6 out of 10 people would switch their account
… but few actually do it. “Less than 10 percent”, says Sascha Dewald, CEO of FinReach, “use a special account switching service, which also cooperates with the DKB”.
Never before in history, there were so many increases or reintroductions of account management fees as in the year 2016.
Switching accounts nowadays is more meaningful than in recent years, because it is a definition of route of banks – the president of the German Savings Banks Association, Georg Fahrenschon, is thus repeatedly quoted with his declaration, “The time of free accounts is over.”
Not only the savings bank, also other major German retail banks have already decided that the account management fee paid by the customer should contribute to cover costs – which were built during the years of abundance and cherished structures.
It is a new definition of route, because the best German direct banks, which we observe up close right here on our special portal, have chosen to not do that.
The current accounts of the DKB, Comdirect and ING-DiBa along their credit cards will remain absolutely free of charge also in the coming years!
Direct banks will remain free of charge!
1. Is there a trend towards free direct banks?
One might expect that many people open a new current account and cancel the old one as soon as possible. But what actually happens?
Part 1, it is actually increasingly implemented to open a new current account at one of the free direct banks. All three direct banks mentioned above have opened far more new current accounts in the first few months than in a long time.
Many, many new account openings at direct banks
The second part, which is the account move, is however completed only by few people in a short time.
If one asked Sascha Dewald, one learns that one of the main reasons that bank customers are afraid of, is the time and administrative effort. His company has found that an account switch in our increasingly complex world takes an average of 240 minutes! These are two movies, including commercial breaks.
Additionally, the concern is present and justified that you might forget to switch a few posts and that it then may lead to unpleasant consequences of uncashed debits with the known consequences, such as use blocking etc.
This challenge has also been detected by the policy and it acted to make the account switch easy for bank customers in future.
2. New law forces banks to offer an account switching service
From the 18th of September 2016, banks are required to offer an account switching service!
There is not much time left until this deadline and so you can imagine that there is merry hell in the industry in order to create an account switching service compliant to the payment accounts act (German: Zahlungskontengesetz,ZKG)!
Some banks have already developed this in advance and have been offering an account switching service since last year.
I looked at several of these processes and find the fully digital account switching, as offered by FinReach, the best.
If you are already a regular customer of the DKB, you can use it free of charge. If you are not yet a customer of the DKB, you can become a customer here: account opening and first steps.
2.1 Advantages of the account switching service
- You do not forget to notify any payment partner about the switch, because all money receivers and transmitters are automatically read and processed based on the account transactions of recent months and displayed in order.
- Payment partners are notified fully digital. That means that you do not need to print, sign and send any letter. Big and well-known payment partners (such as insurances) receive a note about the account switching electronically. FinReach takes care of the printing and sending of letters to smaller or less well-known payment partners.
- You do not only save the letter and postage fees with this account switching service, but the entire service is completely free for you as a customer! The costs are borne by the bank to which you have switched.
- You save tons of time and frustration with such a professional account switching services, because it runs automatically. FinReach has measured that people, who are particularly fast with the account switching, achieve to complete the whole account switching including the automated cancellation letter to the old bank in less than 10 minutes!
I recorded for you how such an account switching works. The video clip starts in the online banking system of the DKB:
b) subscribe to our YouTube channel
Do you like the switching procedure as seen in the video?
Are there any questions left or did some just emerge? Please use the comments box at the end of this page. Gladly also for additions with your own experiences or tips!
3. Step by step through the account switching
Also the ING-DiBa provides its customers with tips for account switching. In the blog article, it says (excerpt from its checklist):
“Choose a permanently cheap bank”
The ING-DiBa is, of course, cheap, but also the other direct banks observed by us, which are the Comdirect and DKB.
“Account switching has never been so easy”
The bank refers to its switching service. Of course, the Comdirect and DKB (see video) also offer a very supportive service.
“See and organize payment transactions”
Yes, this previously took a lot of time! The software program of the account switching service does this for you and the procedure is completed within a few seconds.
