How Germany could improve its banking system

Familiarizing yourself with the banking system and opening accounts is an important step in settling abroad.

As The Local reported earlier this week, there are a lot of things to consider when choosing a bank to store your hard-earned money in Germany. They include fees, types of accounts, and whether you qualify to open the account.

READ MORE: What are the best banks for foreigners in Germany?

We also asked readers what they would like to see improved for banking services in the Bundesrepublik. Here is what they had to say.

“Far from being modern”

This is perhaps not surprising given that Germany is known to continue to use the fax machine regularly, but one of the highlights was that Germany needs to do more to modernize its services.

Many readers have pointed out the need to improve online banking services.

Deniss, 42, of Frankfurt said: “They are definitely lagging behind in terms of offering modern online technologies to customers.”

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Gondal, 37, in Böblingen, said: “They are a far cry from modern banks. In fact, a lot of things need to be changed. German banks should provide online services.

Mohamed Abouseif, 25, in Munich called for “more digitization and better English support from banks and websites as it is a very common second language ”.

Abuseif also said that more German banks should offer a Visa / Mastercard debit card with current accounts “which can effectively be used online or in other countries instead of the Girocard (EC card) which is mainly useful for food shopping “.

“It really surprised me that Poland has had this since I first went there in 2014, while Germany is always late when it comes to implementing such things. “

Simon Slade, 69, thinks that Germany needs to rethink the “archaic” EC vsard – which is the country’s preferred card payment method.

READ ALSO: “They thought it was witchcraft”: the verdict on card payment in Germany

A customer pays by card in a Berlin boutique. Photo: picture alliance / dpa / dpa-Zentralbild | Georg wenzel

Some businesses – like post offices or government buildings – only accept EC card or cash.

Germany should take “concrete and concerted steps to simplify the acceptance of cashless payments by retailers, cafes, etc.” – for example, charge them for depositing cash, ”Slade said.

In fact, many readers have pointed out that they would like to see more banks in Germany offering services in English.

Dorka, 27, from Baden-Württemberg, said: “Please be in English too! Completely removing this EC system would also be good.

Keshava Prasad Gubbi, 32, in Munich, said he would like banks to use “more English, be more open to internationals. Letters and documents in English and German would be so much more useful than having them only in German.

JM in Potsdam summed up the mindset of the bank in Germany: “It should enter this century.

More costs

Many respondents to our survey reported that the fees imposed by Germany for simply having a bank account or withdrawing your own money put them out of the system.

“Now almost all banks have a mandatory monthly fee of € 7-10 minimum for personal accounts,” one reader said. “Whereas in the UK and US almost all personal accounts are free with no minimum balance.”

READ ALSO: Why bank customers in Germany face higher fees

Himeel, 29, of Regensburg, said German banks need to work on these points: “Go paperless, offer better savings options (Tagesgeldkonto) and free card transactions for frequent travelers.

Alison, 29, in Hamburg, said there should be no charges on checking accounts.

German banks usually charge you to withdraw cash if it is from an ATM that is not your bank, although you can get a few withdrawals per month for free from the account.

Chris, in Brandenburg, said being able to “use other banks’ ATMs for free” would make a big difference.

A person uses his bank card at an ATM in Germany. Photo: picture alliance / dpa / dpa-tmn | Benjamin Nolté

Faster transfers

Several people wondered why transfers between different banks take longer in Germany than in most other European countries – sometimes up to three working days.

Prince, 35, in Munich, said: “Transfers from one bank to another are very slow. We always seem to issue a check instead of an online transfer.

SUnil Kulkarni, 33, of Reutlingen, said real-time transfers are a “must in today’s world”. “Some banks already offer this option, but at additional costs. I would prefer this service to be free for everyone.

A few respondents to our survey raised the issue of banks acting unreasonably.

“It’s ridiculous that they can close your bank account with just two months notice, for no reason,” said Richard, 65, in Dortmund.

Mary, 54, in Dortmund also pointed out that “the ability of banks to close accounts so easily” was a problem.

Meanwhile, the question of FOreign Account Tax Compliance Act, or FATCA for Americans Abroad was also highlighted. The legislation, which requires foreign banks to report to the U.S. tax authorities any assets held in these accounts by U.S. taxpayers, has resulted in a some German banks close accounts or turn away customers from the United States.

J Rosenbaum said: “US citizens are very limited in the services they can use – not eligible to earn interest, no investment accounts etc. US FATCA law has made US expatriates financial outcasts. “

READ ALSO: Why are Americans turned away from German banks?


Thanks to everyone who shared their experience with us. While we were not able to include all of the submissions, we have read each one.

Michael J. Birnbaum

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