Banking in Germany

A German current account (Girokonto) is the foundation of your financial life here. You need it to receive your salary, pay rent by SEPA transfer, set up direct debits, and access your money via card. Most landlords and employers expect you to have a German IBAN.

The good news: Germany has one of the most competitive free-account markets in Europe. You do not have to pay a monthly fee. The deciding factors are whether the bank offers English onboarding, whether it accepts newcomers without a Schufa record, and which features matter most to you (cash withdrawals, a physical branch, investment options).

Which banks accept newcomers in English?

The table below shows the four most relevant providers for expats and newcomers. All four accept customers who have just registered their address in Germany and have no Schufa history yet.

Card payments work differently in Germany than in most countries newcomers come from. Two card types dominate, and they are not interchangeable. Understanding the difference between a Girocard and a credit card saves you from the most common payment surprise: standing at the till in a bakery or restaurant that takes only one of them, or only cash.

Germany has historically been a cash-first society, and while that is changing fast in cities, many smaller businesses, bakeries, kiosks, and family-run restaurants still accept only the Girocard or cash, not credit cards. Carrying both a Girocard and at least a little cash is the safest combination for daily life.

Why the distinction matters for newcomers

If you come from the UK, US, or most of Asia, you are used to your debit or credit card being accepted everywhere. In Germany, your foreign Visa or Mastercard will be declined at many local businesses that only have a Girocard terminal. This is not a problem with your card, it is the German payment landscape. The solution is to open a German account that gives you both a Girocard for local payments and a Visa or Mastercard for everything else.

Free credit cards worth knowing

Several German providers offer credit cards with no annual fee and no foreign transaction fees, which makes them ideal for newcomers who travel or shop internationally. The table below shows the most relevant options.

If you have been in Germany for more than a week, you have probably heard the word Schufa. It comes up when you try to rent a flat, sign a phone contract, or apply for a credit card. Understanding what it is – and what it means for you specifically as a newcomer – saves a lot of confusion.

The Schufa (Schutzgemeinschaft für allgemeine Kreditsicherung) is a private credit bureau that collects financial data on around 68 million people in Germany. Banks, landlords, and service providers use its data to assess how likely someone is to meet their financial obligations. It is similar in concept to Experian in the UK, CIBIL in India, or the three-bureau system in the USA – but the data it collects and shares works differently.

What the Schufa stores – and what it does not

The Schufa records the existence of financial contracts and how you honour them. It stores data about bank accounts, loans, credit cards, and mobile phone contracts. Crucially, it does not store your salary, your employer, your nationality, your religion, or your address history. A landlord who receives your Schufa report sees a creditworthiness score and a list of any negative events (missed payments, debt collection proceedings) – not your income.

Once your current account is set up, the next step is putting spare money to work. Germany has a well-regulated savings market with two main products designed for private savers: Tagesgeld and Festgeld. Both are protected by German deposit guarantee schemes up to 100,000 EUR per bank and customer.

Investing: ETF savings plans (Sparplan)

Germany has a growing culture of retail investing through ETF savings plans, and Trade Republic has become the dominant provider for straightforward, low-cost monthly investing. For as little as 1 EUR per month, you can set up automatic purchases of a global index ETF.

Day-to-day banking in Germany follows patterns that may differ from what you are used to. Cash still plays a larger role here than in most comparable countries – many smaller restaurants, markets, and local shops do not accept card payments at all. At the same time, contactless payments via NFC, Apple Pay, and Google Pay are widely accepted in supermarkets and chain retailers.

Transfers and payments

Bank transfers within Germany and the eurozone use the SEPA system. Most transfers arrive the same working day or the next day. There are no fees for SEPA transfers between German accounts. Sending money internationally (outside the eurozone) can incur fees; Wise or Revolut are typically cheaper than traditional banks for those transactions.

Cash withdrawals

With most free accounts, you can withdraw cash for free at the bank's own ATMs or partner networks. N26 allows a limited number of free withdrawals per month at any Mastercard ATM. C24 Bank has an extensive free ATM network. Always check whether the ATM is within your bank's free network before withdrawing.

Some banking situations require specific knowledge depending on your status in Germany. International students, freelancers and the self-employed, and people who have just arrived with a residence permit or Blue Card each face slightly different requirements and have access to different products.