German banks warned over illegal P-Konto fees and restrictions

The Verbraucherzentrale Hamburg has warned against illegal practices by banks regarding the conversion of standard checking accounts into seizure protection accounts (P-Kontos). Some financial institutions have reportedly charged higher fees for P-Kontos than for regular accounts, deleted credit lines, or restricted previously included services such as debit or credit cards.

The German Federal Court of Justice (BGH) has ruled against both Deutsche Bank and Sparkasse Bremen on these matters. The court determined that banks cannot charge additional fees to fulfill their legal obligation to provide seizure protection, nor can they unfairly disadvantage customers by increasing monthly costs or removing contractual services during the conversion.

A P-Konto is a feature that protects a monthly basic allowance—currently 1,590 euros—from creditors, ensuring individuals can cover essential living costs. This protection applies to all types of income, including salaries and social benefits. Under German law, any account holder has the right to request this conversion at any time, even if they have a negative balance or no active seizure currently in place.