Indians funds in Swiss banks jump to Rs 20,700 crores, highest in 13 years

Funds held in Swiss banks by Indians and firms soared to 2.55 billion Swiss francs (over ₹20,700 crores) in 2020. This includes funds through India-based branches and other financial institutions, PTI reported. There was a sharp increase in holdings via securities and similar instruments, though customer deposits fell, the annual data from the central bank of Switzerland revealed on Thursday.

It is the highest level figure observed in 13 years, which reversed a two-year decreasing trend. At the end of 2019, the rise in total funds of Indian clients with Swiss banks was 899 million Swiss francs, ₹6,625 crores.

According to Swiss National Bank (SNB) data, this number stood at a high record of almost 6.5 billion Swiss francs in 2006, after which it has been mainly declining, except for 2011, 2013 and 2017.

The aggregate amount of ₹20,706 crore, which the SNB describes as Swiss banks’ ‘total liabilities’ or ‘amounts due to’ their Indian clients at the end of 2020, includes:

Customer deposits of over ₹4,000 crore (CHF 503.9 million)

Amount held via other banks over ₹3,100 crore (CHF 383 million)

Through fiduciaries or trusts ₹16.5 crore (CHF 2 million )

The highest portion of nearly ₹13,500 crore (CHF 1,664.8 million) as ‘other amounts due to customers’ in the form of bonds, securities and several other financial instruments.

The data also reveals that the money held via other banks rose sharply from CHF 88 million in this period. At the same time, ‘customer account deposits’ have dropped from CHF 550 million at 2019 end and fiduciaries also more than halved from CHF 7.4 million.

The biggest difference can be seen in a rise in ‘other amounts due to customers’ from India, which increased nearly six times from CHF 253 million at the end of 2019, the report added.

The official data reported by banks to the SNB does not indicate the quantum of the much-debated alleged black money held by Indians, NRIs, or others in Swiss banks under the names of third-country entities.

As per SNB, its data for ‘total liabilities’ of Swiss banks towards Indian clients considers all types of funds of Indian customers at Swiss banks, including deposits from individuals, banks and enterprises. This includes data for branches of Swiss banks in India, as also non-deposit liabilities.

The report added that Swiss authorities have always supported assets held by Indian residents in Switzerland, that cannot be considered ‘black money’, and they actively stand with India in its fight against tax fraud and evasion.

Since 2018, there has been an exchange of information in tax matters between Switzerland and India. And under this framework, Switzerland has been actively sharing detailed financial information on all Indian residents suspected of indulging in financial wrongdoings after submission of prima facie evidence. Such an exchange of information has taken place in hundreds of cases so far, PTI reported.

Aggregate customer deposits in all Swiss banks increased to nearly CHF 2 trillion in 2020, including over CHF 600 billion of foreign customer deposits.

While the UK topped the charts for foreign clients’ money in Swiss banks at CHF 377 billion, the US with CHF 152 billion followed at the second spot. Others in the top 10 list were West Indies, France, Hong Kong, Germany, Singapore, Luxembourg, Cayman Islands and Bahamas.

Among BRICS nations, India stood at 51st, below China and Russia, but above South Africa and Brazil. But India was ahead of countries like New Zealand, Norway, Sweden, Denmark, Hungary, Mauritius, Pakistan, Bangladesh and Sri Lanka, the report added.

(Inputs from PTI)

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