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Orange Bank Doubles Remuneration On Depósitos To 40000 Euros

BySam Brad

Sep 15, 2021

Orange Bank has entered the commercial battle of deposits by remunerating up to 40,000 euros, double that to date, despite cutting the deposit remuneration in half. Low interest rates have forced the financial institution of the telecommunications operator to review its conditions, but always marking distances with traditional banks.

Given the current financial environment, the largest in the sector do not ‘reward’ their clients’ savings and even penalize them with commissions. Faced with this reality, Orange Bank’s offer maintains one of the highest returns in the sector, although the proposal is not open to the general public but only limited to subscribers of the telecommunications operator.

As Orange Bank admits, through an email sent yesterday to its 125,000 clients, it is a “jug of cold water” to go from paying their savings accounts from 1% APR to 0.5%. In this way, the entity points out that “growing means, sometimes, giving up things that we like”, in reference to the new conditions. In any case, what will not change in Orange Bank two years after its creation in Spain “is that the settlements will continue to be monthly, and that they will be able to” enjoy the rest of the products and services of the Orange Bank account as always ” , points the entity.

The same bank also highlights that, from now on, its clients will be able to enter their payroll at Orange Bank, although the account will not yet be able to be used to direct benefits and pensions from public organizations. “It is being worked on,” they explain.

Traditional entities have lost the battle in recent years in the war to remunerate balances, in the face of negative interest rates that make the business unprofitable and the high costs they have to assume to maintain their structure. The most recent example is that of Banco Santander, which almost a year ago announced that it was eliminating what until now had been its star account, ‘1,2,3’.

This product came to earn a bonus at the time up to 3% of a maximum of 15,000 euros, although the bank gradually reduced this advantage until it eliminated the remuneration in 2019. In addition, traditional banks have also removed traditional deposits from their windows, before the lack of a bonus in the offer, in an environment in which interest rates are neither seen nor expected in Europe before 2023.

Bankinter is one of the few non-digital entities that maintain the remuneration of balances, up to 5% APR the first year with a limit of 5,000 euros and 2% APR, the second. This offer, along with being one of the entities that charges the least commissions to customers for the maintenance of accounts and cards, has allowed the group to gain customers year after year.

Advantage of online banking

With this situation, online banking, with a lighter structure, is the only one that can be allowed to offer customers a remuneration of the balances, also claim to gain users. However, the low interest rate environment has also taken a toll on supply, with the reduction of the bonus. Renault Bank, which landed in our country a year ago, now offers 0.5% APR, one of the highest returns on the market, taking into account that it does not limit the balance to be paid or the years. Nationale-Nederlanden offers 0.2%, also without a balance limit.

Bankinter’s online bank, Evo Banco, offers a term account remunerated at 0.01% APR up to 30,000 euros. Santander’s Openbank, for its part, rewards up to 2.58% APR in the Savings Account for new clients, and 0.05% APR, for existing clients. In the case of MyInvestor, belonging to the AndBank group, it offers a return of 1% APR up to 15,000 euros the first year (that is, it pays up to 150 euros a year just for having money in the account) and 0.1%, the later exercises.

Sam Brad

The Great Writer and The Passionate Poet As Well, He Graduated from University Of Florida in Journalism and Brad have around 12 years of experience in news and media section.

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