"The hotel industry will have to strengthen its appeal"

The Société Suisse de crédit hôtelier (SCH), which is co-financed by the Confederation, provides financial support and consulting services to hotels. Its director, Peter Gloor, explains the role and function of the organization.

The SCH supports hoteliers by granting loans at preferential rates, and also by providing consulting services to strengthen the commercial viability and competitiveness of this sector in Switzerland. In 2021, the organization granted CHF 21.2 million to its clients, of which 21.3% went to Graubünden, 20.1% to the Berne region, 18.7% to Eastern Switzerland, and 17.8% to Valais. Central Switzerland (13.4%), French-speaking Switzerland (4.6%), and Ticino (4.1%) received the smallest share of loans. However, the amount is still well below that of the previous year, mainly due to the take-up of COVID-19 loans. After more than two years of health crisis and given the lack of personnel and changes in consumer behavior, the sector will face many challenges in the coming years.

What services and support does the SCH provide and what is its primary role?

Peter Gloor: The SCH is a public law cooperative that, as a competency center, implements the promotion of the hospitality sector within the framework of the Confederation's tourism policy. It grants subsidiary loans to accommodation establishments in tourist regions and thermal resorts. In addition, it offers consulting services to hospitality businesses, tourism companies, banks, public authorities, and other institutions throughout Switzerland. The transfer of knowledge to the hospitality industry completes the scope of the SCH activity.

To whom do you cater?

Gloor: To the Swiss hospitality industry in a global way. These are mainly hotels, usually with at least 15 rooms or 30 beds.

What are the criteria for obtaining your support and advice?

Gloor: Our clients are commercially viable and financially sound hospitality establishments for which low-interest risk capital is used to fill existing financing gaps. SCH participation improves the financial structure of sound establishments and is intended to ensure their long-term profitability.

SCH, therefore, focuses on small and medium-sized hotels in tourist regions that are prone to significant seasonal fluctuations. Our lending is primarily targeted at hotels that have an unfavorable capital structure (low equity), but that may have good return prospects. We evaluate these prospects and grant loans to an establishment, beyond the guarantees required by banks.

In addition, we offer consulting services throughout Switzerland, such as appraisals to determine the yield value according to the DCF method (The "Discounted Cash Flow" method estimates the company’s future capitalized value based on the cash flow it will generate). We also answer questions related to the Federal Law on Secondary Residences (LRS), called Lex Weber, which determines the eligibility of new housing construction and Lex Koller (LFAIE) regulations. This support is aimed at hoteliers, banks, and investors as well as cantonal promotion agencies.

What makes it worthwhile for hoteliers to turn to SCH rather than to a bank or other entity?

Gloor: We don't just provide financing, we complement it. Our co-financing and expertise often serve as a seal of approval for banks, meaning that the project and its feasibility have been vetted by the SCH as a competent agency.

How is the Swiss hotel industry doing after over two years of the pandemic?

Gloor: The impact of the pandemic has been significantly different for each hotel. While cities suffered greatly from restrictions and the absence of business and conference traffic, the more traditional vacation destinations recorded strong figures. And this was mainly due to Swiss travelers. In addition, state subsidies worked well and helped to safeguard liquidity. The SCH also supported its clients by suspending depreciation.

What will the hotel industry's main challenges be in the next few years?

Gloor: Changes in guest behavior will certainly be a major challenge. Many hotels will have to think about digitizing their processes. Moreover, the hotel industry will be faced with a shortage of qualified staff. Employers will therefore have to make the industry more attractive with offers such as four-day weeks or employee housing and leisure offers for staff.

What part will the SCH play in the economic landscape outside the hotel industry?

Gloor: As an instrument of the federal government, the SCH will continue to be involved in the accommodation sector and will base its activities on the corresponding federal law on the promotion of the accommodation sector. This law dates from 2003 and only provides for co-financing in the investment of buildings and walls. With the amendment of the law planned for 2025, the scope of financing should be extended in the future to include the financing of operational procedures or digitalization. In addition, participation in specific impulse programs for accommodation should also be possible. For example, this could be the impulse program for the renovation of accommodation facilities in the Alpine regions, as requested by Stöckli. This would enable us to meet the demands of the industry.



Financial support for accommodation establishments Soft loans Consulting services What criteria Challenges for the Swiss hotel industry Zurich Suisse Zurich Société Suisse de crédit hôtelier (SCH)

After an apprenticeship at the Swiss Bank Corporation (SBC, now UBS), Peter Gloor worked as a financing consultant for various banks. He subsequently became a member of the management and head of corporate clients at the Aargauische Kantonalbank. From the end of 2007, he worked as Head of Financing and Deputy Director of the Société Suisse de crédit hôtelier (SCH), before being appointed Director, replacing Philippe Pasche at the beginning of 2021. Peter Gloor is now 60 years old, married, with two adult children. For many years, he has been active as a civil servant for FC Aarau.

Last modification 17.08.2022

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