From now on there is the interest of the Trade Republic. These amount to two percent per year. However, the payment is made monthly which is even more attractive due to the compound interest. Behind this is once again a clever move by the neobroker.
Trade Republic has done it again. With the onset of the corona crisis, the Berlin neo-broker made trading shares in Germany socially acceptable. Instead of expensive transactions at its own bank, the provider has managed to bring the world of stocks to smartphones.
Commercial Republic interest: 2% per annum, paid monthly
And the start of 2023 couldn’t be more spectacular. Because for the current year, the creators of the trading app have come up with a special treat for their users.
So now there is – more precisely since the official press release on January 4, 2023 – now of interest to Trade Republic.
In particular, the interest amounts to two percent per annum. However, the prorated payment is always made on the first day of the month. As a result, the effective interest rate is even higher due to compound interest.
With an effective annual interest rate of 2 percent, we are passing on the benefits of the new interest rate environment directly to our customers. Every investor can now directly and easily benefit from interest.
This says Christian Hecker, co-founder of Trade Republic. The respective credit arrives in your clearing account on the first bank day of the month. You can then simply see the exact value of interest earned in your profile timeline.
Interest on balances up to 50,000 euros, deposit protection takes effect normally
Specifically, Trade Republic pays two percent for a credit of up to €50,000 on the clearing account. Other investments are protected under the deposit guarantee scheme up to an amount of EUR 100,000. However, the difference no longer generates interest.
This means that interest is theoretically possible with a balance of EUR 50,000 in the compensation account per year – without compound interest.
There are certainly other banks and financial service providers on the market that are starting to pay interest on savings and checking accounts again. However, only a few financial institutions exceed the value of the Merchant Republic’s interests.
How long is the offer of the interests of the Commercial Republic valid?
If you read the press release carefully, you will see that “the offer is not limited in time”. “In the current market environment, interest rates apply until further notice.” This wording is smartly chosen because it leaves little leeway for changes.
And indeed, a look at the confirmations FAQs:
According to our terms and conditions, this rate is subject to change. There are a number of macroeconomic factors that can cause the interest rate to change, including changes in the key interest rate as part of the ECB’s fiscal policy. We will notify you of any changes before they occur.
However, it must be assumed that the offer will remain in place for some time due to the current interest rate policy. Furthermore, the counteractions would also ensure that Trade Republic is brought into disrepute, which in turn would damage its image.
It is therefore more of a clause that could gain importance in the distant future.
Trade Republic positions itself as a favorite with savers
With the launch of the Merchant Republic interest rates, the neo-broker made a smart move. On the one hand, the move has garnered a lot of attention on social media and discussion forums. This marketing effect should not be underestimated.
However, it doesn’t stop there. The interest on unused money in the clearing account also makes the trading app attractive to users who just want to get their money to work. Because theoretically there is no need for interest to also trade in stocks.
As a result, Trade Republic is once again significantly expanding its potential target group. Because the corresponding clearing account and registration with Trade Republic takes only minutes.
By the way: You have to activate the Commercial Republic interest manually. To do this, simply click on the corresponding banner in your app and then accept the terms and conditions. If all went well, you’ll see “You’re interested” below your course history.
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