Last week, Switzerland’s Federal Council has announced changes in the Banking Act and Banking Ordinance in order to promote FinTechs. With the latest regulatory change, companies with special authorisation can accept public funds of up to CHF 100 million from 1 January 2019, provided they neither invest nor pay interest on these funds.
The most relevant revision of the Banking Ordinance (“Bankenverordnung”) for marketplace lending platforms concerns the restriction of the types of borrowers. Since summer 2018, Article 6 of the Banking Ordinance allowed that public funds up to a total amount of CHF 1 million can be brokered for commercial and industrial purposes. This rule will be extended, allowing also private consumption as a purpose. Consequently, Swiss marketplace lenders will be able to intermediate loans not only for companies (typically SME loans), but also for private customers (typically consumer loans) with more than 20 investors.
In addition to that, the Federal Council also changed the Consumer Credit Ordinance (VKKG). Marketplace lending platforms will be also subject to the Consumer Credit Act (KKG). The SMLA fully supports these changes. As part of the SMLA Code of Conduct, members active in the consumer loan market already comply with the KKG voluntarily.
The Swiss Marketplace Lending Association hascontributed to the discussions on these regulatory changes and welcomes thedevelopment of the FinTech regulation.