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The €2 Billion Interest Rate Trap: Why German Companies Are Leaving Billions in Interest on the Table
While capital market interest rates have risen significantly again in recent years, the returns on many corporate bank accounts remain stuck in a state of “interest rate stagnation.” Current data shows that German companies hold a record €873 billion in liquid assets, of which €263 billion is held in traditional overnight deposits.
This is precisely where the problem lies: A large share of these funds is held with branch-based banks and savings banks at interest rates well below the prevailing market rate (€STR).
The result is a substantial “interest rate gap”: German companies are estimated to miss out on €2.0 billion in additional interest income every year because they do not invest their liquidity at market-based rates. This particularly affects Germany’s economically important Mittelstand—its small and medium-sized businesses—as well as holding companies and sole proprietors that maintain necessary liquidity buffers in their business accounts.
Interest rates on call money accounts are projected to rise only slightly in 2026:
1.42%
*
Average current interest rate on overnight deposit accounts for businesses
A comparison between the official euro short-term rate (€STR) and the interest rates actually paid on corporate overnight deposits illustrates the scale of the issue:
Market rate (€STR): 2.18% p.a. in January 2026
Average corporate overnight deposit rate: approximately 1.41% p.a. during the same period
According to the UnitPlus Corporate Overnight Deposit Index, German banks currently pass on only just over 50% of the potential interest to their business customers. The remainder is retained as part of the banks’ margins.
Corporate cash interest rates increase only slightly
Overnight deposits, Germany, interest rate, businesses, by month, in % p.a.
Source: BC Data, Barkow Consulting
Banks Pass On Only Slightly More Than Half of Available Interest to Businesses
Looking at corporate overnight deposit rates over the longer term, it becomes clear that banks have passed on only part of the rise in interest rates since 2022.
An exclusive interest rate study by Barkow Consulting highlights the extent of the disadvantage: In September 2026, the market rate (€STR) stood at 2.18%, while corporate customers received an average of just 1.42% on traditional overnight deposit accounts.
This difference of 0.76 percentage points is not a coincidence, but rather part of the business model of many branch-based banks. By passing on higher interest rates only slowly and incompletely, banks retain a significant share of the returns that could otherwise accrue to businesses.
Long-term trend
Overnight deposits vs €STR, Germany, interest rate, businesses & individuals, by month, in % p.a.
Source: BC Data, Barkow Consulting
Nearly 900 billion euros in bank deposits held by German companies
Banks’ insufficient pass-through of interest rates becomes particularly significant when looking at the development of corporate balances held in current accounts, overnight deposit accounts, and fixed-term deposits.
As of September 2026, German companies held €873 billion in bank accounts, representing substantial funds that are not being used for operational purposes. At the same time, inflation is causing a noticeable erosion of their purchasing power.
Companies with liquid assets of almost €900B.
All bank deposits, Germany, portfolio, companies, by month, in € billion.
Source: BC Data, Barkow Consulting
New providers are also enabling medium-sized companies to access market interest rates.
While access to market-rate interest rates such as the €STR was previously reserved almost exclusively for major banks and institutional investors, new providers such as UnitPlus Business are making this rate accessible to SMEs and limited liability companies (GmbHs).
This enables companies to invest directly in the money market in order to close this interest gap, benefiting from daily interest accruals and the maximum compound interest effect.
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