Banks must raise savings interest rates, say Flemish socialists

Banks must raise savings interest rates, say Flemish socialists
Credit: Belga

The Flemish socialist party Vooruit wants to force banks to raise their savings rates to ensure they are not making "extortionate profits" off the backs of their clients, said the party's group leader Melissa Depraetere.

The interest rate on savings books may have risen slightly, but not nearly as much as the interest rates that banks receive these days for parking their money with the European Central Bank (ECB). As a result, banks have been making huge profits in recent years.

"It should not be possible for interest rates when taking out a loan to be so much higher than the interest rates savers get on their accounts," Depraetere said, adding that those rates should be linked to the base interest rate.

Depraetere's proposal comes in response to a letter of formal notice on the subject from Federal Finance Minister Vincent Van Peteghem to banking federation Febelfin, in which he pointed to the increased social pressure on raising savings rates.

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'Extortionate profits'

For Vooruit, however, Van Peteghem's letter does not go far enough. "Minister Van Peteghem can write as many letters as he wants, but we all know that banks are not impressed by that," Depraetere said.

"The Minister himself must intervene and force banks to clip their interest rates by law," she said. "It is unacceptable for banks to make extortionate profits on their customers' money, and on top of that to further reduce their customer services."

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