Saving abroad within the EU: how deposit marketplaces work and what changes

Why rates differ across the EU

The ECB sets one policy rate for the euro area, but savings rates are set by banks, and banks differ in how badly they need deposits. A large bank with a loyal customer base pays little; a smaller bank in a smaller market that funds its lending from deposits pays more. Add differences in competition and in how much national regulators let banks lean on cheap deposits, and the gap between the best rate in one country and another is routinely a percentage point or more. Nothing stops a resident of one member state from taking a deposit in another; the banking licence is valid across the EU.

How deposit marketplaces work

Opening accounts directly at foreign banks means a new identification process, a new language and a new website each time. Deposit marketplaces, of which Raisin is the largest, remove that friction. You open one account with the platform's servicing bank, identify yourself once, and then choose deposits from partner banks across the EU. The platform moves your money to the partner bank and back; your contract is with that bank, not with the platform. Each partner bank is a separate institution with its own €100,000 guarantee, so a marketplace is a convenient way to hold several guaranteed deposits without several onboardings.

Which guarantee applies

The scheme of the bank's home country, at €100,000 per depositor, whatever your country of residence. If the bank fails, that scheme repays you within seven working days; for depositors abroad it usually pays through the scheme of your own country acting as its agent, in euros, to an account you nominate. Read the name of the bank's legal entity and its home country: a familiar brand may be a branch, covered by the parent's scheme, or a subsidiary with its own. And consider the scheme itself: all EU schemes meet the same rules, but they are national funds backed by national governments, and a rate far above every other bank's is sometimes a sign of a bank that other funders have stopped lending to.

Tax at source and at home

Interest is taxed where you live, as capital income, whatever the bank's country. Some banks must also withhold tax at source under their own rules; Italy, for instance, withholds 26 percent. Under the tax treaty between the two countries you either credit that against your home tax or reclaim the excess from the foreign authority, which takes paperwork and months. Some marketplaces handle the reduced treaty rate for you if you file a residence certificate in advance; check before choosing a deposit, because a high rate minus unrecoverable withholding can be lower than a modest rate at home.

Do not expect to keep the interest quiet. Under the EU's automatic exchange of information, the bank reports your interest to its tax authority, which passes it to yours. Declare it as you would domestic interest.

Practical points

Stick to euro deposits unless you want currency risk; a higher rate in a non-euro member state is easily wiped out by the exchange rate. Use a marketplace for convenience but read which bank you are actually contracting with. Keep each bank under €100,000 including any deposits you already hold with it through another channel. Note the notice period and the process for getting the money back at maturity, which through a platform can take a few days. And keep records of the deposits and the tax withheld; you will need them at tax time.

“The single market lets your savings travel. The guarantee, the tax and the paperwork travel with them.”

Summary

Saving in another EU country is legal, simple through a marketplace, and protected by the same €100,000 rule. Compare rates after withholding tax, spread deposits across banks rather than across brands, and declare the interest at home.