How to Open a Bank Account in Germany
Foreigners can open a bank account in Germany, both in a German and an international bank, as well as in an online bank. Most banks offer both free and paid (from 2.90 to 14.90 euros per month) accounts that differ in the range of available services. In some cases, registration / residence permit in Germany or a certificate from an employer may be required to open a bank account.
1. Banking services in Germany In Germany there is a three-tier banking system consisting of private commercial banks, state savings banks (Sparkassen and Landesbanken) and cooperative banks (Genossenschaftsbanken). There are also many international banks, online banks and mobile banks operating in Germany. The German Federal Bank is the national central bank, while the Federal Financial Supervision Authority (BaFin) is the regulator of banking and financial services.
2. Why do I need a bank account in Germany? It is not necessary to have a German bank account to send and receive payments in Germany. A German bank account for regular payments is required to pay for utilities, insurance premiums, rent payments, mortgage registration in Germany. Also, a German bank account may be required for employment in a German company, home Internet connection.
3. Before opening a bank account in Germany, when moving to Germany, it is not necessary to have a German bank account: foreigners can manage their finances from a foreign account. Most companies in Germany accept major international debit and credit cards, such as Visa, Mastercard and American Express, as a means of payment. However, if the account is opened in a bank that does not have a representative office in Germany, there is a high probability of additional transaction costs. Foreigners can use the services of online or mobile German banks (Direcktbanks), which open accounts for non-residents in advance and open a non-resident account before moving. However, it should be borne in mind that opening an account may not be available to citizens of some countries. Major international banks, such as HSBC and Citibank, also operate in Germany; having an account with these banks, you can request its transfer to a German branch before moving.
4. Types of accounts in German banks German banks offer customers different types of accounts. The main types of accounts offered include:
4.1. Settlement account (Girokonto) Settlement account is a standard type of bank account in Germany. It is intended for receiving wages in Germany and paying bills. Many German banks offer current accounts for both general and special purposes, for example, for students and young people.
4.2. Savings Account (Sparkonto) This can be either a demand deposit (Tagesgeldkonto) to accumulate cash, or a term deposit (Festgeldkonto), which is an account with a higher interest rate, a minimum deposit and a fixed period during which funds must remain in the account. Term deposits are used to a greater extent in investment banking. Savings accounts can usually be opened by both residents of Germany and non-residents from abroad.
4.3. Non-resident Account Standard settlement accounts are usually available only to residents of Germany. As a rule, in order to open an account, it is necessary to have permanent residence in Germany. Many German banks that operate only online or only from mobile devices also offer accounts to those who live abroad. They are interesting for those who are planning to move to Germany, or for those who work in Germany.
4.4. Digital and mobile accounts The largest banks in Germany now offer services via the Internet, as well as mobile accounts available through mobile banking applications. There are also many banks in Germany that operate only online or only from mobile devices.
4.5. Offshore account An international offshore bank account is popular among foreigners living in Germany. An offshore account can be especially useful for those who work abroad, spend a lot of time in several countries, or often transfer money between countries. Offshore accounts are located outside the country of residence of the account holder and usually offer clear advantages, such as a wider range of cross-border services and lower tax rates on accounts. As a rule, they are considered stable, reliable and safe. Both Deutsche Bank and Commerzbank have international branches offering offshore banking services.
5. What German banks offer Foreigners who open a bank account in Germany have a wide choice. First of all, it is necessary to decide which bank to open an account with: a private German bank, a state savings bank (Sparkassen), a cooperative bank (Volksbanken /Raiffeisenbanken), an international bank or an online bank (direkt Bank).
5.1. Private German banks The private bank with the largest customer base is Deutsche Bank, which together with its subsidiary bank, Postbank serves about 12 million customers.
It is followed by Commerzbank with about four million customers. For foreigners, choosing one of the largest and most popular banks in Germany may be justified. These banks have extensive experience working with both foreign clients and foreign banks. They are often more accessible, including when traveling abroad.
Deutsche Bank offers three current accounts:
An Active account that is compatible with online and mobile banking and has an initial free period (further maintenance costs 5.90 euros per month);
BestKonto Account: This is a premium account offered together with a package of services, which includes a Mastercard Gold credit card and an international insurance policy. The cost of such an account is 11.90 euros per month;
a free “Young” account for students, interns and volunteers from EU member states under the age of 30.
