- 1 Who benefits from having a bank account in Germany?
- 2 Which type of account should I open in Germany?
- 3 What types of banks are there in Germany?
- 4 How can I open a bank account in Germany?
- 5 Residence registration in Germany
- 6 The process of proving your identity
- 7 How can I deposit money on my new German account?
- 8 Bank details and SEPA
Safety is a strong reason to open a bank account in Germany, but there are additional benefits. For example, in a modern and developed country like Germany, banks usually offer state-of-the-art services including a large network of 24/7 operated bank machines, save online banking and an increasing variety of extra features.
The opening and maintaining costs are usually very little and there are many options for entirely free bank accounts both of savings and custody accounts. In many cases you can even get a free credit card, mostly MasterCard or Visa Card. Some banks even offer a credit card which you can you to withdraw money for free worldwide. Of course, you can also withdraw for free from bank machines within Germany. Not every bank gives you free cash if your account is with another bank but there is a well-developed network of bank machines in Germany and you can usually find your own bank or a partner bank within a short distance, especially in urban areas.
Also with regards to the service, German banks will offer a great deal of convenience. It helps to know some German but it is not required as in most cases it will not be a problem to talk to an English speaking operator. Also other languages are quite often offered as a medium of communication when in contact with bank staff, mostly Spanish, French, Turkish, Polish and Russian. Many banks also offer a call back service if requested. The hotline can often be called free of charge and it operates 24/7.
A special advantage, if you are interested in a bank account in Germany, is that in some cases you don’t even have to be in the country to open the account. You can enjoy the convenience of staying in your home country and still get a safe and useful bank account in Germany.
For people who live in Germany as expats (or plan to live), the benefits of a local bank account are even more obvious. You can use the service of your local German bank, withdraw and deposit cash for free, use online banking to wire money free of charge or check if funds have arrived. If you work in Germany, it may even be required to maintain a German bank account if you want to receive a salary.
Who benefits from having a bank account in Germany?
Having a German bank account is particularly useful for certain groups of people. Firstly, there are people who travel for business reasons to Germany. If you spend a decent amount of time in the country you will definitely benefit on enjoying the services of a local bank. Hotel costs may add up and in many cases you may lower your expenses by renting an apartment. Usually you need to pay your rent from a local bank account which is why we recommend to open one in advance.
Also people who travel for pleasure can benefit on a German bank account. Being located in the country of travel world champions, the German banks offer accounts with extraordinary advantages for frequent travellers. Within the Euro zone it is possible to withdraw euros from any German account. The benefits of a German bank account don’t stop within this area though. There are German banks who offer accounts with a credit card that can be used to withdraw money for free anywhere in the world.
For people outside the euro zone it will be useful to have an account that is managed in Euro from the country with the biggest national economy in Europe. It is expected that the Euro will continue growing stronger and increasing its value in comparison to other currencies. Especially for people from countries with higher inflation, it can be very useful to open a Euro account in Germany. What comes in handy is that German banks usually don’t charge for currency exchange. Therefore even larger amounts of funds can be brought to Germany without a loss but most likely rather an increasing value. Not only the low inflation in the euro zone strengthens the currency but also the huge value of bonds in that currency.
Also, the deposit insurance system in Germany works significantly better than in many other region in Europe. Not only people from countries outside the euro zone benefit on an account in Germany but also people from euro zone countries that face financial problems. Many people from Cyprus and Greece, for instance, transferred their funds to Germany to be sure their money is safe.
People with a bank account at home and one in Germany can also benefit by monitoring the exchange rate. Many people from the US and Canada, for example, like to transfer their dollars to their German bank account when the exchange rate is advantageous and vice versa.
Also many private investors like to use their German account effectively. German stocks and bonds are considered very stable and interesting for investors worldwide. Using a German bank account significantly lowers the costs of purchasing them, especially for small private investors. People who are not resident in Germany have to pay no taxes in Germany at all. For residents there are ways to pay very little or no taxes. If the amount of investment earnings remains below a certain amount (which is relatively high for an individual investor), no taxes have to be paid.
Which type of account should I open in Germany?
There are quite a few types of accounts which may make your life easier both as an expat resident in Germany and as an investor living abroad. The typical types of accounts offered in Germany consist of the following.
