How do I open a German Bank account as an expat?

Bas Teunissen

Aug 14 • 7 minute read

When moving to a different country, it’s obviously very important to have access to your funds, as well as to have the ability to easily make and receive new payments in the country. After all, you want to collect your salary and pay your bills with as little hassle as possible. So, let’s take a look at how you open a German bank account as an expat moving to Germany. We’ll help you figure out the basics of banking in Germany, along with the local trends, options and keep it simple by listing the most expat friendly options for your situation as a student or expat.

Do I need a German bank account as an international?

Chances are, you’ve already got a bank account and savings at a bank in your country of origin. So, do you even need to get a local account? Short answer: not necessarily. For example, your bank might have a branch or partner bank in Germany that will allow you to quickly set up a local account. Or, if a German shop also accepts VISA, Mastercard or American Express cards, paying across different currencies could rack up your charges.

So, the long answer is: you might want to get one anyway. It all depends on your situation and prospects in Germany. Having a German bank account can make some of the processes of moving to and living in Germany a lot easier. So, for that, we’re taking a look at the basics of German banking and what the best option is for you, based on whether you’re staying for a limited period of time, or if you’re in Germany for the long haul.

German banking basics

German banks generally offer 2 types of bank accounts: a standard account (Girokonto) for normal bank transfers and card usage, and a savings account (Sparkonto). Yes, you’re right, Konto is the word for account! Germany has 3 different types of banks: Banken, Volksbanken und Sparkasse. The difference between these three are basically the "owner":

  • Banken: Private money institutions (e.g. Deutsche Bank).
  • Volksbanken: is owned by its community, you need to eb a member to open up an account here.
  • Sparkasse: A public bank that usually belongs to the city.

The accounts at these local banks are often reserved for either German citizens or at the very least, people with a German address. But I’m an expat, what do I do?! No worries, you essentially have two options:

Short stay: a bank account with an online bank

One of the simplest options for your new adventure is to set up a bank account with an online or mobile bank active in Germany. These digital banks don’t have an actual physical location, but will send you a bank card (usually Mastercard) that you can use at almost any ATM in Germany. They also provide contactless payments and enable you to send and/or receive regular bank transfers. This makes it an ideal option for newly-arrived expats, international students and interns who are unable or do not want to set up a local account before arriving in Germany. If you know you’re only going to stay for a few months or up to a year, without making use of any complicated services like mortgages or loans, an online bank account might be the best option for you. We’ve selected 2 of the easiest online banks for you to consider!

what to consider when choosing a German bank

Hold up! There are some things to check up on, regardless of whichever bank you choose. I could list the numbers here, but you should be checking the bank’s website (or ask their customer service) about these numbers because they are subject to change quite frequently.

  • Cost. Some (online) banks have free accounts. Others charge a monthly fee, so make sure you know what you’re getting into. That said, some paid accounts might offer features or insurances you might want to make use of.
  • Fees. As an expat, free international transfers, currency exchange rates and fees (or lack thereof) for ATM withdrawals can make a world of difference.
  • Services. Does the bank offer English language customer service? Also, regular banks often offer useful services such as health, vehicle or home insurance.

N26

N26 started as a German startup from Berlin! Now they’re one of the most popular online banks, offering both regular accounts, as well as (pre-paid) credit cards. As online banks kind of expect you to, well, do your banking online, there are usually fees involved when making withdrawals. However, N26 does offer a fair withdrawal policy for their free accounts, allowing you to make 3 free ATM withdrawals per month. So, you can use your N26 card for online and scheduled payments, while still withdrawing money to use at the local market without any fees. Verification for an N26 account is done completely online, by supplying them with your ID, as well as a selfie taken while making the account. Additionally, they don’t require a Meldebescheinigung (proof of residency) that most banks use to prove you live in Germany. This makes it easy for you to set up the account before you arrive in the country, for example.

Bunq

Bunq is a Dutch online bank that has been active in Germany since 2017. Though they have no free option (accounts start at €7,99- a month), they allow up to 10 free ATM withdrawals per month as well as access to multiple bank accounts through one bank card. The way this works is that depending on which PIN code you use, you can pay from an account of your choice. Pretty neat! Additionally, any money you have on your bunq account is protected up to €100,000 by the Deposit Guarantee Scheme of the Dutch National Bank (DNB). Basically, if Bunq were to go out of business, you won’t lose your money. Unless you’ve got anything over 100k stashed away on your online account.

