# Raisin Deposit - how safe are these?



## Marobar1 (25 Feb 2021)

Hi there,

I'm about to deposit approx €95k via Raisin.ie with Privatbanka from Slovakia.

It stats that deposits are fully guaranteed by the Slovak Deposit Guarantee Fund (Fond ochrany vkladov) for amounts up to €100,000. 

My question is does this mean that my deposit is risk free as long as it is less than €100k?

Thanks in advance!


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## NoRegretsCoyote (25 Feb 2021)

My own pretty well informed view is that <=€100k deposits are completely safe everywhere in the EU.

But if a bank fails there could be delays to refunds. AFAIK there was a three-month delay in refunding deposits after a bank failure in Bulgaria in 2014.


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## ArthurMcB (25 Feb 2021)

Theyre covered by the deposit guarantee so i think its risk free


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## mc-BigE (23 May 2021)

I'm about to transfer my 4 year an post bond which is coming to maturity at the end of month. Anyone have any issues with Raisin Bank (via J&T banka Czech republic) never done this before, are there any tax implications when returning the money back to irish bank account at maturity?

Also another question asked is about which court would you prefer if there is a dispute, normal court or arbitration court. Again, not reassuring


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## newirishman (23 May 2021)

Not sure if I would go to a Slovakian Bank for the princely sum of €950 interest per year before tax on 95K on a 2 year fix.
Czech Republic is not in the Euro zone, which might or might not have further drawbacks (you are covered by the €100K guarantee though).


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## mc-BigE (23 May 2021)

It's 1.36% aer on 50k over 5 years. Not great, but it's savings and don't want high risk


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## lukegriffen (23 May 2021)

I've been using raisin for the last 4 years with no issues, any email queries they usually respond to within 24 hours, & there's an Irish phone no you can ring(which I presume is answered in Brussels or wherever). Getting paid back to your Irish acct is simple process, you just get a txt message with a code to confirm.

The tax implication is you have to file that you've opened a foreign bank acct & then pay the balance of interest/dirt to Irish rev. Commissioners.


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## Marc (29 May 2021)

I remember picking up the pieces with some U.K. savers who had placed money with ICE save and the subsequent mess that the collapse of an Icelandic bank created.









						Icesave dispute - Wikipedia
					






					en.m.wikipedia.org
				




Depositors found out that the deposit guarantee funds are actually a fund and that they can and do run out of money to repay depositors. Now, in this case savers were  ultimately protected by the Dutch and U.K. governments picking up the tab when the money ran out from the deposit guarantee scheme.

so you would be relying on either the ECB stepping in if it’s a country in the EURO or in this instance you’d have to hope the Irish government would make good on a potential shortfall on the deposit guarantee fund.

The prudent course of action is to apply the logic that higher interest rates must reflect some manifestation of risk. It doesn’t matter that it seems low risk. If there is a premium in the interest rate it’s because the institution has to pay more to attract deposits because it’s more risky.

Under those circumstances the prudent saver passes on these accounts and uses state savings instead.









						How Do I Get The Best Return On My Savings? - Everlake
					

We strongly advocate that longer-term investments should be arranged via pensions and stock-market linked investment accounts.




					globalwealth.ie
				




Marc Westlake
Chartered Certified and European Financial Planner
www.globalwealth.ie


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## NoRegretsCoyote (29 May 2021)

Marc said:


> so you would be relying on either the ECB stepping in if it’s a country in the EURO or in this instance you’d have to hope the Irish government would make good on a potential shortfall on the deposit guarantee fund.


A lot has changed since then.

The EU now has a fund of about €60bn to deal with a bank resolution where the national deposit guarantee scheme isn't enough.


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## Marc (29 May 2021)

NoRegretsCoyote said:


> A lot has changed since then.
> 
> The EU now has a fund of about €60bn to deal with a bank resolution where the national deposit guarantee scheme isn't enough.


Which sounds a lot but that €42billion is what, about a third of the deposits just in Ireland. How much cash is there in total in the banking system that is meant to be covered by these guarantees ?


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## tomdublin (29 May 2021)

When Cyprus's banking system collapsed and their deposit guarantee scheme ran out of money the initial plan agreed by EU leaders was to make EU help dependent on all savers losing a percentage of their savings.  This was later reversed and deposits up to 100,000 were covered in full, but it's a useful reminder that there is no such thing as an EU deposit guarantee scheme.  If a very large country were to experience a similar collapse (Italy is a possible candidate) existing EU bailout mechanisms wouldn't suffice without massive money-printing by the ECB (which probably would happen but again there are no guarantees).


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