Licensing: a sign of quality

On the strength of its official powers, FINMA authorises and licenses all companies that wish to operate in the regulated financial sector. Not all types of licences issued by FINMA involve the same degree of supervision.

FINMA authorises and licenses operation of companies in the regulated sectors. Licensing is a preventive control tool with which the legislator defines the required level of quality that FINMA should apply equally to all financial market participants. Each licence holder must permanently satisfy the licence conditions or risk having their licences revoked.

Licensing differs from case to case

FINMA issues different types of licences. Many companies are subject to intensive prudential supervision after licensing, whereas others are simply granted one-off registration by FINMA for an activity which is not subsequently monitored by FINMA.

Types of licences and intensity of supervision

When making investment decisions, financial market clients should consider the type of licence issued to an institution and intensity of supervision to which it is subjected.

FINMA’s role in licensing 

What FINMA does:

  • FINMA licenses banks, securities dealers and insurance companies, which are then subject to ongoing prudential supervision.
  • FINMA authorises fund management companies, custodian banks, asset managers of collective investment schemes (funds) and representatives of foreign collective investment schemes (funds), which are then subject to ongoing prudential supervision.
  • FINMA authorises Swiss collective investment schemes (funds).
  • FINMA authorises foreign collective investment schemes (funds) which are distributed in or from Switzerland to non-qualified investors.
  • FINMA authorises financial market infrastructures such as stock markets, central counterparties and central securities depositories.
  • FINMA recognises self-regulatory organisations, which monitor asset managers' compliance with money laundering regulations.
  • FINMA authorises financial intermediaries in the non-banking sector that are not affiliated to a self-regulatory organisation. FINMA monitors compliance with money laundering regulations by these financial intermediaries, which are directly subordinated to FINMA.

What FINMA does not do:

  • FINMA does not authorise or supervise non-bank asset managers (if they do not manage collective investment schemes) and investment advisors.
  • FINMA does not license or supervise pension funds.
  • FINMA authorises and supervises directly subordinated financial intermediaries only in the context of the requirements to combat money laundering.