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News18
7 hours ago
- Business
- News18
Swiss Bank Rush: Why Indians Are Still Moving Money Abroad Despite Crackdowns
Last Updated: Indian funds in Swiss banks tripled in 2024, reviving black money debate despite Swiss officials denying all such money is illicit The allure of Alpine banks continues. Indian money parked in Swiss banks more than tripled in 2024, rising to 3.5 billion Swiss francs (CHF)—approximately Rs 37,600 crore—according to the Swiss National Bank (SNB). This sharp rise is largely attributed to a surge in funds routed through local branches and other financial institutions. It marks the highest level since 2021, when Indian-linked funds had touched a 14-year high of CHF 3.83 billion. While the overall amount rose significantly, money parked directly in customer accounts grew by only 11%, accounting for just one-tenth of the total. The rebound comes after a steep 70% decline in 2023, which saw Indian funds fall to a four-year low of CHF 1.04 billion. According to SNB data, Indian clients' total funds of CHF 3,545.54 million are spread across various financial channels. Of this, CHF 3.02 billion was held through other banks, CHF 346 million in customer deposit accounts, CHF 41 million through fiduciaries or trusts, and CHF 135 million in bonds and securities. This increase propelled India to the 48th rank in terms of foreign client deposits in Swiss banks, up from 67th in 2023, though still slightly below its 46th rank in 2022. Is All This Black Money? Why Do the Wealthy Still Prefer Swiss Banks? Swiss banks continue to attract high-net-worth individuals globally for reasons beyond secrecy. They offer safety during political or economic instability and access to exclusive investment opportunities. A Swiss account often serves as a ticket to elite investment pools with high entry barriers. Additionally, Switzerland's trust laws are among the most sophisticated globally, helping wealthy families pool and protect their assets through offshore structures. The Swiss franc's stability also shields wealth from currency volatility. Swiss authorities have reinforced that Indian-held assets should not be automatically treated as black money, stating that Switzerland actively supports India in its fight against tax fraud and evasion. India-Switzerland Information Sharing in Place Since 2018, India has been receiving annual account information from Switzerland under the Automatic Exchange of Information (AEOI) framework. The first data exchange occurred in September 2019, and continues regularly, covering accounts with suspected links to financial irregularities. Swiss officials noted that hundreds of such information exchanges have taken place to date. Global Context and Regional Trends While Indian-linked funds rose sharply, total foreign client money in Swiss banks slightly declined to CHF 977 billion in 2024, down from CHF 983 billion in 2023. Indian clients held CHF 1.59 billion at the end of 2023, a 9% year-on-year increase. Among neighbouring countries, Pakistan's deposits declined to CHF 272 million, while Bangladesh saw a steep rise to CHF 589 million. Similar to India, conversations around black money in Swiss accounts remain politically sensitive in both countries.
Time of India
a day ago
- Business
- Time of India
Indian money in Swiss banks jumps more than three time in 2024, hits Rs 37,600 crore, data shows
Indian money parked in Swiss banks more than tripled in 2024, reaching 3.54 billion Swiss francs (around Rs 37,600 crore), the Swiss National Bank (SNB) revealed on Thursday. This is the highest level since 2021. Most of the increase came from funds held through bank channels and other financial entities, not individual customer accounts. Deposits directly from Indian customers rose modestly — up 11% to 346 million Swiss francs (about ₹3,675 crore). These deposits make up just one-tenth of the total Indian-linked funds. According to the SNB, the total CHF 3,545.54 million reflects all liabilities of Swiss banks toward Indian clients. This includes CHF 3.02 billion held through other banks, CHF 346 million in customer accounts, CHF 41 million via fiduciaries or trusts, and CHF 135 million in other instruments like bonds and securities. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like If You Eat Ginger Everyday for 1 Month This is What Happens Tips and Tricks Undo In contrast, these funds had dropped by 70% in 2023, hitting a four-year low of CHF 1.04 billion. The latest rise is therefore seen as a significant rebound, though still short of the all-time high of CHF 6.5 billion in 2006. The SNB data is based on official reports by banks and does not reveal details about alleged black money or accounts held through entities in other countries. Swiss officials have repeatedly said these funds cannot automatically be labelled illicit. Live Events 'Assets held by Indian residents in Switzerland cannot be considered as 'black money',' Swiss authorities have stated. 'Switzerland actively supports India in its fight against tax fraud and evasion.' Switzerland has been sharing annual financial details of Indian residents since 2018 under an automatic exchange of information agreement. The first data transfer to Indian authorities took place in September 2019. Since then, regular information sharing has continued, including on accounts with suspected links to financial irregularities. 'Such exchange of information has taken place in hundreds of cases so far,' according to Swiss officials. While Indian-linked money rose sharply, total foreign client funds in Swiss banks fell slightly to CHF 977 billion in 2024 from CHF 983 billion a year earlier. Indian clients held CHF 1.59 billion in assets by the end of 2023 — an increase of 9% year-on-year. India rose to the 48th spot globally in terms of funds in Swiss banks, up from 67th last year. However, this is still below the 46th rank it held at the end of 2022. Among neighbouring countries, Pakistan saw a dip to CHF 272 million, while Bangladesh's funds rose sharply to CHF 589 million. Like in India, discussions around black money in Swiss accounts are sensitive topics in both countries. Globally, the UK topped the list with CHF 222 billion in Swiss banks, followed by the US (CHF 89 billion) and West Indies (CHF 68 billion). Other top contributors include Germany, France, Hong Kong, Luxembourg, Singapore, Guernsey, and the UAE. Meanwhile, data from the Bank for International Settlements (BIS), which tracks Indian non-bank clients' deposits and loans with Swiss-domiciled banks, also showed an uptick. These funds rose 6% in 2024 to USD 74.8 million (about ₹650 crore). This followed three years of decline — 25% in 2023, 18% in 2022, and over 8% in 2021. At its peak in 2007, BIS data showed Indian deposits exceeding USD 2.3 billion.
