crypto-institutions do not provide services involving financial instruments. Crypto-institutions and other institutions that provide services involving cryptocurrencies will also have to meet certain requirements to avoid conflicts of interest.

Improvement of anti-money laundering (AML) framework

On 22 May 2024, the Federal Council adopted a bill on the development of the AML framework which seeks to reinforce the integrity and competitiveness of Switzerland as a business hub. Key elements are:

• The establishment of a transparency register for beneficial owners of legal entities, aimed at enhancing law enforcement’s ability to uncover ownership structures. Such register will not be publicly available.
• (Legal) advisers involved in high-risk advisory activities (such as corporate structuring or real estate transactions) will assume AML (due diligence) duties and become subject to AML supervision by a self-regulatory organisation in certain cases.
• Other measures address sanctions evasion and diligence for certain cash transactions.

The measures are in line with international standards and could be enacted in 2026.

Finance

Debt funds and direct lending in or into Switzerland

Even though Switzerland continues to be a stable and reliable banking market, the Swiss market is also an attractive environment for debt funds, offering a combination of:

• economic stability with strong innovation and technology drivers;
• a reliable and efficient regulatory framework; and
• the generally high credit quality of Swiss companies.

Encouraged by banks’ lesser risk appetite, due to higher capital and liquidity requirements combined with increased public and regulatory scrutiny, debt funds and other private debt companies are increasing their share of the Swiss corporate credit market. These funds have become particularly active in the small and mid-cap market and they are prepared to accept higher leverages.

One hurdle for debt funds, however, is Swiss withholding tax, which could be triggered on interest payments under a loan agreement if more than ten so-called non-bank lenders extend credit under the respective instrument. Such risk can be mitigated by:

• structuring specific facilities for banks and non-bank lenders; and
• obtaining tax rulings confirming that each non-bank lender counts as only one non-bank lender and that no look-through approach is applied.

Sustainability in the Swiss loan market

The importance of sustainable financing is set to grow, as Swiss banks commit to initiatives such as the industry-led and UN-supported Net Zero Alliance. Developing a sustainable lending strategy is a crucial component for fulfilling such commitments.

Several Swiss banks are currently active in the sustainability-linked loan (SLL) market. SLLs are loans tied to sustainability targets agreed upon by both the lender and the borrower. These loans can be structured as either bilateral or syndicated, utilising various key performance indicators (KPIs). The most common KPI is the improvement of the borrower’s existing ESG rating. Other targets include enhancing energy efficiency, reducing greenhouse gas emissions and increasing the use of renewable energy, although these are less frequently used.

If the borrower meets the agreed-upon sustainability targets, it usually benefits from a lower interest rate. However, due to the additional costs associated with the set-up and the additional reporting requirements, the potential interest rate reduction is often not the primary motivation for entering into an SLL. Instead, borrowers are typically driven by a genuine intention to transform into more sustainable businesses.

Recent developments regarding stablecoins

On 22 October 2025, the Federal Council of Switzerland (via the State Secretariat for International Finance) launched a public consultation on proposed amendments to Swiss financial-market laws to create a dedicated regulatory regime for “Swiss stablecoins” (ie, tokens pegged to a currency and redeemable) issued in Switzerland. The draft proposes a new licence category for “payment-instrument institutions” issuing stable-value blockchain-based tokens, requiring full backing by high-quality liquid assets, segregated reserves, redemption rights for holders, and advance notification to FINMA. Overall, Switzerland is moving from a largely function-based approach (applying existing laws) towards a dedicated framework that seeks to balance innovation in token-based payments with financial-stability, consumer-protection and AML concerns.