ING the second Netherlands bank to turn to negative savings interest
Banking institution ING has become the second bank in the Netherlands to charge a negative interest rate on certain savings accounts. Customers will face a -0.50 percent interest rate for any amount in an account above one million euros, the bank said on Friday.
The policy will affect about 6,400 current clients. The negative rate is charged per account, and not per customer.
Earlier this month, ABN Amro said it would implement the same rate on accounts above 2.5 million euros. That decision was expected to hit about 5,200 account holders
ING was lambasted for even suggesting the possibility of negative interest rates back in August. Customers criticized the CEO’s salary, and noted the bank had created significant savings already by shutting down many of its physical branch locations.
There will be no negative interest rate levied on roughly 99.9 percent of customers, the bank claimed. Most personal savings accounts at or below the 100 thousand euro mark will maintain the 0.01 percent interest rate. No positive or negative interest will accrue for personal accounts between 100 thousand and a million euros.
There will also be no interest earned by business account holders with a balance below a million.
ING said it would first implement the changes with business and private banking clients on April 1. Personal retail clients will see the changes begin on July 1. The bank plans to make direct contact with its customers in March.
The current Dutch cabinet said it had no plans to attempt to ban banks from charging negative interest rates on savings accounts.