Banking in Germany
German banks provide cheque and savings account services and make loans, just like their UK counterparts, but foreign transactions are much more important for them. They also have some services that are less common in the UK, like dealing in securities and providing investment counselling. New arrivals to Germany should inform themselves of any particular preference to banking institutes to join in Germany, for example there may be affiliations from your bank in UK with a German bank, you should also bear in mind that on initial arrival a bank account should be opened as soon as possible, but the location of your permanent accommodation may not be identified at that stage and may of course be in a different location.
Setting up an account is fairly straightforward, all you need is your passport and a letter confirming employment in Germany from your employers (Arbeitsbestatigung). BAESG can organize this for you. This employment confirmation simply states the start-date of employment, expected duration and gross salary.
Once the necessary application forms have been completed, you will be issued with your Account Number (Konto Nr) and Sort-Code (Bankleitzeil) immediately; the cash-card (Euro Cheque Card /EC Karte) will be sent to your home address on average within 2 weeks, however each bank is different in the time it takes to despatch these cards. You can use your Account Number and Sort-code to organise credit to be transferred immediately and whilst waiting for your cash-card to be sent to you, funds can be drawn from the branch of your bank account at any time, in person.
With an EC card customers can withdraw cash from cash-point machines, not just from Germany but around the world, it is also possible to obtain statements from account printers 'Kontoauszugdrucker' The EC card is commonly accepted for payments at shops, hotels, ticket offices, department stores and even supermarkets. Please note however, that although you can use just about any bank's Cash Machine (outside Germany also), you may have to pay a fee if you use a bank that is not affiliated with your bank.
Since the introduction of the EC Bankcards, credit cards have been less common in Germany. Recently, however, there has been a big push to get credit cards into the hands of customers, especially with the withdrawal of the Euro Cheques. Customers can also withdraw cash from the Eurocard (once a PIN has been issued). The spend on a Eurocard must be cleared at the end of each calendar month.
A Eurocard can be obtained in much the same way as in UK, beomg affiliated to your bank, and accepted at most establishments worldwide. However, please be aware that smaller restaurants and bars seldom accept credit cards, so to avoid embarrassment it is always best to ask if credit cards are accepted before ordering food. Establishments that accept payment with the EC Card and credit cards will usually have the types of cards that you can use displayed in the window or entrance door.
Some cards have a smart chip imbedded in them. These chips can be "loaded" with up to Euro 200 at a "loading" station in many banks. Money is transferred from your account onto the smart chip, you therefore will need your PIN and identification documents. If a shop or facility has a machine that can read the chip you can use the credit on the chip to pay for purchases. (Some parking garages and even some of the machines that issue the parking permits on city streets accept the smart card. This is convenient if you do not the have enough coins to pay for parking.)
This card/chip on your card allows customers to 'fill-up' with cash, it is a simple process to fill-up as it does not require a PIN or formal identification documents (as the 'Electronic Cash' does). Same use as 'Electronic Cash', however no cash-withdrawals are possible.
You can also use your EC Card to print-out your latest statement (Kontoauszug). As services become more and more automated, many banks have both an Automatic Cash Machine and statement printer in their lobbies that you can access these around the clock. It is even possible to get transfer blanks printed with your name and account number at machines in most banks. Many banks will still post statements on request, but there is a charge for this that seems unnecessary in view of the convenience of these machines.
You can establish a bank overdraft, usually two or three times your monthly salary, but be warned that these overdrafts will incur heavy interest, generally 10 to 12 percent per annum.
Eurocheque services are currently being withdrawn. Most German banking institutes have installed the Eurocard or Credit cards as the main payment method for their customers.
There are several different kinds of banks in Germany. The main ones are the public sector commercial banks
(Private Geschäftsbanken), savings banks
(Sparkassen) credit cooperatives
(Kreditgenossenschaften) and the Postbank. The distinctions between these are seldom of concern to the depositor. The current account
(Girokonto) is more or less the same at each of them.
Savings banks, which have been growing explosively, are practically indistinguishable from commercial banks. They were originally for savings accounts, but now offer full service. The main difference is that their ratio of savings to cheque accounts is higher than with commercial banks, and they are not as involved in foreign transactions.
An example of the main
credit cooperatives would be
Volksbanken (cities) and
Raiffeisenbanken (rural areas). They too offer the full range of banking services. Many of them are small and their numbers have been declining through mergers. The
Postbank is inexpensive and acceptable for the small depositor, but is very limited in the services it offers.
http://www.dresdner-bank.com (English-language options)
http://www.sskm.de
http://www.hypovereinsbank.de
http://www.db24.com (English-language options
http://www.postbank.de
http://www.deutsche-bank.de (English-language options)
http://www.raiffeisenbank.de
As a rule German banks are open from 0900 to 1600 and on Thursdays to 1730 or 1830. Some smaller branches shut at lunchtime.
There are several ways of conducting monetary transactions:
Transfer (Überweisung) is generally used in place of the UK system of sending a cheque in the post, but rather than sending a cheque to the individual, in Germany you send a money transfer instruction (Überweisung) direct to your bank requesting the funds are transferred direct to the recipient's bank. Therefore new arrivals in Germany will notice that bills arriving from German organisations always include bank details, and sometimes
a pre-completed Überweisung with the organisation's bank details, for you to complete your personal banking data and send to your bank for payment.
Standing order (Dauerauftrag): is used if you have regularly recurring payments of a set sum, such as rent, insurance premiums, television fees etc. This sum can be deducted automatically from your account on an agreed date and transferred to the account of the recipient. The bank will provide you with the necessary form.
Direct debit (Lastschrift): This is a practical method of payment if you have recurring sums that vary in size, such as the telephone, gas and electric bills. You should complete a direct debit authorization (Einzugsermächtigung) form, which authorizes the receiving organisation to deduct the respective amounts from your account. You can also cancel the authorisation and stop the direct debit. As a safeguard against abuse you have the unrestricted right of 90 days to recall any sum that was deducted incorrectly.
German banks, like those in other European Union countries, are now in a period of transition to the common European currency, the Euro. Between the period January and February 2002 cash transactions can be performed in both Euro and Deutschmark, from March 2002 the Deutschmark will not be accepted as currency. Please see Section Euro.
