I have created a list of the best bank accounts for internationals in Germany.
In 2019, there was 1717 banks in Germany. The country is severely overbanked. Therefore, it can be difficult for foreigners to know the advantages and disadvantages of different banks in Germany.
Types of Banks
Before diving into the best bank accounts for internationals in Germany, let me briefly introduce the different groups of banks in Germany.
Sparkassen
The most important difference between Sparkassen and other banks is the mission. Sparkasse is not maximizing profit but is committed to the common good. They are also not owned by traditional shareholders but usually by local or regional municipalities. In order to best serve their local communities, the Sparkassen still have a large networks of branches. However, especially in rural areas, they have started to use innovative concepts such as mobile branches in buses.
In order to leverage economies of scale, the local Sparkassen have formed an association. For example, the Sparkassen together own Deka Bank, an asset manager who offers savings and investment products for Sparkasse clients. Similarly, the regional Sparkassen are also the majority owners of the Landesbanken.
I have not included Sparkasse on the list of recommended bank accounts as the conditions depend on your local Sparkasse and accounts are generally not free.
Volksbanken
The Volksbanken have a similar tradition as the Sparkassen. When Germany was experiencing an economic crises in the 19th century, people started to found many local cooperative banks to enable economic recovery.
Until today, the Volksbanken are owned by the members of the cooperations. Hence, their mission also is not to maximise profit, but to help to improve the lives of their members. As a result, they still operate a large network of branches.
Similarly to Sparkassen, I have not included accounts at Volksbanken as their conditions vary and accounts are often not free.
Traditional Branch Banks
Aside from Sparkassen and Volksbanken, there is a number of other banks operating branches in Germany. The biggest ones are Deutsche Bank and Commerzbank.
Direct/ Online banks
The last group of banks is direct and online banks. These banks do not have any branches of their own. Everything is done online, via mail or telephone. For many of these banks, you can open an account without ever leaving your couch. However, the process is sometimes not as simple for foreigners. Some online identification software only know German national identity cards. So foreigners instead have to take their passport to a post office to get identified. If you choose to take this route, make sure you have a passport that is passport reader compatible (i.e. not 10 years old)!
How to assess the best bank accounts for internationals in Germany
When deciding on the best bank accounts for internationals in Germany, there are a few factors you should keep in mind.
Account fees
In my opinion, the amount of fees you have to pay for your account is among the most important factors. Fees can range from free bank accounts to more than 100€ per year. Personally, I feel like high account fees are almost never justified. I would recommend looking for a cheap or free bank account. In fact, many banks even pay you for opening an account with them!
Credit card fees
Another factor to consider is credit card conditions. Some banks actually charge extra for credit cards.
In Germany, there is two types of credit cards. One type is the traditional credit card that withdraws the balance from your account at the end of the month. The other type works more like an EC or debit card. Expenses are charged to your account immediately after payment. The card still maintains all online pay and other credit card features.
ATM Network
The network of ATMs with free withdrawal is another important factor. To provide good service, some banks cooperate. For example, clients of Commerzbank can withdraw money at Deutsche Bank. Some banks also offer free withdrawals at any ATM.
Need for consultation
If you like to get personal advice, you don’t necessarily have to choose a branch bank. There is also financial advisors you can work with. Personally, I would recommend to work with a fee-based advisor. Bank advisors and “free” financial advisors have incentives to sell you products that are optimal for them, not for you!
Quality of App/ Website
There is a big difference in the quality and ease of use of different banking websites/ apps. Many German banks still struggle with legacy IT systems from the 80’s. They have to invest large amounts of money for changes in IT systems and therefore often don’t have the most modern apps/ websites.
Fees for international transfers/ withdrawls
This is a factor that is often overlooked in bank ratings. But for internationals, fees on withdrawals abroad can be an important factor when deciding on a bank.
Safety against bankruptcy
Finally, while safety against bankruptcy is an important consideration when choosing a bank, it is not as important in Germany.
In Germany there is the so called “Einlagensicherungsgesetz”. This law states that every bank has to be a part of a statutory compensation scheme or a bank-related protection system. These cover client deposits of up to 100.000€.
My top picks for best bank accounts for internationals in Germany
While it is convenient to have everything in one place, it is often advantageous to have multiple bank accounts for different purposes. My recommendation is to have one bank account for day-to-day use and a back-up bank account. The reason I recommend this is that banks such as Deutsche Bank regularly have IT issues. In the case of Deutsche Bank, some clients couldn’t withdraw any money for several days.
Another reason why it may be good to have a second bank is investment. The banks with the best accounts for day-to-day use generally don’t have the best fee structure on investment accounts. After all, they have to earn money somehow.
