No, not all money deposited by Indians (or linked to India) in Swiss banks is tainted. This is a common myth fueled by political rhetoric and sensational media reports about “black money,” but official data, government statements, and structural realities show a more nuanced picture. 
Current Data (as of 2024/2025 reports):
According to the Swiss National Bank (SNB):
• Total Indian-linked funds/liabilities in Swiss banks rose sharply to ~CHF 3.55 billion (around ₹37,600 crore or ~$4.2 billion) in 2024 — more than tripling from the previous year.
• However, direct customer deposits by Indians were only ~CHF 346 million (₹3,675 crore), about 10% of the total. This saw a modest 11% rise.
• The bulk (~CHF 3.02 billion) was held through other banks, financial institutions, fiduciaries, trusts, bonds, and securities — often institutional or inter-bank flows, not hidden personal stashes. 
Over the longer term, direct Indian customer deposits have declined ~18% over the past decade (from ~CHF 425 million in 2015). 
Legitimate Reasons for Funds in Swiss Banks:
Swiss banks attract money for non-nefarious reasons, especially from a large, growing economy like India’s:
• NRIs and PIOs: Non-Resident Indians and Persons of Indian Origin often hold legitimate savings, pensions, or investments abroad.
• Business and Trade: Indian companies use Swiss banks for international trade, treasury operations, or as a stable financial hub.
• Diversification and Stability: Switzerland offers political neutrality, strong rule of law, privacy (though reduced), and a safe haven during economic volatility, currency risks, or political uncertainty in India.
• Investments: Holdings in securities, wealth management, or as part of global portfolios by high-net-worth individuals and corporations.
• Liberalised Remittance Scheme (LRS): Legitimate outward remittances for investment, education, travel, etc.
Indian government statements (across regimes) have repeatedly clarified that not all deposits can be termed black money. This includes funds by foreign passport holders of Indian origin, NRIs, and compliant resident investments. 
Illicit Money Does Exist — But It’s Not the Whole Story
• Historical Context: Pre-2010s, banking secrecy made Switzerland a popular destination for tax evasion and corruption proceeds. Wild estimates (e.g., $500 billion–$1.4 trillion) circulated but were debunked as exaggerated; actual SNB figures were orders of magnitude lower. 
• Improvements:
• Automatic Exchange of Information (AEOI) via Common Reporting Standard (CRS) since 2018–2019: Switzerland shares account details with India automatically. This makes new evasion much harder. 
• India’s Black Money Act (2015), tax treaties, FATCA, and enforcement actions (e.g., Panama Papers probes) have increased scrutiny and recoveries.
• Undisclosed or illicit funds still exist and get probed when flagged, but assuming the entirety is tainted ignores compliant users and institutional flows.
Why the Perception Persists:
• Political campaigns often amplify “Swiss bank black money” for electoral appeal.
• Media headlines focus on total liabilities surges without context (e.g., inter-bank flows).
• Switzerland’s reputation for discretion lingers, even as transparency has improved significantly.
Bottom line: While some portion is likely illicit (tax evasion, corruption), the majority of the reported figures reflect legitimate financial activity in a globalized world. Blanket claims that “all” Indian money in Swiss banks is tainted are overstated and misleading. India’s tax authorities now have better tools to investigate specific cases through data exchange rather than relying on outdated secrecy myths.