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Ensuring protection when transferring money within Europe

Peter Stojanovic

When moving money from one country to another, people are often unsure what safety nets are in place to protect them. SavingGlobal's Michael Stephan introduces the EU's measures.

What are the deposit protection measures when money is transferred from one country to another?

It’s a sensible question, especially whilst we watch the unpredictable events between Greece and the European Union unfold…

…And one SavingGlobal, a German based deposits marketplace, should be able to answer.

This fintech startup allows its customers to access term deposit products of their partner banks from across Europe.

It streamlines a process that would normally use several forms in a different language and the new networks mean its customers can access higher interest rates abroad.

It’s an easy sell: 18,000 customers signed up for their hassle-free service in 14 months.

However, working so closely with European regulation and money transfers has its issues.

That’s because the single market framework that Europe handles, forms the basis of what companies like SavingGlobal work off and deposit protection is what most customers want assured.

COO of SavingGlobal, Michael Stephan, discusses the issues surrounding investment protection within a single market that has had a volatile recent history.

“Since the outbreak of the financial crisis and increasing pressures from the financial markets, the regime has become favored towards the consumer…”

Which sounds like a good thing, from a customer’s perspective.

One of the safeguards resulting from this favorable circumstance is the guarantees awarded to each customer.

“All term deposits are insured by up to €100, 000 ($110, 000) per investor per bank: they’re protected…”

Stephan carries on to say that each bank has up to 10 days to pay out the agreed amount after the default and that these rules are harmonized so every country acts in the same manner.

“…but your money is more safe in different countries.”

This is where some of the regulatory functions of Europe come across the subjective forecasts of investors.

“In the end it’s a different sovereign that’s backing the guarantee.”

And what else does SavingGlobal and investors have to think about in terms of deposit protection?

“You have to consider the political will of domestic and international politicians and how they help the small savers.”