DKB Cash
Criteria
Account fees
Rating
Details
Account is free
Credit Card
Free Visa Card
ATM Network
Free withdrawals at any ATM with Visa Card (50€ minimum)
Branch Network
No branch network
App ease of use
App is like a copy of Website. Complicated authentification process, sometimes two Apps required.
International withdrawals
Free withdrawals at any ATM worldwide with Visa Card (50€ minimum) as long as there is a monthly inflow of at least 700€
International payments
Free international payments with credit card as long as there is a monthly inflow of at least 700€
DKB is very attractive for internationals in Germany. It offers a free account and Visa Credit card. You can withdraw money at any ATM in the world for free. There are no fees on international payments with the credit card. The only issue is the poor App that is not user-friendly and slow. Personally, I’d recommend getting a second account for online banking convenience.
ING
Criteria
Account fees
Rating
Details
Account is free as there is a monthly inflow of at least 700€
Credit Card
Free Visa Card
ATM Network
Free withdrawals from 50€ with Credit Card at Visa ATMs
Branch Network
No branch network, but if you live in Frankfurt can go to head office in case of issues
App ease of use
App is very modern and user friendly
International withdrawals
Fee of 5€ with Debit Card, fee of 1.75% with Credit Card
International payments
Free payments in €, otherwise fee of 1.99%
The advantages of ING are the free account and the user friendly app. However, if you use a lot of cash or travel abroad frequently, the fees on international withdrawals and payments sting.
Santander Best Giro
Criteria
Account fees
Rating
Details
Account is free as long as there is a monthly inflow
Credit Card
Free Visa Card
ATM Network
With Debit Card free at Cashpool ATMs and anywhere with Credit Card
Branch Network
Only 210 branches in Germany
App ease of use
App is very modern and user friendly, but recently some technical issues occured
International withdrawals
Free 4x per month with Credit Card
International payments
1% fee with Debit Card, 1.5% with Credit Card
Santander is a good alternative if you want a bank with branches in Germany. However, Santander has relatively few branches, so check if there is one in your area.
Deutsche Bank – the bank to avoid
While Deutsche Bank is the best known among internationals, I really cannot recommend them. Their bank account is expensive unless you are a student and the quality of their service does not make up for the price.
For some reason, Deutsche Bank listed me as a man when I first opened an account with them. I told them multiple times to correct this but they never managed. Apart from that, they failed to update my address even though I informed them I moved, send my bank statemens to an old address and charged me 30 or sth euros for return postage fees…
Their app is also not very user friendly and frequently crashes. Even their service is not as good as you would think. For example, when I contacted them via phone, they refused to speak English to me.
And if that wasn’t enough to scare you off, here’s the cherry on top. In 2016, a software error resulted in all outflows being duplicated. Thousands of clients were shown their accounts were suddenly empty. They could not withdraw any cash at ATMs either. It took multiple days for Deutsche Bank to fix this issue…
So, stay away from Deutsche Bank!
Conclusion
In my opinion, the best bank account for internationals in Germany is definitely DKB. However, you should consider having a second account in case of technical issues and for a more user-friendly app. In case you are looking for a bank with branches, Santender should be your top pick.
After reading it, I felt that it was really good. I spent a lot of time investigating and sorting it out. It was really amazing.
very useful ，supply such good choices to internationals。
Hello, you write very well. Let me, a Chinese who has never been to Germany, understand the basic characteristics of different German banks. I would like to write some impressions after reading. Haha, I usually have a little understanding of banking business. The author mainly introduces the savings business and credit card business of several major German banks from the perspective of consumers, and ranks them with different outlets. I can see that the author has done a very detailed data research work, especially the final comments on several business scores of several banks, which requires a lot of energy. In time, the author will surely become an outstanding expert in banking research.
Perhaps the author can extend it a little bit and analyze these banks from the perspective of bankers. As the president of a bank, the general accounting of these deposits of consumers is recorded on the liability side of the balance sheet. The author can start from spakassen, volkbanken and other online banks such as emerging Internet banks Banks will study the relationship between short-term deposits and long-term deposit interest rates of these banks for private deposits, and how these banks use interbank certificates of deposit to lubricate the liquidity at the liability side. Second, the largest part of the debt side is not private deposits, but corporate deposits, which is the foundation and cornerstone of bank deposit business. Behind every big bank, there are shadows of big customers like Deutsche Bank and Volkswagen.
There are three parts in the bank’s liability side: private deposits, corporate deposits and interbank certificates of deposit. This is a complete picture of the liabilities side of the bank. I hope the author will have an article from three aspects. Ha ha, I have a good time. I am looking forward to the next article of the author. Come on, come on. You’ve made a mess of it.
great