German bank accounts
This is a brief guide to German banking. We discuss the most important aspects of banking Germany (accounts types, money transfers, payment methods) and what accounts we recommend. Generally, accounts should be free and give easy access to payments and ATMs.
You will need a bank account to receive your salary, to pay for your rent and to make purchases with debit or credit cards. While many Germans still like to keep cash and there exist quite a few smaller shops that still only accept cash, the adoption of cashless payment options accelerated notably over the past few years. In particular, credit cards are much more widely accepted than they used to be. In summary, having bank account is imperative and in most situations it is best to open an account with German institution, even if you already have another bank account in another country (even if it is in the eurozone).
Girocard: the original German debit card
Historically, most German bank accounts came with a so-called Euro-Cheque card (EC card, sometimes also called electronic cash). This card could be used to withdraw cash at ATMs, but also to make purchases in stores. These cards were equipped with an electronic chip long before Visa and Mastercard adopted chip secured cards. Payments were either implemented as Chip+PIN transactions, where the money would be almost immediately withdrawn from the account, or as direct debit (Lastschrift), which often would take a few days before the money would be withdrawn.
Visa and Mastercard: the new standard
Starting with a number of online only banks and newer fintech companies, visa and mastercard became the new standard. While most traditional banks still charge an additional fee if a customer requires a visa or mastercard, almost all online banks provide one of these cards for free (sometimes even as the only card, so that there is no girocard anymore).
Currently, most German banks offer contactless payment options. This can either be done through a contactless card (Girocard or Visa/Mastercard) or through some smartphone app. In particular, many German banks support Apple Pay and/or Google Pay. In most situations, amounts up to 50 EUR can be paid contactless without the requirement of entering a PIN.
Withdrawing and depositing cash
While it becomes increasingly common that you can pay by card in Germany, there are still many merchants that require payments in cash. For this, it is important that you can easily withdraw cash in Germany, but this would also be good if you travelled abroad. Many banks run their own network of ATMs or are part of a larger network together with other banks. Most notably, the German Sparkassen have a close-knit network that even covers some rural regions.
IBAN: account and routing number
Germany is part of the Single Euro Payments Area (SEPA), so most bank transfers are based on the International Bank Account Number (IBAN). This number serves as a unique identifier of a given account and includes the information for both, account and routing number for most purposes. Only if you need to transfer money from outside the eurozone (or as a double check), you will also need to provide the Identification Code (BIC).
Best German bank accounts
This is a non-exhaustive list of the best German bank accounts (also including some EUR accounts that are technically not based in Germany, but available to German residents):
DKB - Deutsche Kreditkbank* (15 EUR bonus). This is likely the best bank account available to German residents. There are no monthly fees and it includes a German Girocard and a Visa card with free ATM withdrawals (ATM fees are not reimbursed, but almost no German ATM has such fees when using Visa). While the account is always free, some additional perks ("Aktivkunde") are unlocked if you have a monthly deposit of at least 700 EUR. This deposit could even come from another EUR account, which you use to transfer money back and forth. Unfortunately, DKB does not have an English user interface, as of writing.
N26*. This is a modern app-only account based in Germany, but also available to residents of other European countries. It has an English interface and provides a Mastercard.
Revolut*. Technically, this is not a German bank account, but it includes free EUR and GBP accounts, which are connected to the local payment networks. This account You can read more about Revolut as multi-currency account.
Wise*. Again, this is not really a German bank account, but rather multi-currency account, which includes local bank accounts in multiple currencies. You can read more about Revolut as multi-currency account (note that there is a small fee for sending money, but not for receiving).