Banks Turn Away Customer Deposits due to Negative Interest Rates in Germany – Finance Bitcoin News

According to reports, banks in Germany are rejecting customer deposits because of the negative interest rate imposed on them by the European Central Bank (ECB). Some banks even offer online tools that customers can use to make their deposits elsewhere.

Negative interest rates imposed by the ECB are forcing banks to turn away customer deposits

Banks in Germany have asked customers to make their deposits elsewhere because they can no longer bear the costs of parking at the ECB, the Wall Street Journal reported on Tuesday. The central bank has introduced negative interest rates since 2014. The interest rate is currently -0.5%, which, according to the central bank, is unlikely to change anytime soon.

After years of trying to pass the cost of negative interest on to customers, such as charging higher fees, banks in Germany are now rejecting customer deposits, the publication said.

Banks are even offering new online tools that customers can use to make their deposits elsewhere.

More than 260 banks in Germany are currently charging negative interest rates to private customers, while this was only 57 prior to the pandemic in March last year, according to the price comparison portal Verivox.

The fees range from 0.4% to 0.6% for deposits between € 1 and € 500,000. In November last year, another comparison portal, Biallo, found that more than 300 banks charged negative interest rates. The largest German banks, Deutsche Bank and Commerzbank, have been charging new customers an annual interest rate of 0.5% since last year in order to have large sums of money with them.

In Germany banks are more affected by negative interest rates than in most other European countries because Germans save a lot. According to the ECB, around 30% of all household deposits in the euro zone come from Germany.

The coronavirus pandemic also made a significant contribution to intensifying the effects of negative interest rates on banks in Germany. Last year, deposits in the country soared 6% to a record $ 2.55 trillion as people spent less on lockdowns and travel restrictions. The publication added:

The savings rates skyrocketed among consumers at home. And huge aid programs from the ECB have flooded the banks with excess deposits.

What do you think of banks that reject customer deposits? Let us know in the comments below.

Photo credit: Shutterstock, Pixabay, Wiki Commons

Disclaimer of liability: This article is for informational purposes only. It is not a direct offer or a solicitation of an offer to buy or sell, or a recommendation or approval of products, services or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author are directly or indirectly responsible for any damage or loss caused or allegedly caused by or in connection with the use or reliance on any content, goods or services mentioned in this article.

Stay in the Loop

Get the daily email from CryptoNews that makes reading the news actually enjoyable. Join our mailing list to stay in the loop to stay informed, for free.

Latest stories

- Advertisement - spot_img

You might also like...