Can you only have 12 games on the switch

After going through all of the options on the console, the firm answer is: No.

I highly doubt Nintendo would ever offer the option to install from the Game Cards. They are already way faster than optical discs, so that isn't an argument. Frankly they'd rather make it harder to pirate games by forcing the need of the Game Card than make it easier for individuals with many physical purchases.

Sort of? It's a bit of a complicated process. (It's nothing like any sort of Family Sharing or what have you that other devices may have).

According to official Nintendo support, here's what you have to do:

If you want to move your digital games to a different system, you can deactivate your current console, then use your Nintendo Account to access the Nintendo eShop on the new console. The new console will automatically become the active console for your Nintendo Account, and all of your digital games can be played on the new system.

Key Points: You can activate one console at a time for your Nintendo Account. Your games are only playable on the current active console. While a console is active for your Nintendo Account, everyone on the console can play the games you’ve purchased. If you change the active console for your Nintendo Account, your games will not be playable on the deactivated system unless you make that the active one again for your Nintendo Account. Save data (for digital AND physical games) cannot be transferred between systems. Physical games are not tied to a specific console or Nintendo Account, and can be played on any system you like.

How It Works:

• Link a Nintendo Account to your Nintendo Switch console.

• Access the Nintendo eShop. Your console is now activated for your Nintendo Account. Purchase games and / or add funds in Nintendo eShop. These will be tied to your Nintendo Account. Everyone on system can play games, but only you can use funds in your Nintendo Account balance.

• To change the console where you play your games, access the Nintendo eShop on your active console and deactivate the console for your Nintendo Account. Games you’ve purchased will no longer be playable on the deactivated console.

• On the second Nintendo Switch console, use the same Nintendo Account to access the Nintendo Switch eShop. This is now the activated console for your account. You can now use this console to make purchases and download new and previous game purchases.

So technically you can, but it's complicated, and isn't exactly sharing, just moving.