Online payment culture in Germany

As far as online shopping goes, most webshops will allow you to pay online, either using your online banking platform and/or mobile banking app. Other popular payment services include PayPal and Klarna. So, if you want to use some of your funds from a non-German bank, PayPal could be an easy option as well. The most popular option is paying on an account. Using a service like Klarna, for example, allows German consumers to receive a product without paying up front. Instead, you can pay after 14-28 business days or return the product within this window. Over 4 in 10 Germans prefer this payment method (ecommercegermany.com, 2018), so feel free to do the same!

Cash culture in Germany

Despite being one of the largest and important economies in the EU and even the world, Germany was behind in terms of the adoption of modern payment methods. In short, cash has been king in Germany for a long time. While bank transfers are used for larger transactions, trying to do your shopping at the grocery store or buying your drinks at the bar could still run you the risk of being unable to pay if you depend on your debit- or credit card alone. Or they do allow you to, but only above a minimum threshold (e.g. only for €10 or more. So, the ability to be able to withdraw cash from an ATM is a very important perk! That said, most banking options allow you to do this, but it makes it all the more important to weigh any withdrawal and or conversion fees into account.

Cash culture after COVID-19

But, it’s 2020, and we all know what happened. The virus has everyone in social distancing mode. So many of the trends that were already happening and services that were already available, such as working from home or the delivery of groceries, have seen a massive surge in demand. In Germany in particular, this has put a dent in the cash culture. So, these days, paying with the banking app on your phone, NFC contactless payments with your card are becoming a lot closer to being the new norm.

Long stay: a bank account at a German Bank

If you’re in Germany for a longer period of time, you could do worse than to have a bank account at a local German bank. Especially when you need some of the more advanced banking services, such as a mortgage or loan. So, which German banks are the most friendly towards expats like you?

Which German banks are the most expat friendly?

If you want to get a head start before you arrive in the country, an international bank is probably your best option. You open an account at your local branch (chances are your current bank also has a branch in Germany) and then have it transferred to the German branch of the bank.

Four well known international banks that offer these kinds of services are

  • ING
  • HSBC
  • Citigroup
  • Deutsche Bank (for our American and UK friends, DB has a partnership with Bank of America and Barclays).

Which documents do I need to set up my German bank account?

If you do opt to open a bank account at a local German bank, you’ll need to provide a number of documents for them to consider your application. It’s best to have these documents ready to go, to show that you’re well prepared. Why? Well, German banks can very easily reject your application if they feel something is fishy or they’re not confident that you meet their standards.

  • A copy of a valid passport or photo ID. Are you who you say you are?
  • A copy of your visa or residence permit. Remember, though, some banks only allow German residents to open an account.
  • Proof of address. Many German banks need you to have a German address to open an account. Please note that your booking confirmation from HousingAnywhere can often be used as proof of address.
  • Evidence of income/employment. Required by most banks, depending on the account you want to open. Many banks also need you to make a minimum deposit to open an account. Additionally, having your salary (or a minimum amount) on a monthly basis can get you additional benefits as well!
  • Proof of enrollment. This may replace a proof of income, as well as allow you to open special student accounts that have reduced fees and other benefits.
  • SCHUFA credit rating. A credit rating report required by some banks. You can request this report online, for around €29,99. Remember, though, that you will need a German address to get a report. This can be a circular issue for many expats! They can’t get SCHUFA because they don’t have a German address, and they can’t get a German address because they lack a SCHUFA report. Thankfully, most German landlords on HousingAnywhere don’t require a report, so it’s a great means to get a foothold in the country without any hassle.

In short

Setting up a German bank account before moving to Germany can be quite the hassle. Thankfully, having an international bank active in Germany or joining an online bank can help you get started with your finances before you even arrive in Germany. Depending on how long you stay for, you could keep using these direktbank options, but if your stay is permanent, you probably could also use a regular bank account. This allows you to make use of more advanced banking services, such as mortgages, loans, or investment services.

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