Watch out – deposit insurance does not always apply to online banks – Kassensturz Espresso


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Online banks compete with traditional banks. But how is the money secured with smartphone banks?

Even the names of the new smartphone banks indicate that they are something special: Neon, Yuh, Revolut, Yapeal… to name a few. These neo-banks are increasingly competing with traditional banks. Almost a million people in Switzerland are already using a purely digital bank. This raises the question more and more: How is the money actually secured there if such a fintech goes bankrupt?

Online banks have no branches, no counters, and no longer need paper. Everything runs digitally via an app on the smartphone. It’s cheap and fast. However, most of these smartphone banks do not have their own banking license. This means that they are not directly covered by the deposit insurance. This then jumps in when a bank goes bankrupt. It guarantees CHF 100,000 – per person and bank. It is also called Esisuisse and is a joint venture of the Swiss banks.

Example neon

With 140,000 customers, the largest Swiss smartphone bank is Neon. 700 million francs are currently on the neon accounts. However, the money is not booked with Neon – but with Neon’s partner, the Hypothekarbank Lenzburg.

On the one hand, this is good because the money is covered by the deposit insurance. Only: If a Neon customer already has another account with Hypo Lenzburg, this money and the money in the Neon account are added together for deposit protection. The sum of 100,000 francs is reached faster.

Example Yuh

With fintech Yuh, on the other hand, it is even more special – Yuh is owned equally by Swissquote and Postfinance – but the Yuh money is booked with Swissquote – because Yuh does not have its own banking license either. This means that the Yuh money for deposit protection is added to any other cash accounts with Swissquote. And the secured 100,000 francs are also reached faster.

If, on the other hand, the Yuh customer has additional cash at Postfinance, then 100,000 francs are secured. Even though Yuh owns half of Postfinance. So everything is a bit complicated. The same rules as Neon and Yuh also apply to Zack – owned by Bank Cler – and CSX, owned by Credit Suisse.

example revolution

The situation is different with Revolut. Revolut has half a million customers in Switzerland. The money that is on Revolut is not covered by the deposit insurance. Because Revolut is independent, but does not have a Swiss banking license from the financial market authority Finma. It also doesn’t matter that Swiss customers would deposit their Revolut money into a CS account, says Esisuisse media spokesman Jean-Marc Felix. It is crucial that the Revolut money is not booked with CS.

Example Yapeal

The case of Yapeal is similar: Although Yapeal is a Swiss start-up, it only has a fintech license – and not a full banking license from Finma. This means that the money at Yapeal is not covered by the deposit insurance in the event of Yapeal going bankrupt.

Flow bank example

Flowbank in western Switzerland, on the other hand, has a fully-fledged Swiss banking license. The users’ money is booked directly with Flowbank and is therefore protected by the deposit insurance.

Conclusion of the new banking world: If you want to protect as much cash as possible, you should choose your smartphone bank carefully.

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