Business Model
Last updated
Last updated
Investors: Small investors all over the world are willing to save and invest but are excluded from financial markets. 1.2 billion people in emerging markets have savings and a smart phone but no or limited access to the banking system, professional investment opportunities (funds, SPV’s) and saving options. Current solutions often need a high minimum investment amount accompanied by expensive transaction fees (charged by 3rd party intermediations, e.g. banks) and are only available in the local currency (risk of instability of the local FIAT currency). The current global financial system is only “global” insofar as certain people in certain countries can access banking and investment products around the world. Most financial products and services are accessible only to wealthy people.
As an alternative to the traditional banking system, cryptocurrencies have grown in popularity to transfer and store money – but they still carry a high risk. At the moment, cryptocurrencies do not represent an adequate solution for a majority of investors due to:
Volatility: Investors are directly exposed to the large price fluctuations of cryptocurrencies.
Third party risks: Even stablecoins, most of which are unregulated and unaudited, are not always stable and users rely on third parties not having fraudulent intentions.
Illegality: Cryptocurrencies are not legally available in many countries - especially in emerging markets.
Financial Products Providers: Expensive client acquisition and customer retention account for a big chunk of the running costs of institutional fund providers worldwide. Due to those high acquisition costs, small investors with a low investment amount are ignored, although the sum of all investors' money can be quite large. Additionally, most fund providers only have limited growth in new markets and new client types.
There is currently an ongoing exclusion of small investors. Limited geographical distribution and high costs per transaction with obsolete systems and processes force providers to ignore private individuals as a target group. Existing intermediaries provide a small level of orders and transferring value – especially across borders – is slow and inconvenient.
Additionally, the current process takes time. New users must fill out an online application form and submit all the KYC documents online. The fund provider then needs to check all the information. If the investor is accepted, the client will receive an email confirmation for their fund account.
Our vision is to change the world of traditional financial markets by creating a new smart-contract-based environment that enables financial trading transactions through a blockchain-based platform. SWIC Digital Gateway bridges the gap between traditional financial products and tokenized assets, and offers the marketplace to support investors, fund providers and various companies.
SWIC Gateway connects investors to investment opportunities using a transaction platform that is fast, efficient, and operating within a fully compliant legal and regulatory framework. In providing this service, a win-win-win situation can be created for the investor (access to financial markets), the fund provider (lower acquisition costs) and SWIC Digital (transaction fees).
Why now? COVID-19 showed the importance of a rainy-day fund and accelerated the use of digital money in cash-driven countries. For example, within 2 years, the number of mobile phone transactions doubled and internet-based transactions more than tripled in our pilot country Sri Lanka. Big trading companies like Robinhood and crypto exchanges like Coinbase had a significant increase in new users. There is a big need for a digital finance solution in non-industrial markets: These people are often exposed to more unstable currencies and higher inflation. A growing number of people flee into cryptocurrencies to send and receive money or store their savings even though they expose themselves to an unregulated space with high risks.
In a world where financial capabilities are often limited by borders, the tokenization of products is a game changer. Our solutions provide a bridge between tried and tested financial assets and the agile world of digital. With tokenized products, we open the door to fractional investing, make participation in traditional markets more flexible and accessible, and create an environment with reduced costs and increased potential for direct trading.
By using blockchain as a fundamental tool, we are increasing efficiency, strengthening transparency and enhancing security across the entire spectrum of financial transactions. This system of innovation not only provides global accessibility, but also embodies a new era of financial inclusion.
With our flexible and robust approach, we enable a single technology base to split into two independent B2C service lines.
The brand we created to help our customers to achieve their saving goals - Tukki
Tukki is an investment and savings app with a long-term focus. Users can either invest directly in professional financial assets or create savings plans. All they need to start is to download the app.
Easy onboarding – done in less than 15min.
Completely free for the user (no recurring or one-off fees)
No minimum investment is required
No bank account is required
Suitable for inexperienced users thanks to the savings goals and the mandatory risk assessment
Investment academy with a guide on how to save and invest
Business model: For each transaction between the User and the Provider, SWIC charges a transaction fee from the provider involved. No fees are assigned to the User.
Brokerage Fees
Description: We charge a brokerage fee of 0.25% of the transaction volume.
Minimum Fee: The minimum brokerage fee is CHF 0.50 per transaction.
Management Fees
Description: We charge a management fee equal to 10% of the management fee of the respective financial product.
The inhabitants of an emerging market country have the following financial advantages through Tukki:
Hedge against domestic inflation
Participation in international economic expansion
Pilot country Sri Lanka: Our pilot country will be Sri Lanka, where we are planning our rollout with our Partner Ataraxia - our local financial product provider. The Central Bank of Sri Lanka has granted us written confirmation to allow SWIC to launch Tukki in Sri Lanka. Our beta launch is planned for the first quarter of 2024 to test the app with real users and make final improvements before the public launch end of spring.
TODO: Include launch stats
With our second service, we want to offer a cheaper and faster alternative to established financial institutions in the securities trading sector in developed markets. The USPs are increased liquidity, lower minimum-investments, lower costs and first-time access to private investors to institutional asset classes.
The aim is to offer the following financial products in tokenized form:
Commodities and precious metals
Investment Funds
Private Equity
Private Debt
Crypto and FIAT money market products
We are currently in the process of creating this second brand.
We will provide a comprehensive software development kit (SDK) along with open-sourcing our APIs (API-key is needed and will be assessed individually), empowering asset managers to call our engine to buy/sell and store tokenized securities on-chain rather than via broker/custodian. This approach ensures flexibility and scalability, catering to the diverse needs of our clientele while fostering innovation and collaboration within the ecosystem.
Business model:
API Fees
Description: We charge a flat fee of CHF 1.0 per transaction executed via our API. (Contracts will be made in ARR and have size-discounts).
Rationale: This fee applies to transactions conducted through our automated trading interface, covering the costs associated with maintaining and providing access to our API services.
We are currently in the process of creating this third brand.