- Girokonto (Current account / checking account)
- Tagesgeldkonto (Call money account) Sparbuch (Account book)
- Aktiendepot (Custody account)
Girokonto (Current account / checking account)
The vast majority of people who work in Germany hold a personal current account (checking account). It is the account which is usually used to receive income from employment or payment from invoices for self-employed work. The account is also used to transfer funds to other accounts, withdraw or cash in money, paying standing orders, for example for the monthly rent, or for direct debits. Some accounts can overdrawn up to a certain amount (Dispositionskredit) but this should only be used in emergency cases hence the interest rate is relatively high.
Banks usually give out a banking card “EC card” which can be used for the services at bank machines. Usually, a credit card is offered to the account holder for an extra fee. Sometimes those cards are combined in one.
Many accounts of this type provide online banking and other features such as a 24/7 customer services hotline or a time chart of your balance. Some banks offer different versions of this type of account depending on the personal needs of the customers. The fees usually vary from free to a few euros per month depending on the selected account. Direct banks that don’t operate branch offices, like DKB, usually offer accounts with lower fees and or no fees at all while still providing a good service. Additionally, some banks even offer a free credit card for their account holders.
Withdrawing money and depositing
If you use a bank machine of your German bank in Germany, there will be no charges for the transaction. The same applies for deposits. When using another bank, there will be a fee of a few euros for each transaction. Doing this regularly may add up to cost you big money. Many banks, however, are organised in groups which don’t take fees from any other bank within the collaboration.
The Cash Group consists of some major German banks and theirs subsidiaries including Deutsche Bank, Commerzbank, Comdirect Bank, UniCredit Bank / HypoVereinsbank, Deutsche Postbank, Bankhaus Neelmeyer und Norisbank. Together they operate around 9,000 bank machines in Germany. Additionally, customers can use around 1,300 Shell petrol stations to withdraw money for free. The nearest bank machine can be found using the tool on http://www.cashgroup.de/geldautomatensuche.html.
Another cooperation is Cashpool. It is run by like Degussa Bank, Netbank, Santander, Sparda, Targobank, Wüstenrot Bank and many smaller banks. Together they operate more than 2,900 bank machines. Their tool to find the nearest one can be found here: http://www.cashpool.de/Presentation/Cashpool/Home.
The bank machine cooperation provided by the Volksbanken und Raiffeisenbanken services group operates 19,200 Geldautomaten. Some other banks cooperate with the network.
The association of German savings banks (Sparkassen) operate more than 25,000 bank machines in Germany. Customers of Sparkasse as well as 1822direkt can use them free of charge.
Tagesgeldkonto (Call money account)
The Tagesgeldkonto ist mostly used additionally to a Girokonto (current account). The owner of a Tagesgeldkonto can access the money at any time and receives interest on what is paid in. Like a current account, the Tagesgeldkonto does not have a predefined period of validity and can therefore be used continuously until it may eventually be cancelled. Usually, there are no fees for using this type of account.
It is not possible to overdraw the account or use it for bank transfers, direct debits or standing orders. Also, it is not possible to withdraw money from this account from an ATM. Some banks allow receiving money for the Tagesgeldkonto from any current account while others require the holders to declare declare a current account which is used to transfer the money into the Tagesgeldkonto.
A Tagesgeldkonto is usually free of charge and the owner receives better interest rates compared with a current account. Many people use the Tagesgeldkonto as a way to store extra cash at a different place rather than their current account. Thus they increase the likelihood of saving funds for the future. A Tagesgeldkonto can also be used to buy shares for a custody account.
Sparbuch (Account book)
The Sparbuch is a very traditional way of saving money in Germany, usually offered by financial institutions with brick-and-mortar branches, for instance Postbank, Commerzbank and Sparkasse. Originally, it was a thin booklet given out by a bank were all account movements were written in. Today, this is mostly done electronically in the form of a card called “SparCard”. There is no predefined period of validity for a Sparbuch and you receive interest on the money paid in. You can, however, only access a certain amount per month, quite often 2000 euros. There are no fees on the account and the money is save by guarantee as required by law for this type of account in Germany. Like a Tagesgeldkonto, it is not possible to overdraw the Sparbuch, use it for bank transfers, direct debits, standing orders or withdrawal at ATMs. Postbank, however, offers a special Sparbuch which allows its owners to withdraw money in many countries around Europe free of charge, no matter if its euros or another local currency.
Nowadays, many people prefer the Tagesgeldkonto but the Sparbuch is a good alternative. In a world where everything is accessible online it may be a save location for saving money. Without being tempted to spend it online, the money on a Sparbuch usually remains longer available for the future.
