Finding the best bank in Germany is not an easy task. There are a lot of banks on the market, and therefore you have a dizzying number of choices. We have compared the pros and cons of every bank and made overview for you. In that way, you can find the best German bank account that fits to your needs!
The main question that you hear nowadays is if the online banks offer better value than brick-and-mortar banks (banks that have a physical presence in a building). According to the ‘Bundesverband deutscher Banken’ banks are steadily getting rid of their brick-and-mortar offices in the last years. Meanwhile, there is a clear up-trend in online banking. In beginning of 2011 just half of the adults used online banking in Germany, and currently it is up to 80%. This means that online banks are gaining ground on the traditional banks. However, it is up to you to decide what you like best. Finding the best bank in Germany for foreigners is not easy, but with our tips we will ensure that you will find the bank that fits to your needs.
The best online banks in Germany
The banks that are mentioned in this section are online banks. Which means they don’t have branches in every city like the traditional banks. Online banks have become more and more present since they offer relatively high interest rates, good customer services, low fees and 24/7 access to your finances. Most traditional banks generally charge fees for withdrawals at another bank’s ATM within Germany. Most online banks don’t. The traditional banks are doing their utmost best to ramp up their web presence to compete with the online banks. Still, online banking is not for everyone. We have selected 2 of the best online banks in Germany for expats and english speakers:
One of the biggest and fastest growing banks in Germany is the DKB – Deutsche Kredit Bank. The bank was founded 1990 and serves now over 3 million German customers. If you are fine with doing all your banking online – this is the best bank account in Germany for you. It offers benefits and advantages that traditional banks do not offer and therefore DKB internetbanking very interesting for expats.
- ✓ Free account with no monthly input
- ✓ Free VISA card
- ✓ Free worldwide cash withdrawals
- ✓ 0.70% Interest paid on credit card balance
- ✓ Free securities account
- ✓ Monthly credit card and bank statements online
The DKB is a subsidiary of the Bavarian bank. The bank primarily focuses cash checking accounts for private and freelance clients, but they also offer financing of real estate and the granting of personal loans. Their main advantage is that they offer free VISA credit card with free worldwide withdrawals. This is something that can come in handy when you are often abroad.Moreover, you can withdraw cash from any ATM in Germany without paying additional fees. Also, DKB makes it easy to set up a German bank account for foreigners since they have a clear business model. THis is therefore the best bank in germany for foreigners and the best bank in germany for students.
The Nortisbank GmbH is an online bank which offers attractive rates. Norisbank is one of the best banks in Germany since it has recently moved all their business online and therefore can offer very attractive rates. It is a well trusted bank in Germany which was founded more than 60 years ago and a subsidiary of the Deutschen Bank. The Norisbank offers attractive rates at a very competitive level.
- ✓ Free account with no monthly input
- ✓ Free MasterCard
- ✓ Free cash withdrawals outside Germany
- ✓ Free Cash withdrawals at ATM’s from the Cash Group.*
The best traditional banks in Germany
The growth in online banking does not mean that traditional banking is at its end. A lot of people still go to their trusted banks to access their accounts. If you handle more complicated transactions or banking products on a daily basis, it would be advisable to put your money in a traditional bank. Moreover, if you are in a business where you handle a lot of cash on a regular basis, this would be the right choice for you.
The German Postbank AG is one of the largest traditional banks in Germany. It has around 16 million customers in Germany alone and has offices in every major city. This makes it the largest bank when it comes to dealing with current or checking accounts. The Postbank has offices in every major city and can be found and almost every village. If you prefer face to face banking- this could be an option worth concidering.
- ✓ Free account (at 1000 euro’s input per month)
- ✓ Free cash withdrawals at most ATM’s in Germany
- ✓ Free withdrawal with the credit card at home and abroad
- ✓ Free securities account
- ✓ VISA card for 22 euro per year (1st year for free)
The Postbank offers a lot of options; whether you want a personal savings account, a deposit or a trust fund – the Postbank can offer it. With a total asset of 147 billion and 18,000 employees Postbank is a big player in the market. The Postbank is well known for its high customer satisfaction rate. The company primarily focusses on business with private customers and on small and medium-sized companies.
Commerzbank is the second largest bank in in Germany. With around 1200 bank branches in Germany alone, it is one of the most represented banks in Germany. It has around 14,5 million customers worldwide and was founded in 1870. The Commerzbank is a strong entity that offers almost everything a normal customer may need from their bank. They are well represented within Germany and can be found in every city and almost in every village.
- ✓ Free account (at 1200 euro’s input per month)
- ✓ Free cash withdrawals at most ATM’s in Germany
- ✓ VISA or Mastercard for €29.90 per year
If you handle a lot of cash on a day to day basis, this company could be something worth considering because they have a lot of branches. All activities of the Commerzbank can be managed online. Think about account management, retirement or mortgage planning. This can all be done relatively easily at the Commerzbank.
Online or traditional banks?
