Swiss Banks still popular among Indians

The prestigious Swiss banks have always had some suspicion surrounding them. They pay next to nothing on deposits, and they even charge a fee for holding people’s money.

Swiss banks are also famous for their secrecy, but the facts have started to slip through. One of the Swiss banks’ most prized set of clients is the rich people of India.

However, these rich Indians are being watched under the government’s eye like never before. Yet, while some of the money in Swiss banks might be dirty, some of it is genuine. Most of all, it is the safety of this money that attracts people to these banks.

Last week, the Swiss National Bank released incredible, baffling numbers. After falling over a period of three years, there has been a 50% rise in the money put there by Indians in 2017.

This has totaled to 1.01 billion Swiss francs, which is about ₹7,000 crore. Part of the attractiveness of Swiss banks comes from the relative stability of the country’s currency, which protects its value from any swings in the foreign exchange market.

Also, Switzerland’s trust laws are probably the best for pooling and ring-fencing family wealth. There is some truth in Finance Minister Arun Jaitley’s statement that not all Swiss bank money is dirty.

However, there is a good chance that there is far more than ₹7,000 crore worth of Indian money stored in Swiss banks.

Although India and Switzerland signed a pact to share information on accounts that were active on or after January 1st, 2011, it is likely that many people removed their money from Swiss banks before the pact signing. They would have then stored them in other places for the time being.

Over the last five years, some of this money has probably returned to trusted Swiss banks. However, this money is not counted along with the rest of the Indian money in these banks.

It would be hard to discover this money trail. Yet it cannot be denied that much of the Indian money in Swiss banks is actually genuine. Therefore, it is a decision of priorities whether to protect the genuine money or root out the corrupt money.

Photo by Jerry Wang on Unsplash (Free for commercial use)

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