Commerzbank also offers three current accounts:
“Girokonto” (current account): a free basic account that includes debit card registration; an electronic or mobile version of the account can be selected;
“KlassikKonto” (classic account): involves registration of an additional Mastercard debit card and various money transfer options; the cost of service is 4.90 euros per month;
“PremiumKonto” (premium account) allows registration of up to four credit cards, free cash withdrawal at all ATMs and the ability to issue an insurance policy; the cost of service is 12.90 euros per month.
Girokonto and KlassikKonto accounts offer 100 euros as an initial balance; an additional 100 euros is also credited to the Girokonto account for recommending the bank to new customers.
HypoVereinsbank offers four current account options:
A free starting account for students, interns and persons under the age of 26;
An active account worth 2.90 euros per month; the cost of issuing a debit card is 5 euros per year;
a “Plus” account for 7.90 euros per month with a wider range of money transfer options and the possibility of issuing a credit card cards;
An “Exclusive” account, which includes withdrawals worldwide for 14.90 euros per month. Sparkasse Sparkasse are savings banks owned by public shareholders: for example, cities or local communities. They are very popular among residents of Germany.
Sparkasse exist in major German cities and bear the appropriate names: BerlinerSparkasse is located in Berlin, Stadtsparkasse Munich – in Munich, Frankfurter Sparkasse – in Frankfurt. You can open a basic settlement account (Girokonto) in Sparkasse. At the same time, a debit card is issued to the client and access is provided to the subsequent opening of accounts of various types. The bank also provides an opportunity to issue demand deposits and term deposits. To open a current account in Sparkasse, you must be a resident of Germany.
Volksbanken and Raiffeisenbanken
These banking cooperatives and credit unions form the third pillar of the German banking system. Many of them work under the leadership of Volksbanken and Raiffeisenbanken. Settlement accounts of various types are offered: for example, a basic account that provides access to free banking services, debit card processing, money transfers and online banking operations (provided that a separate Volksbank account is set up for this, in which the user has an account). As in the case of Sparkasse, you need to live in Germany to open an account.
There are branches of many international banks in Germany. The advantage of international banking is that a foreigner can open an account in the country of origin / permanent residence / citizenship and transfer it to a branch in Germany.
International banks in Germany offer services aimed at foreigners and provide services similar to those of large German banks.
International banks operating in Germany include:
- Barclays Bank Santander
- Citibank ING Bank
- BNP Paribas
- Digital and mobile banks
Digital banks in Germany are called Directbank. Digital banks, as a rule, do not have local branches: you can get access to banking services through ATMs of other banks.
Digital banks can often offer more attractive terms. Some digital banks offer free bank accounts with no minimum deposits.
Digital banks include:
6. Choosing a bank account in Germany
There are a number of factors that influence the choice of a bank account:
Expenses: many German banks offer basic current accounts for free, but in this case the range of services available may be limited. As for money transfers, their cost is usually lower in online and mobile banks. However, the number of transactions that can be made per month may be limited.
Services in English: Many international and mobile banks, as well as most major banks in Germany, provide an opportunity to get acquainted with their website and mobile applications not only in German, but also in English. In Sparkassen and Volksbanken banks, translation from German into English is less common.
Range of banking products and services: Foreigners are advised to pay attention to services such as free withdrawals abroad and international money transfers at a low cost. Other banking services should also be analyzed: credit cards, overdraft and free withdrawals from ATMs in Germany.
Availability: An online or mobile bank account can be accessed online around the clock. Most major banks also offer the option of quick access to the account via the Internet.
Account for non-residents: if you need to open a bank account before moving to Germany, you need to open an account in an online or international bank. National German banks, as a rule, provide services only to residents of Germany,
you can analyze and compare the conditions for opening and servicing accounts in various German banks on the website DeutschesKonto.org; the service is available in English.
7. As a foreigner to open an account in a German bank
For EU citizens, as a rule, there are no special requirements for opening an account in a German bank. Citizens of non-EU countries must confirm their registration in Germany and/or provide a valid residence permit in Germany.
In some cases, a work permit in Germany may be required. The Bank may refuse to open an account if the client cannot provide his financial history.
It is recommended to personally visit the bank branch with the necessary documents, which should include:
- Passport / photo ID and a valid visa or residence permit;
- Proof of address;
- Proof of income / employment (required by many banks depending on the type of account);
- Confirmation of student status (when opening a student account);
- Credit rating from the bureau credit information (may be required at some banks).
