The Swiss Investment Banking Giant, UBS Group, has announced that it had created a new venture capital fund, using a corpus of hundreds of millions of USD of its own funding.

UBS Aims To Fund Fintech

The venture fund was developed with the goal of exclusively backing fintech projects that fall under the three broad categories: Investing and financing platforms, client management, and improving a bank’s underlying operations.

The banking giant has already started the process of screening for various potential companies to invest in, within this sector. As it stands now, the fund is planned to make investments ranging from $10 million to $20 million across dozens of companies.

The publication cited a person that is claimed to be “familiar” with the subject matter, and outlined that the bank is planning to hold its investments for a minimum of five years.

Building Up For Innovation And Digitization

It should be noted that UBS is still in the process of hiring and building the team that will take responsibility for handling these venture investments.

Mike Dargan, the Global Head of Group Technology, gave a statement to the publication about the matter at large. He explained that UBS wants to engage with, as well as support fintech firms, to a further degree. With this new venture investment portfolio, Dargan said, the company can take the next step in order to accelerate UBS’ digitization and innovation efforts.

The Many Competitors

This new move from the Swiss bank into the venture capital space came after Ralph Hamers took charge of the bank, having done so in October of last year. Hamers himself is an advocate of digital banking as a whole, and the COVID-19 outbreak is making it an attractive option for many banks, as well. With many countries in lockdown and stay-at-home orders, businesses across the globe have started to shift towards digital services.

While UBS itself has only begun its process of staking in various fintech companies, the Swiss bank’s America-based rivals have already established themselves in the industry. Even Credit Suisse, a bank headquartered in Zurich, has already established its presence in investing with fintech startups, doing so through its entrepreneur capital arm.

Bloomberg further highlighted that UBS is aiming to tap into the Chinese market, and is currently trying to obtain a digital fund distribution license for just that.