How to Open a Bank Account in Germany
Last updated: 17 April 2020 / by Sam Williams
A note about COVID-19: This guide is based on the general rules, but there may be some temporary restrictions in place due to the presence of the COVID-19 virus. We are keeping the situation under close review and will update our guidance as necessary.
Getting a bank account sorted should be right at the top of your list of things to do when you move to Germany. Without a bank account, you will not be able to organize essentials such as renting an apartment or setting up your utilities. You will not even be able to get your wages paid!
The world of banking can be confusing even in your home country, so this guide covers everything you need to know about opening a bank account in Germany.
Types of German Banks
In Germany, you will find banks are split mainly into three broad categories:
Private commercial banks
These make up the largest sector, with around 40% of German banks falling into this category. Two-thirds of commercial banks are part of big, centralized chains with approximately 200 smaller regional private banks.
Public savings banks (known as Landesbanken and Sparkassen)
The government owns and controls public savings banks, and they can be found all over the country. Sparkasse are the local banks that can be found in most cities. There are seven Landesbanken; these are the regional banks that are in each state.
Co-operative banks (known as enossenschaftsbanken)
There are approximately 1000 co-operative banks in Germany, the vast majority of which operate as part of the Volksbanken Raiffeisenbanken group. Co-operative banks differ as members are also their shareholders and their interests are paramount in making decisions.
These three groups of banks can be broken down further into those who maintain a brick and mortar presence and those who are an online or mobile banking service. Some banks offer both, but increasingly Germans are embracing digital services.
ATMs can be found in many places across Germany, not only in banks but in train stations, supermarkets, and petrol stations. Even if you usually prefer to pay by plastic, you’ll need cash while in Germany. The country is slowing coming to terms with payments by card and other means, but in many places, only cash is accepted. This is as true in city locations as more rural areas; overall Germany has a much higher dependence on cash compared to other European nations.
German banks usually allow their customers to use the ATM for free, but that’s not the same for customers of other banks. Many will charge a fee of €3-5 per transaction if you want to use an ATM that belongs to another bank. Some banks have struck a partnership deal to offer fee-free ATM services. Once you decide which bank to join, look out to see what’s available.
German Bank Accounts
Before applying for a bank account, you will need to know what type of account it is. There are four main types of bank account available in Germany:
- Girokonto – a current account
- Tagesgeldkonto – instant access savings account
- Sparkonto – restricted access savings account
- Depot – securities account
The types of card issued with the bank account can be misleading. The girocard, which is often issued with a German bank account, can be used for chip and pin style payments in shops and restaurants, where accepted but it’s not a “full” debit card. It’s frequently co-branded with Maestro, which is sufficient for payments where you are physically present but can’t be used for online purchases.
To use your bank account to pay for goods online, you’ll need a Kreditkarte. This can be confusing as this is the term used both for a full debit card and a credit card. A credit card normally carries an annual fee, so be clear about what you’re receiving with your account, and what it will cost.
If you choose to apply for a credit card, make sure you understand the repayments. Credit cards in Germany don’t work in the same way as in other countries, as you will be typically expected to make the repayment in full every month. Some credit cards will allow you to carry a balance over to the following month, but this isn’t commonplace.
How to Choose a Bank
German banks are among the best you’ll find anywhere in the world, but this doesn’t mean that every bank will meet your needs.
As a foreigner living in Germany, you might be looking for particular features that aren’t available at every bank. Specifically, you will find some that offer services designed to support ex-pats and their needs.
Before signing on the dotted line for a bank account, consider the following:
If you are very fluent in German and comfortable reading small print, this won’t apply to you. However, if you don’t speak German or are still improving your language skills, finding a bank that also offers its services in English will be a huge benefit.
Not every bank in German will also provide the option for English. It’s more commonly offered by online providers.
Convenience and Safety
Banks that offer a mobile banking app are a big plus. This doesn’t just provide convenience for you to check your account while on the move, it can also provide protection. Features such as notifications when your girocard is used provide you with the facility to instantly lock your account.
Despite the prevalence of mobile banking in other countries, it’s not yet offered universally by every bank in Germany. If you need it specifically, ask the bank before opening an account there.
This is where having a bank offering their service in English can be a major benefit as understanding the fee structure can be tricky.
Many German banks charge for their services, but it is possible to find free bank accounts too.
Branch banks are more likely to charge a fee, as they have greater overheads to cover. These fees are charged monthly and are charged for the privilege of having a bank account.
Some banks offer specific services for free if you keep your account balance above a certain level. If you dip below this, you may start to get charged a monthly fee, so double-check whether this restriction applies to your intended account.
Many banks supply a free girocard (a type of debit card), but if you want the accompanying credit card, there’s an additional fee. The fees can be substantial, ranging typically from €30 to €100 per year.
The Big German Financial Institutions
With the global economy continually shifting, the banks available and the services they offer are also ways subject to change, but here are some of the biggest financial institutions in Germany.
- Comdirect – a subsidiary of Commerzbank, Comdirect is an online bank that includes a debit and credit card for account-holders.
- Commerzbank – one of the largest banks in Germany with a big network of branches.
- Deutsche Bank – the largest bank in Germany and renowned internationally. Offering a vast range of services.
