Funds held by Indian individuals and firms in Swiss banks, including through local branches and other financial institutions, experienced a sharp decline of 70% in 2023, reaching a four-year low of 1.04 billion Swiss Francs (approximately Rs 9,771 crore), according to annual data from Switzerland’s central bank.
This marks the second consecutive year of decline for Indian clients’ aggregate funds in Swiss banks, following a 14-year high of CHF 3.83 billion in 2021. The significant drop was primarily driven by a sharp decrease in funds held through bonds, securities, and various other financial instruments. Additionally, amounts in customer deposit accounts and funds held through other bank branches in India also saw a substantial decline.
These figures, officially reported by banks to the Swiss National Bank (SNB), do not account for the alleged black money held by Indians in Switzerland. They also exclude funds that Indians, Non-Resident Indians (NRIs), or others might have in Swiss banks under third-country entities.
The total liabilities of Swiss banks towards Indian clients at the end of 2023 stood at CHF 1,039.8 million, comprising CHF 310 million in customer deposits (down from CHF 394 million at the end of 2022), CHF 427 million via other banks (down from CHF 1,110 million), CHF 10 million through fiduciaries or trusts (down from CHF 24 million), and CHF 302 million in other amounts due to customers in the form of bonds, securities, and other financial instruments (down from CHF 1,896 million).
Historically, the total amount peaked at nearly 6.5 billion Swiss Francs in 2006 but has mostly trended downward since, except for occasional increases in years like 2011, 2013, 2017, 2020, and 2021.
Falling since two years
The Bank for International Settlements (BIS) locational banking statistics, which both Indian and Swiss authorities consider a more reliable measure of deposits by Indian individuals in Swiss banks, indicated a nearly 25% decline in such funds to USD 70.6 million (Rs 663 crore) in 2023. This follows an 18% drop in 2022 and an over 8% decrease in 2021, after a 39% rise in 2020. The BIS data includes deposits and loans of Indian non-bank clients of Swiss-domiciled banks, having peaked at over USD 2.3 billion at the end of 2007.
Swiss authorities have consistently stated that assets held by Indian residents in Switzerland should not be considered ‘black money.’ They support India in combating tax fraud and evasion. Since 2018, an automatic exchange of information in tax matters between Switzerland and India has been in place, with detailed financial information on Indian residents’ accounts with Swiss financial institutions being provided annually to Indian tax authorities.
