Exploring Interest Rate Platforms: Opportunities and Risks for Savers

Interest rates in Germany have risen – but in other EU countries there are sometimes even better interest rate and fixed-term deposit accounts. So-called interest rate platforms refer German savers there. This brings more returns – but also more risk. Consumer advocates warn: Money should not be invested everywhere.

French banks currently have the highest interest rates

They are called Weltsparen, Zinspilot, Check24 or Zinsmarkt. In the interest rate comparisons Stiftung Warentest The offers from the four interest rate platforms often take top positions. “The interest rate portals have stimulated competition. They enable savers to benefit from the sometimes higher interest rates abroad,” says Uwe Döhler, project manager at the foundation.

This works, for example, with fixed-term deposits with a one-year term: According to the foundation’s current overview, savers can earn 4.75 percent by brokering the Zinspilot portal to the French BGFI Bank Europe. This means that this offer is currently in first place in the foundation’s comparison. Second place goes to an offer from the Weltsparen portal with 4.25 percent, which savers can get through brokering with the French Orange Bank. At most German banks the interest rate is far lower.

Interest rate platforms: Convenient registration is an advantage of the portals

How does the investment work? After registering with an interest rate platform, the customer can freely choose from the offers of all partner banks on this platform. A single account and a single identification are sufficient for this. If a saver wants to switch to another partner bank on the portal, they do not have to identify themselves again using a video or post-identification process, which many find annoying. This also allows you to easily switch between the platform’s daily and fixed-term deposit offers. “That’s the big advantage of the portals,” says project manager Döhler.

According to the foundation’s experience, the processes are largely smooth. “The complaints about interest rate platforms are very, very limited; we only know of a few individual cases,” explains Döhler. According to him, the foundation has now included around 900 platform offers for fixed-term deposits in its comparisons – around 300 more than a year ago.

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How safe is savers’ money abroad?

Is my money safe abroad? Opinions are divided there. The platforms advertise that the money invested through them is protected by the “EU deposit insurance” up to 100,000 euros per customer and institution. This corresponds to the legal minimum coverage in the EU. In the event of a bank failure, customers must be able to be compensated within seven working days.

However, consumer advocates have doubts as to whether the national security systems in all EU states are already equipped to meet this requirement. Some consumer advice centers only recommend investing in banks with German deposit insurance. “The portals advertise EU deposit insurance and thereby suggest a security that actually doesn’t exist,” says Niels Nauhauser from the Baden-Württemberg consumer advice center.

Savers should (not) invest in these countries

Stiftung Warentest doesn’t go so far as to say that only the German deposit insurance company can be trusted. However, she advises against countries that do not receive top ratings for their economic strength from all three major rating agencies, Fitch, Moody’s and Standard & Poor’s. “The interest rate portals claim that the security is the same at all institutions. However, we do not have joint liability among the EU states, but rather 27 national security systems,” explains Döhler from Stiftung Warentest.

He warns: “The problem is that there are many institutions listed on the portals that we do not recommend.” For example, the foundation advises against investments in Bulgaria, Greece, Italy and Latvia – even if the interest rate platforms there have partner banks that often pay absolute top interest rates. In other countries such as Belgium, France, the Netherlands, Austria and Sweden, however, the foundation gives the green light. Be careful, however, with Sweden: Because of the exchange rate risk, the foundation recommends only investing a maximum of 85,000 euros there, so not completely exhausting the EU maximum deposit protection limit of 100,000 euros.