Due to a mostly bad economy, owners of savings deposits in Europe get dismally low interest rates. SavingGlobal launched, six months ago, is platform to enable German savers to access to the best fixed deposit rates in Europe, from the comfort of their browsers. But now it’s raised €7.5m in a round led by Index Ventures, which will be used to first grow the core German market and then expand across Europe. This bring the total it has raised to €10 million.
According to a recent study by Postbank, German savers lose €14bn in purchasing power annually because bank deposit yields are currently stuck below the inflation rate.
In practice, this means that a German saver with €100,000 in a local bank would typically only earn €600 (e.g. 0.6%) interest over the course of a year. But by using SavingGlobal to find the best available rate, they could move their money to an account in a Bulgarian bank partner, for instance, and multiply their annual interest by a factor of more than 4x to as much as €2,500 (e.g. 2.5%).
Europeans are allowed to open savings accounts in any bank within the European Economic Area to access higher rates, but most don’t bother. But put that access on a Web platform and… boom.