The government wants to issue a government bond that can compete with the savings account.
Finance Minister Vincent Van Peteghem (CD&V) is considering competing with the banks with a special government bond. There may be a government bond with a term of one year that would yield better returns than the most attractive savings books on the Belgian market.
Now government bonds are issued with maturities of three, five and seven years. But in September there will be an issue of a voucher with a term of one year. This term corresponds to that of the savings books. After all, the fidelity premium is acquired if the money remains for a year. Currently, the Belgian one-year interest rate is 3.69 percent. After deducting a commission for the banks, this would yield a gross return of 3.19 percent. If the withholding tax is also deducted, the net return would be 2.23 percent. To make the product more attractive, Van Peteghem is considering halving the withholding tax for this product to 15 percent. That would bring the net return to 2.71 percent: more than the best-yielding savings accounts.
As the new issue is scheduled for September, it is still unknown what the final return will be. After all, that depends on the market interest rate. ‘But we do want to enter into direct competition with the savings accounts,’ said Van Peteghem in parliament. “We want to fuel that competition.”
‘Too great risk’
He prefers this scenario rather than the e-Depo account of the Deposito- en Consignatiekas. It quickly became very popular due to the high interest rate, but Van Peteghem has now capped the interest rate. The institution is not intended to manage large amounts of savings. In addition, the immediate retrieval of savings is a problem in the management of the national debt. ‘The ceiling makes the effect on the debt and the budget manageable,’ said the minister. ‘An interest rate that is too high otherwise constitutes too great a risk.’
State Secretary for Budget and Consumer Affairs Alexia Bertrand (Open VLD) emphasized in the Chamber that the interest on savings books has indeed risen. ‘There is a clear upward movement, albeit less quickly at the major banks. But last Friday, three banks announced a rate hike. That satisfies me, but it is not enough, although of course it is not up to me to determine what is sufficient.’
Bertrand also believes that consumers should be made more aware of the possibilities of receiving a more attractive interest rate by shifting savings. But a legal initiative must be approached with caution, as the National Bank and the European Central Bank have warned against risks to financial stability.
2023-07-04 09:14:57
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