Where can Irish People Open a Term Deposit with the Highest Interest Rate?

Economic Overview Ireland

Inflation in Ireland remained at a fairly high level throughout 2023, but started to fall towards the end of the year. This is due to price cuts announced by several domestic energy suppliers.

Significant base effects as well as lower commodity prices and supply constraints will also lead to further price reductions in food and non-energy industrial goods.

The current inflation rate in Ireland is

September 2023: 6.4%.
October 2023: 5.1%.
November 2023: 3.9%.

Ireland's inflation rate is forecast to be 2.7% in 2024 and 2.1% in 2025.

The ECB keeps its deposit rate at 4% by paying banks 4% on the money they deposit with the ECB. 
So, technically, we have entered a positive real interest rate environment at the end of 2023, where deposit rates are above inflation (4% vs 3.9%).

This is not very noticeable yet, but as inflation falls, the benefit will become more apparent and Irish people will not only be able to save money from inflation, but also make money.

In this article, we look at term deposits in EU banks that can be opened now and compare their yields with popular Irish banks. 

Term Deposits in the EU for Irish Residents

Irish people can open a fixed-term deposit in two ways: by opening a fixed-term deposit with a bank in Ireland, or by opening a fixed-term deposit online with a bank in another EU country.

The latter option is the most favourable as it gives access to the foreign exchange market and deposits with the best interest rates.

Irish citizens can find the best fixed deposit offers at banks in other EU countries.

This option is completely legal and safe: any deposit up to €100,000 per depositor and bank is covered by the Deposit Guarantee Scheme. Read our article for more information: Online Fixed Deposits in the EU: Safe, Convenient and Secure.

The choice of banks in the European Union is much greater than in Ireland. That's why we offer you an analysis of the best fixed deposits available to Irish citizens right now!
 

As you can see, the highest interest rates are dominated by short-term offers, which is great because short-term deposits allow you to keep your finger on the pulse, and in the event of unforeseen changes in the Irish economy, you'll be able to get your deposit back quicker. 
 

Benefits of Opening Fixed-Term Deposits Online for Irish People

Fight Inflation: With high inflation in Ireland, opening fixed-term deposits online in banks in other European Union countries is an effective way to preserve the purchasing power of your money.

High Interest Rates: Many EU banks offer significantly higher interest rates on fixed-term deposits than local banks, providing a more substantial return on investment.

Convenience and Security: Opening a deposit online ensures convenience and security. Irish citizens can carry out all operations without leaving their homes, reducing time and risk.

Wide Choice of Banks and Services: The choice of banks in the EU is more diverse, allowing customers to find more advantageous offers and to tailor their investment strategies to their needs.

Long-Term Prospects: In the context of economic instability in Ireland, term deposits in EU banks offer the opportunity to create a long-term financial plan adapted to changing conditions.
 

Term Deposits in Traditional Banks in Ireland

As an example, let us look at the term deposits offered by the 3 largest banks in Ireland. Namely Bank of Ireland, Allied Irish Banks (AIB) and Ulster Bank.

Bank of Ireland

This bank currently offers term deposits with maturities of 6, 12 and 24 months:
 

Allied Irish Banks (AIB)

Allied Irish Banks has current offers for the same deposit terms.
The calculation of Irish bank deposit yields includes AER% and Gross Return at Maturity %. However, for the sake of clarity, we will only compare Gross%.

Comparison of Returns on Term Deposits

Let's visually compare the offers from Ireland's largest banks with similar term deposits and similar deposit terms offered by banks in other EU countries that offer online term deposits to Irish citizens:

Let's say you invest €50,000.

 

As you can see, foreign banks offer much more favourable deposits than the popular banks in Ireland.
We are comparing 6 month deposits, however there is now a more profitable term deposit available to Irish people with an interest rate of 4.00% for a 3 month term, which will give a return of €2,000 for a similar deposit amount.

Bottom Line

In light of this analysis, it's clear that term deposits in EU banks offer significantly better returns than those in Ireland's popular banks. If your goal is to truly protect your savings from inflation, we strongly recommend that you consider the option of opening a term deposit online.

With Ireland's persistently high inflation rates and fluctuating economic conditions, investing in term deposits with EU banks not only ensures a higher return, but also offers greater financial security.

At PickTheBank you will find the best and latest term deposit deals from over 1000 banks across the European Union. Our platform is designed to help you easily navigate through different banking options, allowing you to compare and choose the most advantageous term deposits that match your financial goals.

By choosing term deposits with EU banks, you can benefit from higher interest rates, ensuring that your money not only retains its value but also grows in these uncertain economic times.