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Sparkasse banks start charging own customers for withdrawals

For many foreigners new to Germany, it’s annoying enough to be charged for withdrawing cash at any ATM. But paying to take money out at your own bank seems a step too far.

Published: 31 March 2017 09:55 CEST

Sparkasse banks start charging own customers for withdrawals

Photo: DPA

If you have an account with say Deutsche Bank in Germany and decide to take out money at a Sparkasse ATM, you can end up paying close to €5 for the service.

Given the distinct lack of ATMs on German streets and the necessity of paying with cash in many shops and restaurants, this state of affairs can lead to more than the occasional frustration.

So customers of Sparkasse banks are unlikely to be pleased to hear that many branches are charging fees of up to €0.50 to their own customers when they withdraw cash.

The finance website biallo.de reports that Sparkasse banks across Germany have started charging these fees. But because Sparkasse is a network of around 400 partly public companies, the fees vary from region to region.

The website came to the conclusion that, of the 400 companies in the Sparkasse network nationwide, over 40 of them are now charging withdrawal fees.

In Erding, a town just north of Munich, customers with “classic” current accounts can now withdraw cash twice in the month from a clerk for free, before paying a €0.29 fee. Those who withdraw at an ATM can withdraw money four times per month before they start being charged.

But that fee is relatively benign compared to other Sparkasse banks, which make customers pay for every withdrawal.

Twenty Sparkasse companies now charge customers every time they take out money. Several Sparkasse banks, including those in Rottal-Inn, Bavaria, and Grebenstein in Hesse, have started charging €0.50 for every withdrawal.

Most frustratingly for Sparkasse customers, it does not even seem clear whether they are fully alerted to the charges.

The Erding Sparkasse failed to respond to a request from biallo.de to know whether customers were warned at the ATM that they were about to be charged.

READ ALSO: 7 things that really grind your gears when you first arrive in Germany

Card over cash? Why Germany is seeing a new payment preference

Germany has long been a very cash-based country, occasionally to the dismay of frustrated tourists at the Döner shop.

A few German phrases express the people’s love of physical money. There’s ‘only cash is true’ – Nur Bares ist Wahres. Or Bargeld lacht, literally meaning cash laughs, but used to imply that cash is what’s wanted, similar to ‘cash is king’ in English.

But the classic German preference for cash appears to be evolving, as the use of girocards is growing, even for small transactions.

How are girocards being used?

Girocard, an ATM and debit card service offered by German Banks, was designed to allow customers to use virtually all German ATMs and, increasingly, to make purchases at businesses.

READ ALSO: Ask an expert – Why is cash still so popular in Germany, and is it changing?

Last year, consumers in Germany used their Girocard more often than ever before for cashless payments. A total of €7.48 billion payment transactions with the plastic card were counted – 11.5 percent more than in the previous record year 2022, according to figures published by the Frankfurt-based institution Euro Card Systems.

Whether at the bakery, petrol station or supermarket, customers are increasingly pulling out their cards at the checkout, even for smaller amounts. As a result, the average amount paid with the Girocard fell from €42.34 to €40.69 within a year.

The rise of card payments in Germany

Contactless payment, which is possible with girocards and credit cards that have an NFC chip, got a boost during the Covid pandemic, as retailers promoted it for hygiene reasons.

But the use of card payments has continued to grow in Germany since then, boosted partly by the increasing use of girocards.

Promoting the use of girocards, some German banks have expanded their cards’ functions: Sparkassen, Volksbanken, or Raiffeisenbanken offer girocards for the digital wallet, for example.

Banks want to continue upgrading the payment card with further applications. For example, a project is being tested which would add an age verification function to girocards that would be useful when a customer is buying cigarettes.

On the retail side, it’s clear why the Girocard is preferred to other debit options.

“We see that debit cards from international providers cost up to four times more,” Ulrich Binnebößel, Head of the Payment Systems & Logistics Department at the German Retail Association (HDE) told DPA.

What’s the difference between the Girocard and other debit?

The Girocard is a strictly German phenomenon. It can be seen as the latest iteration of the EC card, which was created to consolidate payment systems following the unification of former East and West Germany.

In 1991 different debit card systems, including Eurocheque guarantee cards from former West Germany and Geldkarte ATMs from former East Germany, were unified into Eurocheque cards.

Then in 2001, the Eurocheque system was disbanded, but German banks continued to use the EC logo for “electronic cash’” cards, or EC cards. In 2007, the German Banking Industry Committee introduced Girocard as a common name for electronic cash and the German ATM network.

Girocards are only issued and accepted in Germany, so if you want to get one of your own, you’ll have to join a German bank, and shell out those notorious German banking fees.

READ ALSO: Why it’s almost impossible to find a free bank account in Germany

Alternatively, you can get by with internationally accepted debit cards provided by a bank in your home country, or otherwise by joining an app-based European banking service like N26.

But be warned, without the Girocard in hand, at some smaller retailers you may be told, “Leider nur Bargeld oder EC-Karte.”

With reporting by DPA

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