Banking in Germany — Girokonto, IBAN, and SEPA
A German Girokonto with an IBAN is the gateway to salary, rent, utilities, and almost every consumer contract. Online banks open in days from a video call; high-street banks are useful for cash and in-person services. Here is how the pieces fit, in order.
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- Currency
- Euro (EUR, €)
- Account format
- IBAN — DE + 20 digits
- Deposit insurance
- €100,000 per depositor per bank under EU rules
- Instant transfers
- SEPA Instant — most major banks; sometimes a small fee
Online banks, direct banks, and high-street: pick at least one of each
Online and direct banks (N26, ING, Comdirect, DKB) open a free Girokonto from your phone in 1–7 days using a passport and a video-ident or PostIdent verification. You receive a German IBAN immediately. Most charge no monthly fee for active accounts; some require a minimum monthly inflow (typically €700) to remain free.
Sparkasse and Volksbank are the two cooperative high-street networks — densest branch and ATM coverage, useful when you handle cash, want in-person service, or live in a small town. Their Girocard works at small businesses that do not accept Visa or Mastercard, including many German bakeries and cafés. Monthly fee around €5–10; in branch you can deposit cash, request bank drafts, and get notarisations.
A common newcomer pattern: online bank for daily payments and salary; Sparkasse or Volksbank as a complement for cash and the Girocard. ING and DKB also issue free Girocards, narrowing the gap.
Anatomy of a German IBAN
A German IBAN is "DE" followed by 20 digits. The first 8 digits identify the bank (the Bankleitzahl), and the last 10 are the account number. SEPA transfers within the eurozone use only the IBAN — the BIC/SWIFT code is no longer required for domestic SEPA payments.
Most German salary payments and bills run on standard SEPA (1–2 business days) or SEPA Instant (under 10 seconds, available 24/7 since the EU mandate kicked in). Many smaller banks now offer Instant for free; others still charge €0.50–1.00 per Instant transfer.
SEPA Direct Debit vs Standing Order — pick the right one
A SEPA-Lastschrift (Direct Debit) lets a company pull a variable amount on a schedule (utilities, internet, gym memberships, insurance). Banks legally guarantee refunds within 8 weeks if a company takes the wrong amount — log into your bank app, click "Lastschrift zurückbuchen", done. Reversing fraudulent direct debits up to 13 months out is also possible.
A Dauerauftrag (Standing Order) is the opposite: you push a fixed amount on a schedule (rent to a private landlord, regular savings transfers). Standing orders never auto-adjust and never auto-cancel; you have to amend them yourself.
Cash is still common — and Girocard is not Visa
Germany was famously slow to digitise payments and cash remains common at bakeries, smaller restaurants, market stalls, and even some doctors' offices. Always carry €20–50 of cash for small purchases. ATMs (Geldautomat) are dense everywhere; use your bank's network or partner ATMs to avoid the €4–6 fee for using a competitor's machine.
The German Girocard (formerly EC Karte) is a domestic debit network, separate from Visa and Mastercard. Most Girocards now also carry a co-badged V Pay or Maestro logo for use abroad — but don't assume; check before travelling. Many small German shops accept Girocard but not Visa or Mastercard.
Saving and investing — Tagesgeld, Festgeld, and Depot
A Tagesgeldkonto (instant-access savings) currently pays around 2–3% on call deposits — better than checking account balances which usually pay nothing. Trade Republic, ING, Consorsbank, and the direct banks compete on rate; rates fluctuate with the ECB.
Festgeld (term deposits) lock money in for 6–60 months at slightly higher rates. Use only for cash you definitely will not need, since early withdrawal forfeits interest.
For investing, a Depot (brokerage account) at Trade Republic, Scalable Capital, ING, Consorsbank, or Comdirect lets you buy ETFs and stocks. The German tax wrapper is the Freistellungsauftrag (€1,000 per person per year tax-free interest/dividends) — set one up at your broker on day one. Above that, capital gains and dividends are taxed at 25% Abgeltungsteuer plus 5.5% solidarity surcharge.
Schufa: the German credit-reporting system
Schufa Holding AG is Germany's dominant private credit bureau. Almost every consumer contract — rental application, phone contract, financing — checks your Schufa score. Foreigners arrive with a blank file, which is treated as neutral, not negative; activity (paying rent, paying phone bills, paying card bills) builds the file over 6–12 months.
You can request a free Schufa-Auskunft (the version landlords ask for) once a year at meineschufa.de or via Bonify free. It takes 2–4 weeks by post — do this in your first month so it is ready when you start apartment hunting.
Fraud reporting and security
The most common consumer-fraud vectors in Germany are phishing emails impersonating banks ("Ihre Sparkasse fordert Sie auf...") and SIM-swap attacks targeting bank-app TANs. Real banks never ask for your PIN, never ask you to click a link to "verify" your account, and never call you to push a transfer.
If you suspect fraud: lock your account immediately via your bank app, call the bank's 24-hour line (printed on the back of the card or in your contract), and report to the police (online via the Onlinewache of your state police). The €100 EU consumer-fraud-loss cap means most banks reverse genuine fraud entirely.
Further reading
Other guides for this country
Frequently asked questions
Can I open a German account before I have an Anmeldung?
Most online banks (N26, ING, Comdirect, DKB, Wise, Revolut) open accounts without an Anmeldung. Some require you to file your registration address within a few weeks of opening. High-street banks usually require an Anmeldung first, though some branches are flexible for newcomers with a residence permit and a clear address.
How fast do German transfers arrive?
Standard SEPA: 1 business day domestically; up to 2 days within the EU. SEPA Instant: under 10 seconds, available 24/7. Most major banks now offer Instant for free; check the fee schedule before sending if your bank charges for it.
Is my money safe?
Yes. EU-mandated deposit insurance covers up to €100,000 per depositor per bank. Most German banks (especially private ones via the BdB Einlagensicherungsfonds) cover well above that — Sparkassen and Volksbanken are also covered through their own institutional protection schemes. Major retail banks are well-regulated; the risk surface is fraud, not insolvency.