For bank customers, it is annoying if the account slips into the downside. Finally, then incurred costs for the credit line. But the good news for consumers is: Overdrafts are cheaper. But the old problem remains: financial institutions do not pass on falling interest rates to customers to the same extent as rising interest rates.

Banks reduce disbursement interest

Banks reduce disbursement interest

In the past, banks have adjusted their own discretionary rates little or not at all to the otherwise low interest rates. This has changed at least partially at the beginning of this year. While banks at the beginning of 2016 charged their customers an average of 10.60 percent, the average interest rate in the middle of the year was 9.48 percent. The “customer-friendly” financial institutions include, for example, the Alibank, which has lowered the interest rate from 7.50 to 6.90 percent. The same applies to the Bankate, which currently requires only 7.49 percent for the overdraft. Obviously, the market is putting banks under pressure. At the beginning of July, numerous small and regional banks and savings banks began to adjust interest rates.

Unclear regulations for interest rate changes

Unclear regulations for interest rate changes

Consumer advocates criticize that numerous banks and savings banks disadvantage their customers in the calculation of costs, if the current account is overdrawn. Also, many financial institutions do not explain transparently when and under which conditions the interest rate will be adjusted. This explains Carmen Friedrich, head of the responsible team of the “market guardian of finances” in the consumer center Saxony. This is a nationwide network maintained by Consumer Centers. Already in November, Friedrich and her team had presented a study on advertising for more than 1,300 checking accounts at 371 savings banks and banks. Here, the consumer advocates have established reliable and clear rules on the interest rate for the credit line only at a total of 32 financial institutions. However, well-bundled and easy-to-find information, especially in view of the numerous offers on the Internet all the more important.

Banks violate their own interest rules

But also in the 32 financial institutions with transparent regulations is not always acted in the interests of the customers in the opinion of the consumer advocates. Carmen Friedrich says: “Eight of the banks violate their own interest adjustment rules, by not applying them.” Instead, the financial institutions would sit idly the topic of interest rate adjustment. Overall, however, the overdrawing of the account has become more favorable in recent years given the general low interest rates. As the financial advisor FMH has determined from Frankfurt, is required by German banks on average currently an interest rate of 9.48 percent for the overdraft. By contrast, about five years ago the average was still 11.39 percent.

Tip : the amount of a bank’s dispo can be found in the price list in the entrance area of ​​the branch as well as on the website of the respective bank.

Falling interest rates do not arrive at the consumer

Falling interest rates do not arrive at the consumer

Consumer advocates have been criticizing for years that financial institutions do not pass on falling interest rates to customers to the same extent as rising interest rates. Carmen Friedrich says: “Credit institutions do not adjust the borrowing rate for months or even years. The overdraft interest rate is thus decoupled from the market development, creating a parallel world of interest rates. “And further:” We write to and call attention to the credit institutions concerned. Under certain circumstances, further legal action will follow, depending on how the bank positions itself in the future. “

Stronger controls announced

Because the banks are only reacting with delay to the interest rate policy of the European Central Bank, Elisabeth Roegele – executive director at the Federal Financial Supervisory Authority – announced in May that she wanted to increase the control of financial institutions with regard to their interest rate policy. The reason: many borrowers complained to the regulator about loan overdraft rates being still too high, according to a report from Wirtschaftswoche. Initially, direct banks, state promotional banks and automobile banks were scrutinized.

Arbitrarines instead of transparency

Arbitrarines instead of transparency

In the online offer of four of the 32 banks, however, customers are searching in vain for information about the adjustment rules, as most of the banks surveyed in 2015 do not disclose all information relevant to the consumer. For some banks even arbitrariness in the design of the interest rate can be seen. A financial institution was therefore even warned because it raises or lowers the interest rate “at its discretion,” which represents a violation of the transparency requirement under Article 307 BGB for the consumer advocates. For this reason, they are once again calling for uniform statutory provisions in order to make the conditions of the banks more transparent for the system. They demand that a monthly adjustment of interest rates according to binding rules for all banks is required by law.

Bankenbrand defends interest rate policy

Bankenverband defends interest rate policy

The umbrella organization of the banking associations, the Alibank, explains: “Banks and savings banks must at all times keep ready the amount of money that the customer may use as part of their disposition credit. And this service costs. In addition, this loan is finally intended only for a short-term and flexible use.

This is how consumers can fight back

This is how consumers can fight back

Negotiating with the bank over the interest rate is futile. Because the interest for the Dispo are the same for all customers. If the costs are too high, however, there are several ways to escape the interest trap. In some cases it is worth changing the bank details or using alternatives. Those who are already deep in the chalk at their bank should replace their old loan prematurely on more favorable terms.

Editorial tips

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What is a dispo?

What is a dispo?

The credit line is a way for individuals to overdraw the account. As a result, the account holder has the opportunity to make disposals of the current account even if no corresponding credit is available.

This is possible if a checking account is kept as a current account in accordance with Section 355 of the Commercial Code. Simply put, the account balance can be in both the plus and the minus ( see also current account credit ).

Regulated are the possibilities for overdraft in Section 504 of the Civil Code. Among other things, it stipulates that the account holder may not be charged any further costs apart from the regular interest. Also, the account may only be charged once per quarter with the interest payment. In addition, the credit institution must inform the account holder of the credit limit, the current annual interest rate and the conditions under which the interest rate can be changed.