Bank account in Euro: Hungary vs EU

Blog
  • May 20, 2019

Did you know that some Hungarian citizens prefer to keep money not with a bank, but hidden at home or at work? Perhaps this is due to the high prices of banks for maintaining the account and transactions taxes. Many European expats are taken by surprise when finding out that withdrawing their own cash from their personal account will result in a loss of up to 2%. Even if you add up the 0.5 percent of your saving account profits, the investment of any currency rather than forint will not justify itself in Hungarian bank.

If you prefer to keep your savings in Euros rather than in Forints, the Plan B will be opening a bank account in another country neighboring Hungary. Almost all other members of EU have Euro as official currency. Until recently, opening a Euro account in neighboring Austria was not difficult for the Hungarian residence permit holder, even without European citizenship.

Since 2018, new money laundry and terrorism fighting laws were applied by European banks, this resulted in complication of the bank account opening procedure for both individuals and legal entities. Major European banks such as Erste and Raiffeisen have the strictest account opening policies, also customers of Sberbank and Unicredit are sublimed to the process of checking and collecting documents before opening account. Now the Austrian branches of large international banks require a permanent residence permit or work contract in order to obtain permission to open a bank account in Austria.

In any case, there is plenty more fish in the sea, you can reach out for the Hungary’s other close neighbor – Slovakia. The border between these countries quietly dissolves in the waters of the Danube Bend, and Hungarian and Slovak cities visit each other across the bridge in Komarom (Komarno) or Esztergom (Shturovo). As far back as the beginning of the 20-th century, the Hungarian borders extended far beyond the Danube, and it is not surprising that in the border cities Slovaks speak Hungarian between family members, and at work they better understand Slovak or English. Bank employees in Šturovo and Komárno are friendly towards companies registered in Hungary and foreigners with a residence permit in Hungary.

In the Slovak territory of the former Austro-Hungarian Empire, there are offices of Raiffeisen bank international group (Tatra banka), and the K&H (ČSOB bank), as well as Unicredit and Erste. Tariffs and service fees for maintaining a bank account will also seem decent compared to neighboring countries. The advantage of opening a bank account in Slovakia is the ability to quickly transfer funds through the SEPA European payment system. Transactions initiated from a Euro account to another Euro account of another bank in Euro zone are not subject to state tax or commission by the bank, and are also credited to the account in a matter of hours, taking no longer than one business day from the moment the payment is initiated.

Opening bank account in Slovakia is convenient for residents of Budapest, since a trip to the nearest bank will take no more than 1,5- 2 hours. The procedure for opening an account can only take one hour, provided that the documents and questionnaires were mailed in advance to the bank employee, and the legal department gave it a green light.

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