Online banks and traditional banks have both their pros and cons. You must decide what fits best to your needs. Be smart about it! If you already have a savings account in the country of your origin, then you would be best if you go for an online bank with free cash withdrawal in Germany. If you don’t have a traditional bank in your country of origin, then it would be smart to go to a traditional bank. Traditional banks will help you to set up your account and help you with more complex transactions or other banking efforts. We have listed below the advantages of each banking method:
If you are up to date with current technologies, already use online banking and you want to keep a little bit more money in your pocket; online banking could be the best option for you. Some of the advantages of online banking are:
- Open 24/7: online banks are always open for business, unlike traditional banks. This is maybe the biggest advantage; no more waiting in line or waiting until the bank opens. You can arrange everything with a few clicks or if necessary, a phone call.
- Higher interest rates: online banks don’t have an office building in every city, which saves them a huge amount of overhead costs. This reduction in overhead costs enable online banks to give higher interest rates to their customers then traditional banks can.
- Better online tools and user interface: online-only banks must have a strong online presence and good tools, otherwise they can’t compete with existing banks. Last years, mobile banking has become more and more popular. Some traditional banks have not made the switch to mobile banking, but most of the online banks have. The FAQ’s on most online banks are more detailed then at a traditional bank and state clearly what their interest rates and fees are.
- Lower or even no fees: Most online banks offer a free checking account and you do not have to keep a 1000-euro minimum per month balance in order to pay extra fees. For a lot of traditional banks this is a normal procedure. Most online banks do not ask these fees because they have less overhead costs.
If you work with complex banking products or you value a banking relationship, traditional banking could be something worth considering. Some of the advantages of a traditional bank are:
- Customer service: talking to a banker with personal interaction, is for a lot of people still important. Face to face banking can be an advantage, especially if you deal with complicated banking products. Building a personal relationship with your banker can be beneficial since you get first-hand tips and advice.
- Access to banks or deposits: traditional banks often have multiple locations in one city. Therefore, it is easy to get your money directly from those banks. If you hand in a check to your bank, you can get your money relatively fast. If you send a check to your online bank this can take up to a couple of days before the check is processed.
- Wider scope of banking products: online banking is straightforward when it comes to the standard processes. When it comes to more complex products like credit loans, advanced investments or money market accounts, it is often better to go to a traditional bank. Online banks often also offer these services, but since there is a lot of money at stake and these are complex products, it would be advisable to talk to a banker about it first. Unless, you are the Warren Buffet of the online banking world and you know your way around!
One of the general misconceptions is that people think that traditional banks are more secure than online banks. Online banking transactions and other banking processes are heavily encrypted and your banking statements are as safe in an online bank as they are in a traditional bank. Maybe even safer, since you need explicit access to get to your online banking statements, but everything that is written on paper is ripe for the taking.
3 things to look for in a Bank
There are some factors you should take into consideration before choosing a bank. Some factors may be more important for one person than it is for the other. All in all, it is smart to keep these factors in mind when choosing the best bank in Germany.
#1. Tailored service
It is important that you know what kind of service you need. If you just want simple banking access with a savings and checking account- online banking would be the best option for you. If you are planning on performing more complex banking transactions or more complex banking processes, than it would be smart to go to a traditional bank. Moreover, do you want to do business in person and truly build a banking relationship, then I would strongly consider going to a traditional bank.
#2. Acceptable fees
All banks ask fees for some processes down the line. You must keep in sight on what is important to you. For example; do you go often to a ATM? There are banks that ask fees if you go to an ATM from another bank. Something else to consider is if you receive every month more than 1000 euro’s in your checking account? There are banks that ask for a 10-euro fee, if you don’t receive that amount in your account every month. If you are concerned about small extra fees, go for online banking. Their rules are clear and simple. These banks are more transparent about fees and you can find a lot of information about those fees in their FAQ’s.
#3. High interest
There are a lot of high-yield saving accounts today, and therefore it is important to take this factor into consideration. There can be quite a huge difference in interest rates from bank to bank. Receiving a profitable return for parking your money in a bank can be beneficial. Especially if you already have some capital on the bank, it could give you a profitable return on the end of the day. In general, online banks pay out higher interest than traditional banks.
Everybody is different, and therefore there is not one bank that can fulfil everybody’s needs. Therefore it is hard to say what the best bank in Germany is because everybody has other needs. One person likes to do business in person while to other is fine with the anonymity of an online bank. It does not have to be one or the other, you can also choose both! Open one account at an online bank and one at a traditional bank. In this way, you can use the best of both worlds. Use the benefits of an online bank – high interest rates and free ATM usage- and use the benefits of traditional banks- tailored service and personal assistance.
When it comes to online banks, DKB offers the best rates and benefits in the online banking segment. Furthermore, when it comes to traditional banks, Deutsche Postbank offers tailored service and is well represented within Germany. If you want more information about these topics, just have a look on the websites of DKB and the Postbank – they both have an excellent website where everything is clearly explained. If you don’t understand German that well, be sure to check their website with the trick we described on the top of the page. Good luck banking!