“Report the new bank account”
You previously had to write many letters. Put them in an envelope, seal and stamp. To the post office. This notification mail is automatically created by the switching service. For this purpose, it knows your personal information and may partially read your customer number etc. from the previous bank statements.
In some cases, you may provide additional information, if not everything has been recognized. The delivery, however, is automatically and completely for free (not even postage!).
“Change standing orders”
No switching service can currently do that. It can indeed read all data from the previous account, but it cannot create them in the new bank account. The switching service does not have access to this. Could this change in the future?
However, the creation of standing orders should be easy for you, because the account switching service reads all existing standing orders and presents them for you in an overview. Now you can work with “Copy” and “Paste”.
“Wait with the cancellation”
Also the ING-DiBa recommends this. The background is that payments and change notifications may overlap. Sometimes, the update at some payment partners takes a little longer. Reminders and other law enforcement consequences should be easily excluded.
FinReach recommends to let the old account run for another two months. If you let the cancellation letter be sent by the account switching system automatically, then two months are pre-set. This setting can be changed at will!
Finally, the ING-DiBa also points out that some of their new customers save about Euros 500 through the account switching in the next 5 years. Surely, not only the account management fees, but also the annual fees for the cards and possibly further favourable services are included.
Euros 500 saved – and you?
How much will it be for you and will you treat yourself with a trip for this amount, as proposed by the ING-DiBa?
Set up a savings account to which you transfer the monthly savings by standing order. With this, you can build assets – at virtually no cost.
4. Open-minded for a recommendation?
People, who know me and our portal for some time, know that our recommendation for a powerful and free current account is the DKB. If you already have an account there and want to get a second account, please take a look at our ranking.
In order for new DKB customers to have an easier time to discover the numerous great features of the bank and use them smart, we currently work on the creation of the first online manual to the bank!
Online manual is in its creation!
The first parts and videos are already ready. We constantly add new and further ones. Being our fan, you can follow the development process live and can use the new documentaries first. Go directly to the free registration here ►►► become a fan.
4.1 A small request to you
Please recommend this website, so that even more people hear about this positive development and can decide for themselves – having the knowledge of new possibilities – whether the time has come for a change of account.
The task of our special portal is to help people to open the right bank account and use it cleverly.
Would you support this?
Further often read articles:
- Increase of the account management fees?
- A summary of the 11 most important functions of DKB Visa card
- Gebuhrenfrei MasterCard Gold ► clever use or scam trap?
Hi and thank you for this article.
From what I´m seeing now, a lot of people are waiting to see what will happen after the summer since Visa changed their conditions. May be a lot of German banks will start charging Visa cards (like the cards of Ing-Diba, DKB etc…).
So basically, they don´t want to regret moving from their regular banks to direct banks that can be charged everytime they withdraw money.
I think the situation is a little bit tricky for direct banks now, wait and see…
Hi! Yes, I agree with your thoughts, thanks for your post here!
Particularly, we need to pay attention when the ATMs in Germany are being changed over. In order to impose that direct fee onto customers, you have to print out an invoice. German ATMs cannot do that so far … as long as that is the case, we will hardly have this additional fee.
I hope the switching function will also save us from having to go through the identification procedure once again. Do you know anything about this? I mean, if I’m already an account holder of a German Girokonto at the time when I start the switching procedure, it should go without saying that I’m a verified customer
One has to first open a new giro account and get legitimized there, before one can use the account switching service.
Granted, it is an interesting suggestion to take your bank-verified identity with you (so to speak) to the next bank. But that is not part of the bank’s regulations, and that will probably not change that quickly.
I thought that banks in the same country could share their records somehow. In Italy we can open an online current account just by making a bank transfer from another traditional (physical) bank account under your name. If the amount (even just a couple of euros) is transferred properly and both names match, that works as identification procedure. That would make things much easier even in Germany… Talking about my case, I’m going to close a Hypovereinsbank Girokonto but as I’m not in Germany this time and I’m not a German resident, I can’t find a way to open any other online accounts, as they all need me to be identified again, although I’ve had a German account for 4 years now.