Holding of uninvested money in a Cash Account

A new solution for holding money will be offered to our clients. A personal Cash Account with an IBAN will be directly connected to your DEGIRO investment account.

During 2020, a new solution for holding money will be offered to our clients by our partner flatexDEGIRO Bank, a Germany based regulated bank. flatexDEGIRO Bank will offer a personal Cash Account with an IBAN for the holding of uninvested money, which will be directly connected to your DEGIRO investment account.

Safeguarding your uninvested money

Until now, when you become a client of DEGIRO, you give a standing order to invest your unused money into a Money Market Fund (MMF).

We will gradually replace this setup with a personal Cash Account in your name at flatexDEGIRO bank. Your money will then be held in a segregated personal bank account with a personal IBAN. This means your money is then also guaranteed up to €100,000 as the relevant German Deposit Guarantee Scheme (Entschädigungseinrichtung deutscher Banken) applies. Your new Cash Account will be directly connected to your existing DEGIRO investment account. It is not possible to use this Cash Account for other banking matters. You can only use it to hold money so that it is readily available for investments on your DEGIRO account.

Change comparison

Previous set up
Uninvested cash held in Morgan Stanley Liquidity Fund or Fundshare Cash Fund
Type Money Market Fund
New set up
Uninvested cash held in Cash Accounts (flatexDEGIRO Bank)
Type Bank account (IBAN)

Gradual roll-out of Cash Account availability

The possibility to hold money in a personal Cash Account with flatexDEGIRO Bank will be gradually rolled out to DEGIRO clients. During this transition, new clients may first make use of the Money Market Funds solution to hold their unused money and later get access to the personal Cash Account solution.

When your Cash Account is available

As soon as the EUR Cash Account becomes available to you, we will communicate this to you by e-mail. To open your Cash Account, all you need to do is complete the online form that will be made available to you on the trading platform after you log in. It will only take a few minutes of your time to complete.

What happens with the MMF?

With the introduction of the Cash Accounts, we will gradually end the MMF solution for holding uninvested money. This means that in the future, you will no longer be able to automatically hold your money in MMF's via the standing order. We will communicate the exact dates and details by e-mail.

We will replace the MMF’s for all currencies. We will inform you when Cash Accounts in specific currencies are available.

Please note that 45 days after we have given you the possibility to open your Cash Account, we will no longer compensate the negative interest of MMF's in line with the compensation policy of DEGIRO.

Change comparison

Previous set up
Uninvested cash held in Morgan Stanly Liquidity Fund or Fundshare Cash Fund
Type Money Market Fund
New set up
Uninvested cash held in Cash Accounts (flatexDEGIRO Bank)
Type Bank account (IBAN)

"As soon as the Cash Account becomes available to you, we will communicate this to you by e-mail."

Negative interest rates and compensation

Using a Cash Account is a safe and effective banking solution to hold uninvested cash that is linked to your DEGIRO investment account. All of the money held in your Cash Account can be used directly for trading as well as margin on your DEGIRO investment account.

Just as with the current Money Market Funds, the Cash Accounts have a downside, namely the possibility of negative interest. At first, we will offer only EUR cash accounts. The interest rate offered by flatexDEGIRO Bank for the EUR Cash Account is currently -0.50% (July 2021). For the USD and GBP Cash Accounts, there is currently no negative interest rate.

Concerning the negative interest for the Cash Account, DEGIRO will offer a compensation policy similar to the MMF compensation policy. Negative interest on the Cash Account is partially compensated by DEGIRO on a non-committal basis in the following manner:

  • Compensation will only be given for the first €2,500 in cash holdings for the Cash Account in your base currency (EUR). Negative interest on amounts higher than this will not be compensated.

    Example

    you hold €3,000 in your Cash Account, with an interest rate of -0.50% yearly. The negative interest of €12.50 paid as a result of the first €2,500 in your account is compensated by DEGIRO. You incur the €2.50 in negative interest on the remaining €500.

  • If you have paid €350 or more in transaction fees during a 60-day period, compensation will be given for the first €100,000 in cash holdings for the Cash Account in your base currency (EUR). This will be reviewed at the beginning of every month.

    Example

    you hold €50,000 in your Cash Account, with an interest rate of 0.50% yearly. However, you have paid over €350 in transaction fees during a 60-day period. The €250 incurred as a result of negative interest is then compensated by DEGIRO.

There are no entry-, exit- or other costs associated with the Cash Accounts.

About flatexDEGIRO

DEGIRO is part of flatexDEGIRO group, one of the 160 biggest German companies listed on the SDAX. The group's vision for 2025 is to service more than 3 million clients across Europe and to execute at least 100 million trades per year. You can read more about our partnership with flatex here.

Your assets are insured under the German statutory deposit guarantee scheme. flatexDEGIRO Bank is protected by the compensation scheme for German private banks (Entschädigungseinrichtung deutscher Banken). The deposit guarantee scheme protects up to €100,000 per client. More information about the Compensation Scheme for German Private Banks can be found here.

DEGIRO B.V. merged with flatexDEGIRO Bank AG in early 2021, creating the biggest online execution-only broker in Europe with its own banking license.

flatexDEGIRO Bank AG is under the supervision of the German regulator of financial markets, the BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht). Click here for more information about the BaFin.

Frequently asked questions

As soon as you have opened your (flatex) Cash Account with a unique IBAN, you will no longer deposit money to the bank account of Stichting DEGIRO, but instead to your new personal IBAN with flatexDEGIRO Bank. You can find this number and further instructions when you log into the trading platform. If you have accidently made a money transfer to the bank account of Stichting DEGIRO, this will be returned to you.

Since deposits and withdrawals will be made from your Cash Account with flatexDEGIRO Bank, it will no longer be possible to connect a secondary bank account. Therefore, you will only be able to use your current primary bank account for deposits and withdrawals. You can change your primary bank account a maximum of three times per 12 months. Please find further instructions in the trading platform. If you have accidently made a money transfer to the bank account of Stichting DEGIRO, this will be returned to you.

If you want to hold money in a different currency, this is still possible. For currencies which we don’t offer Cash Accounts for yet, you will continue making use of the MMF’s. We will inform you when Cash Accounts in other currencies are available.

No, there are no costs associated with holding the Cash Accounts or depositing/withdrawing money. Please note that the EUR account is subject to a negative interest of -0.50%. Please also see this document with an overview of the prices and services of the Cash Account.

More information about the compensation for negative interest can be found above on this page under ‘Negative interest rates and compensation’.

No, you can only use it to hold money, so that it is readily available for investments on your DEGIRO account.

No, this will not be possible. With the introduction of the Cash Accounts, we will gradually end the MMF solution for holding uninvested money.

This means that in the future, you will no longer be able to automatically hold your money in MMF(s) via the standing order. We will communicate the exact dates and details by e-mail. If you still wish to hold uninvested money for trading on your DEGIRO account, all you need to do is complete the online form and open your Cash Account.

Note: Investing involves risks. You can lose (a part of) your deposit. We advise you to only invest in financial products which match your knowledge and experience.

Note:
Investing involves risks. You can lose (a part of) your deposit. We advise you to only invest in financial products which match your knowledge and experience.