BaFin

Topic Consumer protection Basic payment account

Since the introduction of the German Payment Accounts Act (Zahlungskontengesetz – ZKG), all consumers legally residing in the European Union have been entitled to hold a basic payment account. This includes persons without a permanent place of residence and asylum seekers. Persons without a residence permit who cannot be deported due to legal or factual reasons (persons with a suspension of deportation) are also entitled to hold such an account.

1. What is a basic payment account?

A basic payment account is an account for payments that you can use like a current account but which is subject to certain protection provisions. For example, with basic payment accounts, the bank is not free to decide who it rejects as a customer or when it terminates the account (see points 7 and 13).

In order for these rules to apply, you must apply (only available in German) for a basic payment account or explicitly agree with the bank that you want to hold such an account.

2. Who is entitled to hold a basic payment account?

All consumers legally residing in the European Union are entitled to conclude a contract for a basic payment account. This is also the case for persons without a permanent place of residence and asylum seekers. Persons without a residence permit who cannot be deported due to legal or factual reasons (persons with a suspension of deportation) are also entitled to hold such an account.

Providing a postal address is sufficient for opening such an account. This means that reachability via relatives (family), friends or an advice centre is enough. A place of residence within the meaning of the German Federal Registration Act (Bundesmeldegesetz – BMG) is not required.

3. What does a basic payment account have to offer?

The basic payment account is a payment account with which you can deposit or withdraw money and carry out direct debits, transfers and payment card transactions.
However, the bank does not have to provide you with an overdraft. This means that you cannot go into debt by withdrawing or transferring more money than is deposited in your account.

Holders of basic payment accounts are – in comparison to those of other payment accounts, such as current accounts – subject to special protection: banks can only impose reasonable charges and their ability to terminate such accounts is substantially curtailed.

The basic payment account can, upon application, also be operated as a garnishment protection account (i.e. an account with a basic non-seizable balance). Further information on garnishment protection accounts can be found here (only available in German).

4. Where do I get a basic payment account?

In principle, all banks that provide payment accounts to consumers must also offer basic payment accounts. A payment account is any account with which money can be deposited and withdrawn and which allows for direct debiting, transfers and payment card transactions.

A bank may only reject an application for a basic payment account if there are legal grounds for doing so (see point 7).

5. How do I apply to the bank to open a basic payment account?

If you want to open a basic payment account, please use the relevant application form. You can also obtain the form from the bank at which you wish to open the basic payment account – either directly at the bank branch, by post or on the bank's website. It is not compulsory to use this form. However, it speeds up the assessment and prevents complications should evidence be required at a later date.

The bank must provide you with confirmation that it has received the application.

6. What documentation must I provide when opening the account?

The bank is legally obliged to verify the identity of the applicant. You therefore need an application form for opening an account (see point 5) and an identification document. This means that you must prove your identity when submitting an application. The documents you can use to do so are defined under the German Money Laundering Act (Geldwäschegesetz – GwG) and the Payment Account Identity Verification Regulation (Zahlungskonto-Identitätsprüfungsverordnung (only available in German)). The following documents fulfil the requirements

  • Valid official identity documents which require a photograph of the owner and which fulfil the identification requirement in Germany.
    This includes, for example, passports or identity documents that are recognised or accepted under German or foreign law or substitute documentation for such forms of identification.
  • Suspension of deportation certificate (Duldungsbescheinigung) pursuant to section 60a (4) of the German Residence Act (Aufenthaltsgesetz),
  • Arrival certificate pursuant to section 63a of the German Asylum Act (Asylgesetz).

Providing a postal address is sufficient for opening an account. This means that reachability via relatives (family), friends or an advice centre is enough. A place of residence within the meaning of the German Federal Registration Act (Bundesmeldegesetz – BMG) is not required.

7. Can my application to open a basic payment account be rejected?

The bank can only refuse to conclude a contract for a basic payment account under certain conditions. This is the case if:

  • you already have a payment account at another bank in Germany and you can actually use it,
  • you have been convicted of an intentional criminal offence against the bank, one of its employees or one of its customers in the three years prior to the application,
  • you have already held a basic payment account at the same bank and the bank terminated the account due to default in payment or due to the account being used for illegal purposes, or
  • by commencing and maintaining a business relationship with you, the bank would violate its general due diligence obligations under the GwG and the German Banking Act (Kreditwesengesetz – KWG) or would violate its confidentiality obligations when stating the reasons for the rejection.

