Savings interest rates Irish banks vs. abroad

Are you making the most of your money? Irish savings interest rates often fall behind those available in other European countries. Some Irish banks’ savings interest rates may not offer the best returns compared to deposit interest rates in Europe. But why is this the case? And where can you find the highest interest rates in Europe for your savings? Explore how savings account interest rates in Ireland compare to those abroad and what factors influence these differences.

The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.

There is no simple answer to this question, as savings interest rates are constantly changing. Banks adjust their rates based on economic conditions, central bank policies, and market competition. What may be the highest interest rate savings account in Ireland today could be overtaken by another provider tomorrow. Similarly, the highest interest rates in Europe vary by country and financial institution, depending on factors such as inflation, monetary policy, and consumer demand for savings products.

Instead of focusing on a single best rate, it may be more useful to understand what drives these fluctuations and how to compare different savings account interest rates in Ireland and abroad. The following sections will explore these factors in more detail, helping you assess whether Irish banks’ interest rates meet your needs or if better opportunities exist elsewhere.

Savings interest rates vary due to a combination of economic, regulatory, and competitive factors. Banks set their rates based on broader financial conditions, national policies, and their own business strategies, which means interest rates can differ significantly between Ireland and other European countries.

Here are some of the key factors that influence these differences:

• Central bank policies: Institutions like the European Central Bank (ECB) set benchmark rates that influence how much banks can offer on savings. When central banks raise or lower interest rates, savings rates typically follow.

• Inflation levels: Countries with higher inflation often have higher interest rates to help maintain the value of savings. 

• Bank competition: In countries where banks actively compete for customers, they may offer higher interest rate savings accounts to attract deposits. In contrast, if fewer banks dominate a market, rates may remain lower.

• Government regulations and deposit guarantees: Some governments impose regulations that affect how much banks can offer on savings. Deposit protection schemes such as the European deposit insurance scheme can also impact how banks structure their savings products.

• Economic conditions: Factors like GDP growth, employment rates, and consumer confidence affect how much money people save and, in turn, how banks set their deposit interest rates.

• Bank funding sources: Banks that rely on customer deposits for funding may offer better interest rates, while those with other revenue sources, such as investment income or mortgages, may prioritise different financial products.

As of May 2025, the highest interest rates offered by Irish banks are primarily found in regular saver accounts, which typically require consistent monthly deposits and may have balance limitations. It's important to note that these rates are subject to specific terms and conditions, and savers should ensure they meet the account requirements to benefit fully.

Current savings interest rates offered by Irish banks (May 2025):

Interest rates vary depending on the type of savings account. Regular savings accounts, fixed term deposits, and easy access savings accounts all offer different rates based on their specific terms and conditions. Some accounts provide higher rates for a limited period, require minimum monthly deposits, or restrict access to funds to encourage long-term saving. 

The banks listed in the table are among the most widely used in Ireland and currently offer publicly available retail savings accounts with competitive interest rates. For the most accurate and up-to-date information, official bank websites and direct inquiries remain the most reliable sources.

Savings interest rates in Europe vary significantly between countries and financial institutions. While Irish savings interest rates have traditionally been lower than some European counterparts, certain banks abroad offer more competitive rates to attract savers. Irish banks have cut their savings interest rates in recent months, whereas many European banks still offer more competitive returns, particularly on fixed term deposits.

A key difference is minimum deposit requirements. In Ireland, accessing the best rates often requires larger deposits, while many of our partner banks offer higher returns with lower entry amounts. Additionally, many Irish banks focus on short-term savings, whereas European banks provide a wider range of fixed-term options with guaranteed rates.

Savings interest rates vary across Europe, with many countries offering higher returns than those available in Ireland. While the European Central Bank (ECB) sets a benchmark rate, national banking conditions, competition, and financial strategies influence how much banks offer on deposits. In Ireland, a combination of factors keeps savings rates relatively low compared to other European markets.

• Limited Competition: The departure of Ulster Bank and KBC has reduced competition in Ireland, allowing remaining banks to keep rates lower without losing significant market share.

• Bank Profitability Over Depositors: Major Irish banks, such as AIB and Bank of Ireland, have reported record profits in recent years, prioritising shareholder payouts over higher savings rates.*

• Monetary Policy Impact: While the ECB’s interest rate decisions influence all Eurozone banks, different national economic conditions lead to variations in how these rates are passed on to savers.

• Fintech and Alternative Banks: In many European countries, online banks and fintech platforms compete aggressively by offering higher interest rates, a trend less developed in Ireland.

Fixed term deposits, also known as time deposits, allow savers to lock in their funds for a specified period in exchange for a predetermined interest rate. These rates can vary significantly across different countries and financial institutions. Fixed term deposit rates in Ireland are generally lower than those available across Europe. Irish banks often have higher minimum deposit requirements and fewer term options, while our partner banks offer more competitive rates and greater flexibility. Through Raisin Bank, savers can access higher fixed term deposit rates with terms of up to five years, allowing for more tailored savings strategies. For those seeking better returns on their lump sum deposits, our platform provides a strong alternative, with full deposit protection under EU regulations.

Comparison of savings interest rates: Irish banks vs. our partner banks

Below is a comparison of fixed term deposit rates offered by select Irish banks and our partner banks across various terms, as of May 2025:

The Deposit Guarantee Scheme (DGS) ensures that savers are protected if their bank fails. While Irish savings interest rates may be lower than in other European countries, deposit protection works similarly across the Eurozone, with a standard coverage limit of €100,000 per depositor, per bank. However, there are some differences in how these schemes operate in Ireland compared to other European countries.

In Ireland, the DGS is managed by the Central Bank of Ireland and covers banks and credit unions that are authorised to operate in the country. It is funded by contributions from participating institutions, ensuring that taxpayers do not bear the cost. If a bank fails, eligible deposits are meant to be reimbursed within 20 working days.

Across Europe, each country operates its own national deposit protection scheme, but all follow the same EU directive. Some countries, such as Germany and Italy, have additional voluntary schemes that provide extra coverage beyond the standard limit, but the speed of reimbursement and the structure of funding are similar.

Finding the best savings interest rates can be challenging, especially when comparing options in Ireland and abroad. With Raisin Bank, opening a savings account is simple and free. Once registered and approved, you can choose from a range of high-yield savings accounts from across Europe and start earning competitive interest on your deposits. Whether looking for fixed-term deposits or flexible savings, our platform makes it easy to find the right option to help your savings grow.

*https://www.reuters.com/world/europe/irelands-aib-ramps-up-shareholder-returns-after-profits-jump-2025-03-05/?