Why Deposit Rates Differ Across EU Countries

Key facts

• One policy rate, many outcomes: the ECB deposit facility rate has stood at 2.25% since 17 June 2026 — yet top fixed-deposit rates across the EU range from 1.48% to 2.33%.
• Spain and Germany lead at 2.33%; Luxembourg trails at 1.48% — a roughly 1.6× gap between the best and worst national markets.
• 14 of 23 countries tracked by PickTheBank offer a maximum rate of 2.30% or higher.
• 8 countries have a top rate below the ECB's own 2.25% deposit facility rate.
• ECB research finds banks in concentrated markets keep deposit rates about 40 basis points lower for roughly six months after a 100 bp policy hike.
• On a €50,000 deposit, the Luxembourg–Spain gap is worth about €425 per year — with identical €100,000 deposit protection on both sides.

The euro area has a single central bank, a single policy rate and a single rulebook for deposit protection. In theory, a euro saved in Luxembourg should earn roughly what a euro saved in Madrid earns. In practice, it doesn't — and the gap is wide enough to matter.

As of July 2026, the best fixed-deposit rate a saver can find ranges from 2.33% in Spain and Germany down to 1.48% in Luxembourg, according to PickTheBank's country statistics, which track more than 1,000 banks across 25 European countries (23 appear in the current rate table). That 0.85-percentage-point spread — a 1.6× difference — exists despite the fact that most of these banks refinance at the same ECB rates and insure deposits under the same EU directive.

This article explains where the gap comes from, what the research says about it, and why it amounts to free money for savers willing to look across their own border.

The data: one ECB rate, 23 different answers

The table below shows the maximum fixed-deposit rate available in each country tracked by PickTheBank, as of 21 July 2026. For reference, the ECB deposit facility rate — the rate banks earn on money parked at the central bank — has been 2.25% since 17 June 2026.

Rank	Country	Top fixed-deposit rate	vs ECB deposit facility (2.25%)
1	Spain	2.33%	+0.08 pp
1	Germany	2.33%	+0.08 pp
3	Bulgaria	2.30%	+0.05 pp
3	Slovakia	2.30%	+0.05 pp
3	Portugal	2.30%	+0.05 pp
3	Estonia	2.30%	+0.05 pp
3	Finland	2.30%	+0.05 pp
3	France	2.30%	+0.05 pp
3	Netherlands	2.30%	+0.05 pp
3	Malta	2.30%	+0.05 pp
3	Italy	2.30%	+0.05 pp
3	Lithuania	2.30%	+0.05 pp
3	Latvia	2.30%	+0.05 pp
3	Belgium	2.30%	+0.05 pp
15	Ireland	2.25%	0.00 pp
16	Croatia	2.20%	−0.05 pp
17	Austria	2.15%	−0.10 pp
17	Romania	2.15%	−0.10 pp
19	Slovenia	2.10%	−0.15 pp
20	Greece	1.80%	−0.45 pp
21	Czech Republic	1.60%	−0.65 pp
22	Cyprus	1.50%	−0.75 pp
23	Luxembourg	1.48%	−0.77 pp

Source: PickTheBank statistics, 21 July 2026. Czechia and Romania are EU members outside the euro area, adding a local-currency policy dimension on top of the factors discussed below.

Two patterns stand out. First, the top of the table is crowded: 14 countries cluster at 2.30% or above, slightly above the ECB's deposit facility rate — a sign that in competitive markets, banks bid actively for retail funding. Second, the bottom tail is long: in eight countries the best available rate sits below what the ECB itself pays banks on reserves. A saver in Luxembourg or Cyprus is being offered less for their money than their bank can earn risk-free overnight.

Driver 1: Banks only pay for money they need

A deposit rate is a price, and the price of funding depends on demand for it. Banks with strong loan growth — mortgages, corporate credit, consumer lending — need to attract deposits to fund it, and they pay up. Banks with weak loan demand, or with business models that don't rely on retail deposits at all, don't.

This is the cleanest explanation for the extremes of the table. Spain and Germany host large, loan-hungry retail banking markets where domestic and foreign-licensed banks compete hard for household savings. Luxembourg's banking sector, by contrast, is dominated by private banking, fund administration and wholesale business; the retail deposit market is small and few institutions bother competing in it. When no one is fighting for your deposit, no one prices it attractively.

Driver 2: Concentration — fewer banks, lower rates

Market structure matters, and this is where the evidence is strongest. An ECB working paper by Stephen Kho (Deposit market concentration and monetary transmission: evidence from the euro area, ECB Working Paper No. 2896, 2024) examined how banks across the euro area passed the 2022–2023 rate hikes through to depositors. The finding: banks in more concentrated national markets raise deposit rates more slowly when policy tightens — keeping rates roughly 40 basis points lower for about six months after a 100-basis-point hike compared with banks in less concentrated markets — and cut them faster when policy eases.

In other words, where a handful of banks dominate, they can afford to underpay depositors in both directions of the rate cycle. The paper concludes that this heterogeneity in concentration "could contribute to heterogeneity in the transmission of monetary policy to deposit rates" — a precise academic description of the table above. Small, concentrated markets such as Cyprus, Luxembourg and Greece sit at the bottom; larger markets with many active competitors sit at the top.

