Indian Funds in Swiss Banks Triple in 2024, Driven by Financial Institutions

In a striking shift, Indian money parked in Swiss banks surged over threefold in 2024 to reach CHF 3.5 billion (nearly ₹37,600 crore), primarily driven by a massive jump in holdings through financial institutions and banking channels. According to data released by the Swiss National Bank (SNB), this marks the highest level since 2021, although traditional customer deposits remain a minor component, rising just 11% in the same period.

Why in News?

The Swiss National Bank (SNB) released annual data revealing a dramatic spike in Indian-linked funds. Total liabilities of Swiss banks toward Indian clients increased from CHF 1.04 billion in 2023 to CHF 3.5 billion in 2024. This data comes amid ongoing scrutiny over black money, even as Switzerland and India share tax-related information regularly.

Breakdown of Indian Funds in Swiss Banks (2024)

• Total Indian Funds: CHF 3,545.54 million (~₹37,600 crore)
• Customer Deposits: CHF 346 million (₹3,675 crore) – Up 11%
• Funds via Other Banks: CHF 3.02 billion – A massive rise from CHF 427 million
• Fiduciaries/Trusts: CHF 41 million – Up from CHF 10 million
• Other Financial Instruments: CHF 135 million – Down from CHF 293 million

Trends Over Time

• In 2023, Indian holdings in Swiss banks dropped 70% to a four-year low.
• The latest jump in 2024 reverses this trend dramatically.
• The record high of Indian funds in Swiss banks was in 2006, at CHF 6.5 billion.

Global Ranking

• India’s Rank: Climbed from 67th in 2023 to 48th in 2024 among foreign clients of Swiss banks.

Key Points

• The increase is mostly institutional; individual deposits remain modest.
• Data excludes funds held by Indians via third-country entities, often a channel for tax avoidance.
• BIS data shows a smaller increase (6%) in individual non-bank deposits, indicating more institutional growth.

Regulatory Context

• India receives automatic information exchange from Swiss banks under global tax cooperation frameworks.
• The SNB and the Bank for International Settlements (BIS) provide two different measures of Indian exposure:
• SNB: Includes deposits, loans, securities, and fiduciary funds.
• BIS: Only covers individual deposits and loans from non-bank clients.