In addition, the applicant may need to confirm his identity at the post office or online by completing the identification procedure by mail. The invoice processing process usually takes 2-3 business days.
7.1. How to open a bank account in Germany from abroad
Some online banks (bunq, DKB Bank, ComDirect and N26) allow customers to open bank accounts from abroad, but in some cases this option is available only to EU citizens. Some banks require you to provide personal documents electronically online, while others (for example, bunq) allow you to open an account in a few minutes using only a mobile phone.
If a foreigner wants to open a German bank account before moving to Germany, he will need to have a valid German visa and provide a residence address in Germany. For citizens of certain countries, opening an account may not be available.
7.2. How to open an electronic or mobile bank account in Germany
Some German banks allow you to open an electronic account online, without visiting a bank branch. If you have an existing bank account, you can transfer it to an electronic form by downloading a special application of the desired bank to your mobile device. To open an electronic account in a mobile or online bank, an email address, a mobile phone number and a valid identity card are required.
7.3. How to open a bank account for business in Germany
A separate business account is usually required for those who open a business or work as a freelancer in Germany. If the company is a closed joint stock company, having a separate account will be a legal requirement.
The process of opening a bank account for business in Germany depends on the business model used. Individual entrepreneurs and freelancers, as a rule, must provide the same documents as individuals. Partnerships are required to provide detailed information about all partners, while closed joint-stock companies must submit a charter, business registration data, a certificate of registration, as well as a list of shareholders and trading licenses (where applicable).
Business accounts for closed joint-stock companies in Germany must be opened in the personal presence of the CEO.
7.4. How to open a bank account in Germany for children
Many German banks offer settlement and savings accounts for children and young people.
The conditions for opening and servicing accounts for children in different banks may vary, but most German banks allow residents to open accounts on behalf of their children if they are under the age of 18.
It is usually required to provide documents such as a passport / identity card of the child and his legal representative. In some banks, it is possible to open an account for a child only if there is an account of a legal representative in the same bank.
7.5. What to do, if you refuse to open a bank account in Germany,
German banks may refuse to open an account for a number of reasons (for example, lack of registration / residence permit in Germany or unconfirmed creditworthiness). If the applicant is dissatisfied with the bank’s actions, it is possible to file a complaint with the Commissioner for Financial Complaints in Germany. If the applicant is an EU/EFTA citizen, he can also file a complaint with the EU Financial Dispute Resolution organization FIN-NET.
8. Banking services in Germany
Banks in Germany, as a rule, provide services similar to those of large banks in the United States, Great Britain and many other European countries.
In addition to the usual account opening services, debit/credit card processing, money transfers and loans, many German banks also offer:
- Insurance services, including insurance (vehicle insurance, housing insurance and health insurance); Mortgage loans;
- Pension programs;
- Investment programs.
8.1. International money transfers in Germany,
there are alternative solutions to banks for international money transfers that may be more profitable and convenient:
You can also use the online comparison tool Monito to save on fees, get more favorable exchange rates and search for the most attractive options for international money transfers.
9. Bank account management in Germany
Many banks offer a wide range of account servicing options:
Personal: in recent years, the number of bank branches in Germany has decreased, however, according to statistics for 2016, there are about 13 physical branches per 100,000 customers. The banks have customer service groups, as well as specialists in banking services.
Via the Internet: this method provides round-the-clock access to the account and banking services. Most of the major German banks, including Sparkassen and Volksbanken, offer this account service option.
Using a mobile application: The mobile application allows you to perform banking operations and mobile payments from a mobile device using mobile banking applications, which also include additional services (for example, budgeting tools).
10. Changing a bank or closing an account in Germany
It is quite simple to close or change a bank account in Germany if the client has no debt to the bank. The necessary procedures should be followed in order to avoid accrual of additional commissions or fines.
When switching to another bank, it is recommended to first open a new account with the selected bank. To close an account in Germany, as a rule, it is required to fill out and sign an application for closing an account. Before doing this, the applicant should make sure of the following:
There may be a condition in the contract that the account must remain active for a minimum period. If this requirement is not met, the bank may charge a fine.
The Bank must notify the applicant that the account is officially closed (by e-mail or letter). The applicant is advised to keep this notice.
Automatic payments coming from the account must be canceled. It is recommended to inform your employer and other third parties who can make payments to the bank account that it is no longer used.