The end of crisis rates

Some banks had significantly reduced the interest rates for overdrafting the current account due to the Corona crisis. It’s over now. In some cases, bank customers expect interest rates to double to more than 10 percent.

Frankfurter Sparkasse was one of the first institutions in Germany to significantly reduce overdraft interest due to the Corona crisis - to relieve customers.

EA number of banks and savings banks in Germany that temporarily significantly reduced their overdraft rates for private customers due to the Corona crisis have now returned to the pre-crisis values. In part, this means for the customers about a doubling of the interest rates that are required by the institutions for an overdraft of the current account within the agreed framework (“overdraft facility”). In some cases, the limit of 10 percent overdraft is exceeded again. Most institutes have apparently not extended the corona regulation, even if the corona crisis is certainly not over yet. Some of the institutes raised interest rates again at the beginning of July – others now in August.

What’s behind it? The credit institutions had justified the temporary lowering of their overdraft rates with the fact that they wanted to provide their customers with a certain amount of relief, because they were in some cases heavily burdened by the Corona crisis. The tighter it gets economically for many people, the more will eventually slip into the overdraft facility, it was said at the time. Therefore, one wants to relieve the loyal existing customers a little at least at this end.

However, by far not all banks participated. Even the associations of the banking industry could not bring themselves to a nationwide appeal. Apparently, even the banks that participated do not want to continue indefinitely.

Frankfurter Sparkasse was the pioneer

Frankfurter Sparkasse, which was one of the first to lower the overdraft interest rate during the Corona crisis, returned to pre-crisis levels on July 1st. From April 1 to June 30, the overdraft rate for existing customers was temporarily 4.99 percent per year, said a spokeswoman. “As announced at the time, the interest rate is now back at the previous level, namely at 10.49 percent.”

At the beginning of August, the overdraft interest rates were raised again at the cooperative VR Bank Coburg in Franconia. From May 1 to July 31, the crisis interest rate was 4.75 percent, said a spokesman. Now it is again 6.75 percent per year. The Sparkasse Neubrandenburg-Demmin in Mecklenburg-Western Pomerania had lowered its interest rate to 5.99 percent by June 30th. “Since July 1, the standard condition has been in effect again,” said a spokeswoman. According to the price announcement, that’s 9.95 percent. Sparkasse Münsterland-Ost lowered its overdraft interest for new customers from 10.4 to 9.5 percent some time ago, and that for existing customers during the crisis to 4.99 percent. The latter has now been lifted again, said a spokesman: “Since July 1, the overdraft interest rate of nominally 9.5 percent has been in effect again.”

The Taunus Sparkasse is apparently an exception

An exception is apparently the Taunus-Sparkasse in Bad Homburg. Oliver Klink, the institute’s chairman of the board, said on request on Monday that they did not want to pretend that the crisis was over. In any case, the overdraft interest would remain at the lowered level until December 31st. The Taunus-Sparkasse had reduced its overdraft interest due to the Corona crisis from 9.93 percent to just under 5 percent a year.

The organization “Finanzwende” of the former Green Bundestag member Gerhard Schick criticized the restart of the overdraft interest rates. “The short-term lowering of the overdraft interest by some banks and savings banks was probably just a marketing gag,” said Julian Merzbacher from “Finanzwende”. The financial crisis caused by Corona is far from over for many households. On the contrary: The crisis is only now becoming really painful, especially for millions of people on short-time work, some of whom have been able to draw on their reserves up to now. “Above all, surprising burdens are then often financed in the short term via the overdraft facility,” said Merzbacher.

Banks that had not lowered their overdraft rates during the crisis argued, in part, that it does not matter that much for each individual customer, that this would not solve the crisis problems. There had been a real political dispute over the subject in Saarland. Oskar Lafontaine, parliamentary group leader of the Left in the Saarland state parliament, had asked the Saarland savings banks to follow the laudable example from Frankfurt and to relieve the Saarlanders through lower overdraft rates. The savings banks in the western state reacted rather coolly – they referred to the easing measures for customers with building loans that had already been implemented with great effort.