Withdrawals, local currency exchange, card payments... Here are the main charges and how to avoid them.
Have you just arrived in the Grand Duchy? Or are you working here? Then you have probably asked yourself this question: which bank should you choose? Which bank should you open an account with? Or even: which banks should you avoid?
We help you answer all these questions in this a comprehensive guide for new residents and those who want to find the right bank in the Grand Duchy !
The first step in choosing your bank is to find out which banks are available on the market. In Luxembourg, the main banks for individuals are the following:
These banks offer current accounts (with bank cards), loans, personal loans, home loans, home savings plans, pension plans and investment products.
Also, if you have moved to Luxembourg for work, there is a good chance that your employer has passed on the an agreement with one or more banks. You can take advantage of discounts on their account and card offers (or even a preferential rate on your home loan).
Ask your human resources officers for more information. However, you should also make sure that you compare banks You could find a better offer!
Once you know the players in the market, it is time to analyse the different offers. There are several criteria to consider when deciding which bank is best for you.
They are also known as theaccount maintenance fees". This is a fee charged by the bank each month, which gives you the right to keep your current account open.
These fees vary between €0 (for free online 100% accounts) and almost €10 (for accounts with good limits and good Premier or Gold cards).
Here are the four types of bank accounts that can be distinguished among the offers of Luxembourg banks.
In Luxembourg, most of the bank cards offered are VISA. There is no real difference between VISA and Mastercard: both are accepted in the vast majority of countries.
Here are the different types of bank cards and the options available for each:
It is always best to choose the card that offers the most insurance and protection. However, this depends very much on your budget: Platinum cards can cost between €20 and €40 per month depending on the bank (excluding account fees). Make sure you choose a card that suits your shopping habits and your financial capacity.
This is a specificity of Luxembourg banks: most charge fees that are not found in other border countries (such as France, Belgium or Germany).
If you are used to travelling or making transfers to other accounts (e.g. family accounts), consider choosing a bank that offers a good number of free external withdrawals and transfers.
There are two types of overdraft fees in Luxembourg. On the one hand, there are the commissions, and on the other, the overdraft interest.
If you are often overdrawn, we advise you to choose a bank that does not offer no overdraft commission.
You should also be sure to choose the bank that offers the lowest interest rates on the market. You can find these banks in this comparison.
Even if you are only looking for a current account to receive your salary and do your daily expenses, we advise you to look into this.
If you plan to stay in Luxembourg for several years, you will probably want to buy a car, flat or houseYou will need a bank that offers all of these services, and you will also need furniture to furnish your new home. You will need a bank that offers all these services.
You might as well choose a bank that will be able to support you over the long term (and offer you preferential rates on your loans!). Here is an overview of the products that might interest you:
This is an account dedicated to the purchase of your main residence (flat or house). Each month, you save an amount that you define. This savings account allows you to deduct from your taxes, but also to benefit from a state guarantee for your home loanif your account is older than 3 years.
This is very interesting because the Luxembourg State will act as guarantor for you, and as you will not need to pay a bank guarantee, you will save money on your mortgage the day you buy a property
This is a financial investment that commits you to paying a certain amount each month. Part of this amount will be invested in obligations (low risk funds) and another part in stock exchange (in more or less risky investment funds). You choose the type of investment risk you want.
This type of investment is eligible for tax deductions each year. However, although you have the right to stop payments at any time, you must keep the scheme open until you are 60. If you close it earlier, you will have to pay back the tax refunded to you.
They can be used to finance the purchase of your furniture, household appliances or electronic devices (computer, tablet, smartphone, television, speakers, etc.). Some banks offer very attractive rates for consumer loans in Luxembourg.
You will be able to deduct part of the interest expense from your taxes each year, which can make consumer credit cheaper than paying in instalmentsin some cases.
They are intended for the purchase of a car. Some banks offer very favourable rates. In addition, you can deduct the interest charges from your taxes each year, which reduces the cost of the loan. This is probably why Luxembourgers often buy new cars: after tax deductions, the car loans are very inexpensive.
If you plan to stay in Luxembourg for several years, we advise you to choose a bank that also offers these types of financial products. All banks in Luxembourg offer these accounts, loans and financial investments.
However, as most banks offer similar services, compare current account offers may be a good way to break the tie.
To sum up, if you don't know which bank to choose in Luxembourg, we advise you to choose a bank that offers :
You can compare all the banking offers available in Luxembourg on this online comparatorFind the best bank for your budget, your desires and your situation.
You can choose a bank that offers low account maintenance fees (€3 to €5 per month) and includes a credit card (Classic, Premier). If you are looking to save money, choose an online bank. Most online accounts are free. However, you will need to take a credit card as an option, as you will not be able to pay everywhere with the VPay cards included in the online offers.
Analyse the different fees charged by the banks: account maintenance fees, withdrawal fees, transfer fees, overdraft commissions, overdraft interest rates, etc. Then compare the different banks. By comparing these criteria, you will easily find the best bank. You can do this on this online bank comparator.
ING, Spuerkess, BIL, BGL and Raiffeisen are among the banks we have selected because they all offer very attractive accounts. Some banks offer cheap online accounts. Others offer a whole range of advantages (preferential rates, 2 free credit cards...). In the end, the most advantageous bank will be the one that corresponds to your main objective: saving money or getting the best bank card with the best advantages. You can make your choice by consulting this comparison of bank accounts in Luxembourg.
BIL, BGL and ING offer a free online current account (0€/month). However, you will only have a VPay card: it will not allow you to make purchases on the Internet or to pay at certain machines (petrol stations, motorway toll booths, etc.). You will have to pay extra to get a credit card that allows you to do all these things.
In Luxembourg, all physical banks offer an interface for managing your accounts online. On the other hand, some of them offer online 100% accounts: all the management is done via the Internet. You will not have a dedicated bank advisor. It all depends on you: if you are independent and don't think you need financial advice, opt for an online account!
To choose your bank in Luxembourg, you need to analyse: account maintenance fees, the cost of the bank card, withdrawal fees from competing ATMs, transfer fees to external accounts, overdraft fees, and overdraft interest rates. You can make these comparisons easily on this site.
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