* Swiss authorities plan to speed up asylum process

* Swiss cantons sharing burden under quota system

* Some Swiss fret over taking in more refugees

* EU split on quota proposals, more talks set for this week

By Brenna Hughes Neghaiwi and John Miller

ZURICH, Sept 21 (Reuters) - Amid the chaos and confusion of Europe's migrant crisis, Switzerland is holding itself up as a model for fair and efficient handling of asylum seekers and has drawn praise from the United Nations' refugee agency and Germany's Angela Merkel.

Even in peaceful, consensus-minded Switzerland, however, the issue of asylum seekers is proving politically sensitive and the country's biggest party, the right-wing Swiss People's Party (SVP), remains strongly opposed to any measures that might encourage more refugees, most of whom are Muslim, to come.

The refugee challenge for Switzerland remains much more manageable than for, say, Germany. Far fewer people fleeing conflicts in Syria and elsewhere are currently seeking asylum in the small Alpine nation, which is not a member of the European Union though it is part of Europe's free travel 'Schengen' area.

Under the Swiss system, five refugee centres swiftly sift through asylum applicants and send those most likely to qualify to cantons under a fixed quota while their cases are heard.

In a move to further streamline the process, the Swiss parliament has also recently approved plans to shorten the asylum process for most applicants to less than 140 days while providing them with free legal representation.

"We can show that these accelerated asylum procedures not only work but, thanks to comprehensive legal protection, are actually fair too," Swiss President Simonetta Sommaruga said.

The European Commission is trying to persuade the 28-nation EU to also accept a quota system that would evenly share out the responsibility of accommodating asylum seekers, but faces stiff resistance, especially from ex-communist member states. EU interior ministers will again try to break the deadlock on Tuesday.

Switzerland committed on Friday to take in 1,500 asylum seekers under the EU quota system if it is approved.

Germany, which expects to admit 800,000 refugees this year, gave a nod to the Swiss model last week when Chancellor Merkel's federal government agreed with German regional administrations on distributing refugees across the country and creating a network of centres to facilitate the task.

"A NEW LIFE"

The U.N. High Commissioner for Refugees (UNHCR) has lauded the Swiss approach for its speed and efficiency.

"For persons who are clearly in need of international protection like Syrians, this means faster access to their rights as refugees, to be able to build up a new life in safety and to be reunited with their family members," said spokeswoman Susanne Stahel.

Switzerland may also hold lessons in another area of asylum policy - the prioritising of genuine refugees fleeing danger zones over economic migrants who are just seeking a better life.

Under a policy introduced three years ago, Switzerland processes asylum requests from Balkan countries such as Kosovo and Bosnia within just 48 hours. Most are told they do not qualify as their region is now at peace and they must leave.

Merkel said during a visit to the Swiss capital Berne this month that Germany could learn from such an approach and Berlin has started to clamp down on Balkan applicants to help make way for more deserving candidates from warzones such as Syria.

"If they (the Germans) had these elements of the Swiss system, it's possible that it could provide some relief," said Stefan Frey, spokesman for advocacy group Swiss Refugee Help.

Whatever the merits of the Swiss system, however, the country accounted for only about 3 percent of more than half a million people to seek refuge in Europe so far this year. Just 401 Syrians requested Swiss asylum in August - a month when tens of thousands of Syrians trekked across the Balkans to reach neighbouring Austria and Germany.

"Switzerland's share in European asylum requests is at its lowest in 15 years," said President Sommaruga.

Nevertheless, the number of refugees as of June stood at 38,000, up nearly 20 percent from a year earlier - enough to alarm the right-wing SVP and its supporters in a country which has long struggled to reconcile the humanitarian and the more insular traditions which define the distinctive Swiss identity.

"Despite Switzerland's generosity and humanity, the country is simply too small to fulfil all of the hopes of the people who are seeking a better life here," said Heinz Brand, a SVP lawmaker and immigration expert.

The SVP points out that foreign-born residents now account for about a quarter of the total Swiss population of 8.2 million.

REFERENDUMS

Asked about Switzerland's relative lack of popularity among the new wave of refugees, Swiss officials cite geography - it is simply not on the main routes leading from the Balkans to Germany - and also the lack of a large Syrian community that could create a bigger pull factor as in Germany or Sweden.

The UNHCR has also criticised Switzerland's practice of granting "provisional admission" for many Syrians fleeing war, offering only limited rights to family reunification and access to the labour market - a "very precarious status", the UNHCR's Stahel said.

There is also the Swiss image, reinforced by two referendums, as a country less welcoming to Muslims. In a 2009 referendum Swiss voters backed a ban on the construction of new minarets and in 2014 they approved a plan to curb immigration with a quota system, a decision that put Switzerland at odds with the EU principle of free movement.

"Both have always existed in Switzerland: solidarity and reservations towards foreigners," Sommaruga acknowledged in an interview with a Swiss newspaper.

Asylum seekers taking part in a pilot scheme for the revamped Swiss asylum procedures at a centre in Zurich are unperturbed by such concerns.

"We like it here. The staff treat us nicely, and we can go outside any time we like," said Akalya, 17, a Sri Lankan who arrived with her mother a month ago at the Zurich centre, which provides free schooling for children and activities such as yoga.

Keen to practise the German she is learning in her four-hour lessons, Akalya added: "Wie geht es dir?" (how are you?) (Editing by Michael Shields and Gareth Jones)