Driver 3: Excess liquidity — banks are still flush

A decade of quantitative easing left euro-area banks holding large excess reserves. A bank sitting on abundant liquidity has little reason to bid for more deposits, whatever the policy rate does. This effect is uneven across countries: banking systems that accumulated the most excess liquidity — often in core and wealthy economies — face the least funding pressure and show the weakest pass-through. It is no coincidence that some of the lowest top rates appear in countries whose banks are structurally awash in cash.

Driver 4: Depositor behaviour — rates follow attention

Banks price deposits against how likely customers are to leave. A second ECB working paper (Bank deposit pricing in the euro area, Albertazzi, Faber, Gavazza, Georgescu and Lecomte, ECB Working Paper No. 3255) estimates that euro-area banks pass only about 25% of policy-rate changes through to household sight deposits in the long run — versus roughly 40% in the United States — and that pass-through fell from about 0.3 in the 2007–08 hiking cycle to about 0.1 in 2022–24. The authors' explanation is telling: rate-sensitive customers progressively moved their money to better-paying alternatives, leaving behind an inert deposit base that banks can underpay with impunity. They estimate households would have earned 31–45 basis points more had this dynamic not played out.

The flip side is that where savers do shop around — helped by comparison platforms, cross-border deposit marketplaces and branchless online banks — banks must compete. Germany, with its long-established rate-comparison culture and deep online-banking penetration, tops the table despite being one of Europe's most liquidity-rich markets. National savings habits reinforce the pattern: in countries where households habitually leave money in current accounts at the local incumbent, banks face no pressure to pay; in countries where moving money for 20 extra basis points is normal behaviour, they do.

What this means for savers: the gap is free money

Here is the part that should interest anyone with savings: none of the drivers above have anything to do with risk to the depositor. The gap is a market-structure artefact, not a risk premium — and EU law has removed the reasons not to arbitrage it.

• Protection is identical. Under Directive 2014/49/EU, every EU member state guarantees deposits up to €100,000 per depositor per bank through a national deposit guarantee scheme, with a standard seven-working-day payout target. A euro in a Spanish bank at 2.33% carries the same statutory protection as a euro in a Luxembourg bank at 1.48%. Our guide to deposit guarantee schemes covers the details country by country.
• Transfers are trivial. SEPA makes a euro transfer to any of the 27 EU countries as cheap and fast as a domestic one. Opening a deposit with a bank in another member state increasingly requires nothing more than an online onboarding flow — see our step-by-step guide to opening a fixed deposit abroad.
• The money is real. On a €50,000 deposit, the 0.85-point gap between Luxembourg and Spain is worth about €425 a year before tax — roughly €1,275 over a three-year term. For savers in Cyprus, Greece or Czechia, simply matching the mid-table 2.30% on offer in a dozen countries delivers a comparable uplift.

The saver's conclusion is simple: your country's deposit market is an accident of banking structure, not a constraint. Use our deposit comparison tool to see what your money could earn across all 25 countries we track.

FAQ

Why do deposit rates differ if the ECB sets one interest rate for the whole euro area? The ECB rate sets banks' funding conditions, but each bank decides what to pay depositors based on its own funding needs, local competition and customer behaviour. ECB research shows banks in concentrated markets pass through roughly 40 basis points less of a rate hike for about six months, so national market structure creates persistent gaps even under a single policy rate.

Is a higher deposit rate in another EU country a sign of higher risk? Not in itself. All EU countries protect deposits up to €100,000 per depositor per bank under harmonized rules (Directive 2014/49/EU). The rate differences documented here are driven by competition and funding demand, not by differences in depositor protection. Within the €100,000 limit, statutory protection is the same across the EU.

Which EU countries currently offer the best fixed-deposit rates? As of July 2026, Spain and Germany lead at 2.33%, followed by twelve countries at 2.30%, including Bulgaria, Portugal, France, the Netherlands and Italy. The lowest maximum rates are in Luxembourg (1.48%), Cyprus (1.50%) and Czechia (1.60%). Live figures are on PickTheBank's statistics page.

How much extra can I actually earn by moving my deposit abroad? The current gap between the lowest and highest national maximum is 0.85 percentage points — about €425 per year on a €50,000 deposit, or roughly €1,275 over a three-year term, before tax. Interest earned abroad is typically taxable in your country of residence, so check local rules.

Why are some top rates below the ECB's 2.25% deposit facility rate? In eight countries the best available rate is below what banks themselves earn parking money at the ECB overnight. This happens where banks hold abundant excess liquidity and face little competitive pressure: they simply don't need household deposits enough to pay full price for them.

Sources

• PickTheBank — Maximum interest rates in different countries (data as of 21 July 2026)
• ECB — Key ECB interest rates (deposit facility rate 2.25%, effective 17 June 2026)
• Kho, S. (2024), Deposit market concentration and monetary transmission: evidence from the euro area, ECB Working Paper No. 2896
• SUERF Policy Brief summary of Kho (2024): Deposit market concentration and monetary transmission
• Albertazzi, U., Faber, F., Gavazza, A., Georgescu, O.-M. and Lecomte, E., Bank deposit pricing in the euro area, ECB Working Paper No. 3255
• Directive 2014/49/EU on deposit guarantee schemes (€100,000 harmonized coverage)