- DKB (Deutsche Kredit Bank) – an online bank with low fees and access to ATMs.
- HypoVereinsbank – a very large bank that is part of the Italian Unicredit group, they only offer services in German and to qualify for some accounts, there’s a minimum deposit.
- N26 – an online bank which was set up in 2013, it is specifically geared towards the expat market and offers services in English.
- Netbank – an online provider which uses ATMs from other providers for its customers
- Postbank – now a subsidiary of Deutsche Bank, they have an enormous network of ATMs, but there are some minimum levels to qualify for their free girocard and savings account.
- Sparkasse – a not-for-profit public service that has ATMs and branches throughout the country.
The central bank for the country is the Deutsche Bundesbank and the regulatory authority is known as BaFin, The Federal Financial Supervisory Authority.
What Documents Do I Need to Open a Bank Account?
Every bank will have its own unique procedure; this may permit the online submission of documents or you may have to go into the branch for verification.
In some cases, you can open your bank account via the Post Office, using a service known as PostIdent, which collects your documentation on behalf of the bank.
When using PostIdent you will need to download a verification form from your bank and take it with your documentation to the Post Office.
Some of the documentation you might be asked to provide includes:
- Your passport
- Proof of address
- Proof of immigration status, where applicable
- Proof of employment and income
- Completed Anmeldung
- SCHUFA credit score
If you are opening the bank account online, you may be asked to verify your identity using a webcam and an email verification code.
Some banks will have quite strict standards for acceptance, so the more evidence you can provide, the better. Having your Anmeldung plus a guaranteed income from your employer will be an advantage when they’re assessing your creditworthiness.
The Importance of SCHUFA
When you are living in Germany, you will hear SCHUFA mentioned by many parties, including potential landlords, banks and on any credit applications. SCHUFA stands for “Schutzorganisation für Allgemeine Kreditsicherung” and is an agency that holds the credit records of anyone living in Germany.
SCHUFA operates in a similar way to Experian or Equifax, two global credit reference agencies you may already be familiar with. All your financial transactions will be listed here, such as utility bill, loan and credit card payments.
If you are late paying any of your bills or they are overdue, your credit score will decrease. Conversely, keeping your financial affairs in good order will improve your SCHUFA score.
Your SCHUFA account is created after you complete your Anmeldung, so at the start, it will look empty. For some banks having an empty SCHUFA is as problematic as having one with negative entries, so the sooner you can start proving that you are reliable in paying your bills, the better your score will be.
Your salary, general wealth and other assets will have no reflection on your SCHUFA score. It’s all based on your credit behavior and designed to reflect how much risk you would present to a lender.
Some potential landlords will also insist on seeing your SCHUFA before accepting you as a tenant, so having a bad score can be very detrimental.
Refused for a Bank Account?
If you don’t meet the standards for a bank account yet because of SCHUFA, don’t panic.
The German online bank N26 offers bank accounts for German residents without the need for a credit check.
This means if you have only just moved to Germany and haven’t had time to build up a decent credit score, you can still access a bank account for all your needs.
Even with a good SCHUFA score, N26 is a bank that’s often chosen by ex-pats because it’s designed to meet the needs of foreigners arriving in Germany.
They offer a full interface in English as well as German, and they also provide customer service support in five languages, including English. Therefore it’s widely regarded as the best bank in Germany for foreigners.
N26 has several different types of bank account, including a free option which includes 5 free ATM transactions every month and a MasterCard debit card.
You won’t earn any entries on your SCHUFA by registering for an N26 account, but it will give you the time to build up your score from other means such as phone bills and paying your utilities.
As N26 is an online-only bank, you won’t find any branches in your town or city. They offer customer service via a live app chat, and the application process takes around 10 minutes, via a webcam and emailed pin number.
To apply for a bank account, you’ll only need your passport or ID card, not any other documentation.
Another benefit of N26 is that it has bank accounts specifically for freelancers and the self-employed. As many foreigners coming to Germany are in this type of employment, it’s a trendy choice.
A Handy Glossary
Even if you speak enough German to get by in everyday life, you may not be familiar with some of the terms that are used in the banking world. The following may be useful to know:
- Aktuelles Nettoeinkommen pro Monat in Euro – current net monthly income in Euros
- Anmeldung – registration
- Bankleitzahl – sort code (eight digits long)
- Bargeld – cash
- Disposition Kredit (DispoKredit) – overdraft protection (loan) usually associated with a premium account
- EC-Karte – the defunct term for a Girocard (may still be seen in some places)
- Geldautomat – ATM
- Girokanto – a current account
- Grundpreis – basic fee
- Kontoführungsgebühren – bank account fee
- Kontoinhaber – account holder
- Kontonummer – account number
- Pflichtfeld – required field (as used on a form)
PostIdent – often used for online banking, the Post Office verify identity
- Sparkanto (or Sparbuchkonto) – a savings account
- Sperrkonto – a type of locked account used in connection with visas
- Studentenausweis – student ID
- TAN – unique code required for online transactions
Überweisung/Geldüberweisung – money transfer
- Zinsen – interest which is either paid to you or by you
Apply For Your Account
This guide provides all the information you need to start applying for your German bank account – all that is left for you to do is decide which bank is right for you!
Use the questions listed above, and you will soon find the bank that meets your needs for living in Germany.