4. January 2023

neon and money – our philosophy

At neon, we know everyone’s looking for a quick & easy Swiss personal account at the moment – and we think it should cost as little as possible from the off, especially if you do lots of the work yourself via an app. That’s why we don’t charge basic fees for our account or card. Other than that, we also try to keep our fees as low as possible, and to be very clear about telling you where we do charge them.

You get two free cash withdrawals a month in Switzerland, and then you’ll just pay 2 CHF for each one after that. Your first neon Mastercard® costs 10 CHF, and if you need a replacement, that’ll set you back 20 CHF. We abolished overseas transaction fees, previously 1.8%, in January 2020, and the same goes for the flat 2 CHF for cash withdrawals. That means, if you want to take out cash overseas, you’ll just pay a fee of 1.5% on the amount in question – and no currency conversion surcharge. That’s something you’d have to pay with other banks, even if it’s often hidden away in a footnote.

How do you make any money, given that neon costs so little?

We make money when people use their card in Switzerland and abroad.

Whenever you make a payment with your card, the merchant pays a small fee (interchange fee), set by the card network (in our case, Mastercard). We get a part of this – for payments in Switzerland, for example, about 0.5% of the amount.

Previously, when you purchased things abroad (online and in-store), you’d have paid a currency conversion surcharge as well as a transaction fee. We got rid of both of them with our fees adjustment in January 2020, so these sources of income have disappeared (or are much lower, as with the Mastercard reference price). This means there’s just the withdrawal fee left to cover our own costs. As you can see, our fees are much lower than most alternatives, and we’ve even reduced them! How are we able to do that? We think our fee adjustment is going to make our neon community bigger: people will be flashing their neon cards everywhere! In turn, these volumes make up for it.

We’re able to do this because we have our costs under control. We’re not burdened by cumbersome structures: neon is a 100% digital, ultra-simple product, without any branches or counters. We collaborate with highly professional (Swiss) partners who are experts in their field and can offer amazing quality at great prices.

We also earn money with selected partner offers. You can find a current listing here:

  • International bank transfers with Wise: Are individually displayed in the app
  • Pillar 3A partner: Up to CHF 150 per completion
  • Investment partners: Up to 150 CHF per completion
  • Insurance partners: A commission for the portfolio (up to CHF 75 per policy)
  • Mortgage consulting partners: Depending on the amount of the mortgage
  • Other offers in our Benefits section: Varying amounts depending on the partner

Apart from the interchange fees and partner offers outlined above, we also earn money with our subscription products neon green and neon metal. And we also earn money with neon invest, our low-cost feature for buying and selling shares and ETFs. There are no kickback fees for neon invest – we earn money with the transaction fees (0.5% of the transaction value for all ETFs and Swiss shares and 1.0% for international shares). With this, we cover the cost for Hypothekarbank Lenzburg AG (e.g. infrastructure, custody, access). An exception are the five 0% fee ETFs that we offer in partnership with Invesco. For these, we waive our transaction fees and instead receive a commission from Invesco that is lower than the transaction fees.

For Leonteq products, we receive a share of the assets under management.

All that means we can be flexible and swift, while getting by with a comparatively small team. Plus, neon doesn’t undertake any risky transactions or pay its managers eye-watering bonuses. In other words, we don’t really need to earn all that much...

Want a better understanding of bank fees as a concept? You can find out more about basic fees, cash withdrawals and more here. 

Spend lots of time abroad or love online shopping? Here are a couple of tips. 

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