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Swiss banks want more foreign tax deals

Switzerland should try to reach more deals like those it has signed with Austria, Britain and Germany to stem tax evasion, Geneva's 80-member banking association said on Wednesday.

"Several other countries are interested" in such an arrangement, Bernard Droux, president of the Geneva Financial Center Foundation, told reporters.

Faced with mounting international criticism that its banking practices enable wide-scale tax evasion in other countries, Switzerland has agreed in several cases to ease its cherished bank secrecy, and is negotiating similar agreements with Greece and Italy.

Under the agreements, foreigners that deposit undeclared funds in Switzerland maintain their anonymity but are taxed by Bern, which in turn transfers the revenues to the account holder's country of origin.

"These accords should contribute definitively to resolving the financial problems that have disrupted relations between Switzerland and some of its closest partners," foundation official Edouard Cuende said.

The Swiss economy stood to gain from a clearer arrangement and a subsequent "diplomatic cooling-off", Cuendet added, pointing out that Swiss businesses earned earned about half their profits abroad.

Switzerland's tax deals take effect with Austria and Britain next year, but German lawmakers have yet to ratify the deal between Bern and Berlin, which would see German citizens with assets parked in Swiss banks pay a tax rate of 26.4 per cent on their holdings.

According to German media, between €130 and 180 billion ($170-235 billion) in German assets are hidden in Switzerland.

Even if the German deal fell through, "Switzerland should continue talks with other European states who have already shown an interest," Cuende said.

Droux suggested that France, which has so far refused to discuss a deal on undeclared French funds in Switzerland, would be well-served to think again.

"As our Anglo-Saxon friends say, 'Money talks'," said Droux, who is also managing partner of private bank Lombard Odier Darier Hentsch.

Switzerland manages an estimated 35 percent of global assets, according to Geneva private bank Pictet, the equivalent of $3.0 trillion.

Geneva-based banks manage 40 percent of the total, it said.

The sector employs 34,000 people in the canton which houses 140 banks — around 60 of which are foreign-owned — according to the Geneva Financial Center Foundation.

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Cashless payments in Switzerland: What is Twint and how does it work?

If you live in Switzerland, you are likely no stranger to Twint and maybe even use it regularly to make and receive payments. But if you are not familiar with this app, this is what you should know.

Twint app can be installed on a mobile phone.
“Twinting” money with a smartphone is easy and convenient. Photo by Andrea Piacquadio from Pexels

In Switzerland, the word “Twint” is used both as a noun and a verb.

As a noun, it describes the mobile application which allows you to pay for various goods and services practically everywhere in the country.

As a verb, (“to twint”), it means to send someone money, or receive it, via the same app.

So what exactly is Twint?

Simply put, it is digital cash (not to be confused with bitcoin, which is digital currency) that was first introduced in Switzerland in 2014 and has become very popular since then.

Twint logo. Image by Twint.ch

People like it because it is an easy and quick way to make instantaneous payments, especially in situations when credit cards or physical cash can’t be used.

A big part of its convenience is that it can be used at cash registers, vending machines and parking meters, as well as in online shops — pretty much everywhere in Switzerland, even in places that don’t accept credit cards.

The only similar mode of payment would be your maestro debit card issued by your bank.

This video explains exactly how the process works.

Another advantage of Twint is that you can use it to send money to someone else’s mobile phone — as long as they also have Twint. And you can receive money the same way.

And there are no fees or charges for this service.

How does Twint work?

Anyone can use Twint, but you need a Swiss bank account or a credit card and, of course, a smartphone.

According to Twint website, you need a smartphone with either an iOS (from version 12.2 and upwards) or Android (from version 7 and upwards) operating system and Bluetooth capability (from version 4.0 and upwards).

“It is generally not possible for Twint to be used on Apple devices with an operating system older than “iOS 12.2” or on Android devices with an operating system older than “Android 7”. On Android devices without access to the Google Play Store (e.g. on certain HUAWEI models), the use of Twint app is also not possible”.

But If you have a compatible phone, installing Twint is easy.

Swiss banks offer their own version of the app, and you can download it directly from your bank’s website.

Then, when you use Twint to make a payment, the amount is debited directly from your bank account or credit card.

By the same token, if you receive payment from another Twint user, the money is automatically deposited in your account.

And you are not limited to just one Twint app.

If you have accounts is several banks, or have more than one credit card, you can install and use all of them.

READ MORE: How to open a bank account in Switzerland

Can Twint be used to make payments and receive money from abroad?

For the moment, Twint can be used solely in Switzerland and payments can be made only in Swiss francs – although this may change in future. 

“We are, however, working closely with providers in other countries to develop an international and multi-currency solution”, according to Twint website.

You can find more information about Twint here.

READ MORE: Which bank is best for Americans in Switzerland?

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