(Finance) – With the European Central Bank which in its October meeting decided to raise interest rates by 75 basis points, thus significantly increasing the cost of money for the third consecutive time and making considerable progress inabandonment of the accommodative stance of monetary policywe witnessed a flourishing of commercial offers dedicated to deposit accounts by the Italian banks. Some institutions quickly adapted to the new scenario and started advertising their offers on deposit accounts again, with attractive rates. At a time when runaway inflation erodes savings, many may find it convenient to use liquidity in these instrumentseven if none of them come close to covering what is lost at current inflation rates.
The deposit account can have several characteristics. That bound provides that the liquidity deposited in the account is “frozen” for a certain period of time. Against the bond agreed with the customer, the bank guarantees a remuneration at the interest rate set out in the contract. The deposit account freeon the other hand, it does not provide for the obligation to keep the sums in stock, therefore the saver can withdraw the sums deposited at any time without incurring penalties. Hybrid models they allow the release of the sums deposited against a decrease in remuneration.
The interest rate of the deposit account represents the guaranteed return on the capital invested by the customer, i.e. on the sum deposited and restricted. Interest on the sums deposited is usually disclosed in the form of gross interest ratewhose effective yield is reduced due to the taxation, currently set at 26%. A deposit is also applied to the deposit account stamp duty to the account equal to 0.2% of the money in the account at the end of the period to which the statement refers.
Performance isn’t the only thing customers are looking at, though. “The main objective of a winning bid must be the ability to guarantee a complete service – he explains to Finance Javier LipuzcoaHead of Digital Banking Italy of BBVA – In addition to the specific performance, we believe that the flexibility of the cancellation conditions and the level of constraint required are fundamental decision points“. BBVA has recently (on the occasion of the anniversary of its landing in Italy) launched its first Flexible Deposit at 2% for 12 months. The deposit is available for a minimum amount of 500 euros and up to a maximum of 50,000 euro and will be paid at the end of the contract. In case of early release of the sums before the end of the twelve months, there are no cancellation costs: customers will be remunerated with the 1% applicable to the time period in which the deposit was active .
Furthermore, banks that offer potential customers a deposit account need to be transparent, given the high competition. “Deposit accounts are a very competitive market. The products are advertised transparentlythe comparability of economic conditions occurs with simplicity and the market is polarized on the best offers – he tells Finance Iacopo Di Francisco, CEO of Banca CF + – Customers are attracted above all by remuneration, in fact, the banks that are able to maximize funding are those that offer the most attractive rates. Among the other relevant characteristics, there are: the flexibility of the offer, with the total or partial release of the sums before the deadline; the digitization of account opening and management processes; there investment securitywith the solidity of the institution and the adhesion to the Interbank Deposit Protection Fund, which are very important aspects “.
Banca CF +, an institution specializing in financing solutions for companies in performing or re-performing situations, has launched the new online escrow account intended for Italian private savers. It can be opened and managed entirely online, it is not subject to the opening of a current account, it does not involve opening costs, it offers maturities from 12 to 60 months – with the possibility of choosing between a releasable and a non-releasable line – and gross returns up to 4%.
Between other products on the market there are those of Cherry Bank, Banca Progetto, Bank SystemBanca AideXa, Banca IfisTwist (Banca Valsabbina), ViViBanca, IBL Banca e illimity Bank, ING. Many of these institutes are so-called challenger bankthat is, small and recently born banks, which aim to compete directly – or challenge – traditional banks using innovative technological tools and processes.
According to Di Francisco, “a challenger bank is able to intervene very quickly on its commercial offer and on the rates proposed, in particular, in the absence of overlaps with other existing accounts or with other offers. On the other hand, if a commercial bank were to launch a deposit account with high rates reserved for its online customers, it would create a misalignment with respect to the offers that can be activated in the branches, which respond to other dynamics and therefore offer less attractive rates “.
However, it is not necessarily easier for challenger banks to be commercially responsive to interest rate movements, according to Lipuzcoa, who explains how “deposits are, for example, a product well known to historical banks, but the launch of this product on the market is a matter of strategic decision. In fact, some competing banks do not have a proprietary deposit offering today. ”
A question that many people ask is what can happen to current accounts in the coming months, or if the banks will begin to offer a return on these instruments as well with the increase in rates. The answer is partly influenced by what will be the actions of the European Central Bank. The ECB raised interest rates by 75 basis points at its October meeting, taking another big step towards neutrality, having already raised the cost of borrowing by 75 basis points at the September meeting. Frankfurt noted that “substantial progress has been made in the withdrawal of monetary policy accommodation,” suggesting that this may have been the last 75 basis point increase and that future tightening will be more gradual as policy becomes less and less. accommodating. Most analysts expect the European Central Bank will carry out an interest rate hike of 50 basis points in December and will stop raising rates early next yearwhich in any case will remain at the level reached for a certain period of time.
“Each financial institution must obviously examine the situation and adapt its commercial offer – says the manager of BBVA – We carefully analyze the evolution of markets, rates and competitive dynamics, as well as closely follow the needs of our customers to offer them customized solutions and guarantee the best level of offer on the market “.
According to the CEO of Banca CF +, on the other hand, “the large commercial banks, in light of the strong growth in offerings of deposit accounts by the challenger banks, will inevitably choose to intervene on current account rates. However, the current account has for some time now been conceived as a service that does not provide for remunerationprovided by the bank to meet needs such as the management of payments, the crediting of salaries or the domiciliation of utilities “.
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