IFZ Fintech Study 2017
The efforts of the federal government and the collaboration of companies could make Switzerland the world’s leading fintech hub – as long as there are experts, investors and niche markets.
Text: Christoph Widmer,
After Singapore, Switzerland offers the world’s best prerequisites for fintech firms. That is the conclusion of the Institute for Financial Services (IFZ) and the fintech study it carried out this year: The competence centre based in Zug carried out a comprehensive analysis of the fintech sector in Switzerland – and concluded that Switzerland has great potential as a location.
At the end of 2016, the IFZ surveyed 190 Swiss fintech companies – 17 percent more than the year before. The number of companies involved increased, particularly in the credit and deposit industry, followed by the sectors of banking infrastructure, blockchain and cryptocurrencies.
“The number of companies involved increased, particularly in the credit and deposit industry, followed by the sectors of banking infrastructure, blockchain and cryptocurrencies.”
The study states that early signs that the Swiss fintech market has good chances were visible in 2015. The sector is now showing additional growth and the reason is consistent collaboration. State bodies are working on putting together a fintech framework, for example. The Federal Council would like to ease regulations in order to reduce the barriers faced by future fintech providers trying to enter the market. The aim is to make Switzerland a more attractive and even more competitive financial centre.
Digital ecosystems are the key to success for the future of banking.
Leiter Think Tank e-foresight
According to the study, collaboration between start-ups was another factor contributing to the growth of the fintech market. For young companies in particular, the conditions in Switzerland are optimum. The financial landscape of the country does not have enough to offer growing companies, however. As announced by the IFZ in its study last year, more and more Swiss fintech companies are tapping into foreign markets. In doing so, they benefit from foreign venture capitalists and specialists – bypassing the current dearth of experts in Switzerland’s technology sector.
The Swiss fintech sector does not represent a risk to the banking industry: many fintech companies collaborate with banks and are getting more and more involved in the areas of SaaS or licence fees. Established banks earn their income, however, from commission fees, trading and interest.
“Many fintech companies collaborate with banks and are getting more and more involved in the areas of SaaS or licence fees.”
Most Swiss fintech firms are expanding, thanks to the B2B business with financial institutions, while the country’s banks are increasingly turning to foreign fintech providers. There is only one course open to Swiss fintech companies: they have to specialise. Only companies that serve a niche market can keep up with global competition. Here is how Sascha Gysel, manager of Swisscom’s digital banking think-tank e-foresight, sees the issue: “With experts and capital – including from abroad – Switzerland can establish itself as a worldwide competence centre for fintech.”
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