The European Central Bank (ECB) has recently announced the first reduction in official interest rates since implementing the first increase in nearly a decade, bringing the deposit rate from 4% to 3.75%. This news is emerging as signs of a limit to savings remuneration for small savers in the country.
Emilio BotÃn initiated the battle for passive income back in 2010 to attract liquidity and clients from competitors. However, major entities are unlikely to engage in such tactics due to surplus liquidity and the burden of unproductive funds on their balance sheets.
The future outlook for interest rate cuts in Spain remains uncertain, though it could benefit mortgage holders. Anticipated cuts from the ECB may occur in September and December, with questions arising around whether neobanks offering rates of over 3% will lower their interest on savings accounts as rates fluctuate.
Digital banks continue to provide attractive interest rates, with short-term deposits becoming increasingly popular. Major players like WiZink and Deutsche Bank offer returns above 3%, appealing to savers with varying deposit timelines. While there have been some reductions in deposit interest rates among certain banks, the neobank sector is expected to remain competitive with offerings above 3%. Other entities like EBN, SelfBank, and MyInvestor are also offering attractive deposit rates for savers looking to invest short-term.