Most banks in Denmark give zero interest for savings

19:20, February 25, 2010      

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If you want to save some money in banks in Denmark, be aware that most banks give almost no interest at all for savings if your saving amount is lower than 100 thousand Danish Kronor. Even if the amount is 100 thousand kronor, the interest is only 0.25 percent, according to a report reaching here from Copenhagen.

“This has been the situation for a long time now because interest rates are so low. We have no problems in announcing that there is a zero percent interest rate (on deposits),” Kobenhavns Andelskasse CEO Rene Poulsen was quoted as saying.

The Andelskassen does, however, offer interest if you have several cooperative shares or more than DKK 100,000 on deposit. With 10 cooperative shares and more than DKK 260,000 in your account, Andelskassen gives 2.65 percent interest, reported Politiken.

“You have to remember that if you have over DKK 100,000 deposited, you get 0.25 percent, and we do have other offers where you can get different returns depending on which account you choose,” argued Lån & Spar Bank’s CEO John Christiansen.

He added that you can get five percent on your salary payment account – provided, for example, that you are an engineer or member of FDM.

“Some people ask us about it. We do have some savings accounts with interest, but they are not as functional as a salary payment account as you tie funds for several years,” he said.

“It can’t be correct marketing to call an account with a zero percent interest rate a High Interest Account,” said Consumer Council Chief Economist Carsten Holdum, but he warned people against just taking all of their money out of banks and putting it into mattresses.

“I would seriously advise people against doing that. You’ve seen examples of money burning up or disappearing. You should keep a reserve in a bank account so you have a buffer and consider placing money in, for example, safe bonds where you get a reasonable return,” Holdum said.

By Xuefei Chen, People’s Daily Online reporter in Stockholm
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