8. What can I do if my application for a basic payment account is rejected?

If your application to open a basic payment account has been rejected, you have three possible courses of action:

  • you can apply to BaFin for administrative proceedings to be initiated,
    (the application form can be accessed here (only available in German), see point 9 for information on the process),
  • you can take legal action in the civil courts for a basic payment account to be opened, or
  • you can contact the competent consumer arbitration body
    (the competent arbitration body for your case can be found here (only available in German)).

9. How do BaFin's administrative proceedings work?

If the bank has rejected your application to open a basic payment account, you can apply to BaFin for administrative proceedings to be initiated. BaFin will provide confirmation of receipt in written form.

BaFin then assesses whether the requirements for concluding a contract for a basic payment account have been met. If the bank has wrongfully rejected your application to open a basic payment account, BaFin will issue an order for one to be opened. This means that the bank will then have to provide you with a basic payment account. You will receive written confirmation from BaFin about the completion of the proceedings.

If the requirements have not been met, BaFin will reject your application. You can then file an objection with BaFin so that the decision is reviewed once more. The institution can also file an objection against the order to conclude a contract for a basic payment account.

10. What costs might I incur from the administrative proceedings?

The administrative proceedings conducted by BaFin are free of charge. However, you must pay for any costs that you incur from written correspondence, e.g. postage costs. You will not be reimbursed for any legal costs or consultation fees.

11. Can I hire a lawyer for the administrative proceedings?

Yes. However, a lawyer is not required for such proceedings. You may, however, arrange to be represented by a third party (for instance, by a lawyer). Please note that you will be responsible for bearing the costs of legal representation yourself.

12. How can I contact BaFin?

Please use the form for administrative proceedings and send it to:

Bundesanstalt für Finanzdienstleistungsaufsicht
Referat ZR 3
Graurheindorfer Straße 108
53117 Bonn

You can also obtain general information on BaFin's consumer helpline. You can contact this helpline on weekdays from 8:00 am to 6:00 pm on 0800 2 100 500 (Callers from abroad: +49 (0)228 299 70 299).

You can also use the online form for complaints concerning basic payment accounts (only available in German).

13. Can the bank terminate a basic payment account?

The bank's ability to terminate basic payment accounts is curtailed by the ZKG. The grounds for terminating a contract for a basic payment account are listed in the ZKG. Banks may not terminate the account on any other grounds.

Provided it has been agreed, the bank may terminate the basic payment account (with a notice period of no less than two months) if:

  • the account holder has not used the basic payment account to make any payments in more than 24 months,
  • the account holder no longer fulfils the criteria for concluding a contract for a basic payment account,
  • the account holder has opened another payment account which falls within the scope of the ZKG and is able to use it, or
  • the account holder has rejected a declared change to the contract for the basic payment account (provided that it is a change within the meaning of section 675g of the German Civil Code Bürgerlichen Gesetzbuchs – BGB (link only available in German)) which the bank has offered with entry into effect to all holders of the relevant basic payment accounts that it manages.

The bank can also terminate the contract for the account without any agreement on such a right to termination with a notice period of no less than two months if the account holder:

  • has committed an intentional criminal offence against the bank or one of its employees or customers in relation to their being an employee or customer of the bank, or if the account holder seriously damaged the interests of the bank through any other intentional criminal actions and it can therefore no longer be reasonably expected that the bank continue the contractual relationship, or
  • the account holder has not paid the bank any charges or costs for more than three months. However, the amount owed must exceed 100 euros and there must be reason for concern that continuing to manage the account would result in further claims and that the payment of such claims could not be guaranteed.

Extraordinary termination of the basic payment account contract by the bank is possible without any notice period if the account holder:

  • intentionally uses the payment account for purposes that violate a legal prohibition, or
  • has provided incorrect details in order to be able to conclude the contract for the basic payment account and had the correct details been provided, no such contract with the account holder would have been possible.

14. Reasonable charges

Banks are allowed to stipulate reasonable charges for the management of basic payment accounts (§ 41 ZKG). When assessing the reasonableness of charges, particular consideration is to be given to the usual market charges and user behaviour.

updated on: 20.07.2017

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