Depotkonto (Custody account)
You need an Aktiendepot (also known as Depot or Aktiendepot) if you wand to invest in securities, stocks or bonds. Within the account you can manage the purchase and sale of these values. Having a custody account in Germany can be beneficial hence transaction fees may be lower than in your home country. Usually, there is a yearly fee for the account. Some direct banks, however, offer the account free of charge. Buying and selling is mostly done online, so you don’t have to be in Germany to do these actions. Some banks in Germany offer you a bonus if you open a custody account with them.
What types of banks are there in Germany?
When it comes to banking in Germany the options are diverse. A huge variety of financial institutions offer a large number of banking accounts and services. Therefore many people in Germany compare different banks using a current account comparison or a call money account comparison before opening a bank account. Additionally, it is useful to know what different types of financial institutions operate in Germany. They can be divided into the following three types.
- Sparkasse (savings banks) Branch bank
- Direct bank
The Sparkassen, for example Berliner Sparkasse, Frankfurter Sparkasse or Hamburger Sparkasse, are run as a public service. In contrast to common banks, they don’t operate mainly for the purpose of realisation of profits. They are rather designed to offer the population a save and interest bearing option of investment as well as access to sophisticated loans. There is a nationwide network of Sparkassen all over Germany. They are easily recognisable by their logo, a red s with a dot on top. Usually, every single entity is restricted to a certain area but customers of a Sparkasse in one region can use many of the services of any other Sparkasse all over Germany, for example withdrawals at ATMs.
Whilst the Sparkasse is run as a public service, there are also large private financial institutions in Germany who operate their own brick-and-mortar branches, known as branch banks. Among the biggest banks in Germany are Deutsche Bank, Commerzbank, Deutsche Postbank and ING-DiBa. If you feel that you need personal contact with your bank, it may be recommended to open an account with a branch bank. They usually open Monday to Friday, whilst the Postbank operates also on Saturday and some branches on Sunday.
Apart from the branch banks, there are financial institutions in Germany who operate purely via the internet, phone or mail. Among the largest of these direct banks are DKB, ING-DiBa, Comdirect Bank, Consorsbank, Norisbank, 1822direkt and Netbank. Due to the fact that they don’t have to maintain so many buildings, they can offer more attractive rates than branch banks. They usually cooperate with branch banks to allow their customers to use ATMs all around Germany to withdraw money for free.
How can I open a bank account in Germany?
Opening a bank account may be easier than you think! Formal procedures in any country around the world need to follow certain rules but the way how it works in Germany is quite compact and can easily be understood. After carrying out the following steps, you will soon enjoy the benefits of a German bank account. Our first recommendation is a bank account at DKB but the process is similar to most other banks in Germany.
Residence registration in Germany
After starting to live in Germany, it is required by law that you register with the local authorities. Every time you move, you need to re-register with the authorities that are responsible for your new address (the same rule applies for German citizens as well). The procedure is free of charge but if you fail to register on time, you may have to pay a fine.
The local authority which takes the registrations is called the “Einwohnermeldeamt” (residents’ registration office). In some areas, for example Berlin, the demand for appointments may exceed the capacity by far. Therefore we recommend to get in touch with the local registration office as early as possible to schedule your registration. In other areas it may not be necessary to schedule an appointment in advance. We recommend to check the opening times in advance. Some offices may only take registration in the morning or on specific days of afternoons.
At the residents’ registration office you need to show your valid passport, for many countries a residence permit or visa and the completed registration form (usually available online). Don’t forget your signature. Since 2004, a copy of a rental agreement is no longer needed but you still have to provide the name of your landlord and the corresponding address. In case you are married, you also need to show a marriage certificate. The same applies for civil unions. If you move with your children you need to provide their birth certificates. All documents need to be shown as a certified translation in German.
The procedure usually takes only a short time. After a quick check if everything is fine, you will be given a confirmation form which proves your registration and may be used to open your bank account.
Finding and completing the online form
You can find the online form for opening a bank account at DKB here. The contractual language for bank accounts in Germany is German, but have a look at the translations below to understand what is asked for. Alternatively you can use a translating page such as Google translate.
On the online form you will find the following element (translations below):
Zum Ausfüllen des Antrages benötigen Sie max. 5 Minuten Zeit.
→ You need only 5 minutes to complete the application.
→ * required
→ owner of the account
Laut Abgabenordnung (Kontowahrheit) und Geldwäschegesetz sind wir dazu verpflichtet, uns Gewissheit über die Person und die Anschrift des Verfügungsberechtigten eines Kontos zu verschaffen.
→ We are required by law to establish certainty about the owner of the account including residential address
→ female (Mrs/Miss/Ms)
→ male (Mr)
→ title (Dr./Prof.)
