Since 19 June 2016, every consumer in Germany has had the right to a payment account with basic functions (basic payment account), irrespective of their credit status. This is set out in the new German Payment Accounts Act (Zahlungskontengesetz), which transposes the European Payment Accounts Directive into German law. Under the Payment Accounts Act, every consumer who legally resides in the European Union (EU) has a right to the basic payment account. This also includes persons with no fixed address, asylum seekers and persons whose deportation is subject to temporary suspension, i.e. who do not have a residence permit, but cannot be deported for legal or factual reasons. The aim of the basic payment account is to give all consumers the opportunity to participate fully in economic and social life.¹

Obligation on banks

The act obliges all institutions offering payment accounts for consumers to enter into basic payment account contracts (obligation to contract). Banks must offer a basic payment account to all eligible parties who apply for one within ten business days. Institutions must provide the consumer with an application form free of charge. This form, which is prescribed by law, can also be accessed on the institutions' and on BaFin's websites.

Only under certain conditions may banks terminate a consumer's basic payment account or refuse to open one to begin with. For example, they can refuse to open an account if the consumer already has a usable basic payment account with another credit institution in Germany. The bank can also refuse an application for such an account if the consumer has been convicted of a criminal offence against the bank, one of its employees or one of its customers in the three years prior to making the application. Grounds for rejection also include instances where the institution terminated a consumer's basic payment account because the consumer intentionally used it for illegal purposes. The same applies if provisions aimed at preventing money laundering and terrorist financing demand that an institution refuse to open the account.

In addition to the rules for the basic payment account, the Payment Accounts Act contains provisions intended to ensure greater transparency of the fees charged by banks as well as for greater competition, especially by making it easier to switch accounts. Since 18 September 2016, payment service providers have had to support consumers who wish to switch accounts.

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