→ first name(s)
→ name at birth
→ date of birth
TT: day (2 digits) MM: month (2 digits) JJJJ: year (4 digits)
→ place of birth
→ family status
→ civil union
Canada will be “Kanada”, the United States is USA or sometimes “Vereinigte Staaten von Amerika”, the UK is “Großbritannien” or “Vereintes Königreich (von Großbritannien und Nordirland). Other countries can be researched using an online translator.
→ telephone (daytime)
→ telephone (in the evening)
→ street, house number
→ post code, zip code
wohnhaft seit (Jahr)
→ resident since (year)
→ residential status (Eigentum → property owner, zur Miete → tenant, sonstiges → other)
→ employee (white-collar) Arbeiter → worker (blue-collar) Auszubildender → apprentice
→ civil servant
→ managing partner
→ no occupation
→ other self-employed
→ civilian service
Aktuelles Nettoeinkommen pro Monat in Euro
→ current monthly net income
→ further information
Ist Ihr Aufenthaltstitel unbefristet?
→ do you have an unlimited residence permit? (ja → yes, nein→ no)
Möchten Sie einen zweiten Kontoinhaber angeben?
→ would you like to declare a second owner of the account? (ja → yes, nein→ no)
Wurden Sie von einem DKB-Kunden geworben?
→ Did you receive a recommendation from another customer? (ja → yes, nein→ no)
The process of proving your identity
After completing the application online you will receive a document which you may print, read, check again and finally sign. If you don’t have access to a printer you can inform the bank. Many will then send you a paper version of the form you completed online. The next step will be the identification process. Every bank in Germany is required by law to verify the identity of the new owner of the bank account. The easiest way is verification via the PostIdent method. If you want to use the account with an address in Germany, you need to verify this German address before you can use it for official communication with your bank. Therefore you need to register.
It is very common in Germany to use the PostIdent method in order to open a bank account. The procedure is paid by the bank and therefore free of charge for the person who would like to open the account.
All you need to do is bring the information sheet from the bank and your national ID or passport to a subsidiary of Deutsche Post. You can find the nearest one by using their internet service which you can find here (http://standorte.deutschepost.de/Standortsuche? standorttyp=filialen_verkaufspunkte&lang=en). Check the opening hours. Some subsidiaries will do PostIdent at night, on Saturdays and Sundays. Many offices are located in airports which may be helpful for some people.
Bring all the documents requested by the bank to the nearest subsidiary and hand it in. Be prepared that the clerk will help you with the PostIdent procedure which they are trained in but they may not be able to help you with anything else regarding the bank account. Those details need to be discussed with the bank directly.
Other forms of identification
Apart from the PostIdent method, there are other ways to do the necessary identification for opening a bank account in Germany. A lawyer or a notary can do the process for you. All you need to do is request the appropriate form at the customer service of DKB (or the bank of your choice). The costs for the procedure will usually be reimbursed by the bank on request if they don’t exceed the normal amount for this service. Most banks also accepts if the verification process is done by any another bank subsidiary.
How can I deposit money on my new German account?
Once your account is ready, you can start despositing your money in a save haven. For people who are employed in Germany or do business wish German clients it will be easily possible to receive funds. You simply inform your employer or your clients about your bank details.
Bank details and SEPA
The bank details have changed since introducing the new SEPA system, but it is possible to determine the SEPA details from the old banking details and vice versa. Traditionally, German banks used an account number and a bank code. SEPA also uses an account number (known as IBAN) and a bank code (known as BIC code or SWIFT code). The old German bank code as well as the old account number are part of the IBAN. The BIC (or SWIFT) is a new international code for banks and other institutions.
Once your employer (or clients) got your bank details, they will be able to transfer money to your account. The transfer will usually take no longer than one day. At most banks you can benefit on the fact that it is free of charge! Most banks also offer online banking which enables you to easily recognise the increased account balance easily by using your computer (or mobile device).
If you would like to transfer money to your account from outside the SEPA area, check the fees of your bank for international transfers. Many banks all around the world offer acceptable fees for transferring funds to Germany. Again, all you need are the bank details (IBAN and BIC). Alternatively you can send a check to your new German bank. This is recommended in case your bank charges a high for international transfers (for instance many US banks).
In case you stay in Germany and you have cash you would like to deposit the best way is to use a bank machine. Check with your bank which one you can use without fees. Even direct banks have agreements with branch banks to use their devices for free for both withdrawals and deposits.