Banking

The Belgian banking environment has suffered heavily from the recent global financial crisis, with the federal and regional authorities implementing measures to shore up the banks’ balance sheets and restore confidence.

All institutions now have access to state-guaranteed funding and some of them have been bailed out by the government. The failure last year of Iceland-based Kaupthing Bank – which had attracted large deposits in Belgium – was a wakeup call for the government, which increased deposit protection from €20,000 to €100,000. 

Changes in the banking system

The banking scene has changed dramatically in recent years. Mergers between banks have reduced the number of Belgian banks and increased the presence of foreign banks in Belgium. Four large Belgian banks – Fortis, ING, KBC and Dexia – offer a range of banking and financial services in every market segment.

Within the banking sector, the past few years have also seen a breakdown of traditional boundaries as government-owned banks become privatised and merge into other financial groups. As a result, banks can offer a more complete range of financial services, from savings accounts to retail and wholesale credit loans, financial markets and both private and corporate banking services.

A large number of foreign banks, mostly from other EU member states, operate in Belgium through branches or subsidiaries. They focus on foreign exchange dealings and the servicing of foreign companies operating in Belgium. Some international banks position themselves on the domestic market, providing services for individuals. The Belgian Post Office also offers banking services. Some banks offer specific expat services and provide these services in English.

Accounts

Opening a current account (compte à vue/zichtrekening) is a fairly straightforward affair. All you need is proof of identity: either a passport or Belgian residence card. A current account usually bears a minimum interest rate.

Most banks give you an overdraft facility, varying from bank to bank: some automatically allow you credit of up to €1,249; others draw the line at €247.89, so shop around. If you wish to arrange a bigger overdraft facility, most banks are accommodating. Ask about bank charges too, as they vary from bank to bank.

The use of cheques is very rare in Belgium and usually more expensive than electronic systems of payment. You can use Bancontact/Mister Cash cards at cash machines to withdraw cash, check your balance and carry out electronic transfers including bill payments. The same card can be used to pay for goods and services at some 75,000 retail outlets equipped with Bancontact/Mister Cash payment terminals. If the Maestro function is added to the card, you can use the card worldwide.

For small payments, the Proton chip function, available on many cash cards, can be handy. This allows cardholders to load amounts from €5 to €125 on to their cards from their current accounts. You can load these amounts electronically from ATMs, public phone booths, bank branches or self-service banking facilities. Proton eliminates the need for small change to carry out minor everyday financial operations such as buying a loaf of bread or a newspaper. Many parking meters and telephone booths are also equipped with a Proton payment facility.

Visa and Master Card are also available and usually linked to your current account. Diners, American Express and all other major international credit cards can also be obtained and used in some of Belgium’s shops, supermarkets, restaurants.

However, some expats may feel they do not even need to open a local bank account at all, particularly if their employers are taking care of paying the rent, utilities, etc. Cash payments can be made using international credit or direct debit cards but other local payments should be made via a local bank or post office. Nevertheless almost all expats agree that there is more to banking than payment services, and that a local account is also handy to make regular local insurance payments, or as a key to investment services.

Deposit and savings accounts

Current account holders can also have a variety of savings accounts, including standard savings accounts (compte d’épargne/spaarrekening) or a bon de caisse/kasbon, which is similar to a certificate of deposit or a time deposit. Deposit accounts offer interest rates ranging from 1 to 3 percent (for residents in Belgium, per taxable person), depending on the bank. Interest on this account is non-taxable up to a ceiling of €1,600 (for residents in Belgium). This sum is increased yearly. However, you can’t draw cheques or make transfers from savings accounts except to your current account. Transfers can be made via phone and online banking services, at self-service banking facilities, in writing or in person at your bank. Savings accounts can also be used for regular automatic savings.

Making payments

The most common means of paying bills is by bank transfer (virement/overschrijving). Attached to most bills in Belgium, the distinctive orange and white forms need to be filled in, signed and deposited at your bank branch. It is also possible to pay bills at self-service banking facilities or via phone or internet.

Another common practice is the use of pre-authorised debits (domiciliation/domiciliëring). These are debits you arrange with your bank or utility company to have your gas, electricity and water bills automatically deducted from your account. A standing order (ordre permanent/doorlopende opdracht) can be arranged for regular (fixed amount) payments such as rent or mortgages. It is also possible to arrange regular transfers from your current to your savings account or to invest in financial products such as mutual funds or life insurance policies.

Banking by phone and internet

Phone and online banking enable you to carry out transactions from anywhere in the world. Most banks offer access to your account via digipass, or free software packages, users’ guides and support, although some charge for this.

International transfers

Transferring money from abroad can take a long time and be expensive. To accelerate transfers and to reduce the risk of error, ask for a Swift transfer and quote the Swift number of the Belgian bank. From the US or Europe, a Swift transfer normally takes from two to 10 business days. Larger commercial banks can usually carry out this transaction faster than smaller ones.

Some banks execute international transfers at lower-than-regular fees if certain conditions are met: full (error-free) details on the transaction to be made, no urgency and to certain countries. International payments in euro within the European Union (plus Liechtenstein, Norway and Iceland) of up to €50,000 and under certain conditions are as cheap as domestic payments in all countries concerned. Always mention your IBAN code (the international form of your bank account number) and the BIC code (the SWIFT code) of the bank to which you are transferring money. Transfers can also be made via certain ATMs, and via Western Union.

When shopping for a bank, keep in mind that as an expatriate you may travel a lot, be assigned elsewhere after your post in Belgium and may need to access or pay funds to a bank in Belgium long after you have moved. Be sure that the bank you choose can offer you all the services you require.

Mortgage and insurance services

With the recent enlargement of the European Union, increasing numbers of expatriates have moved into the Brussels area. This has not gone unnoticed by other longer-term expatriates who, as a result, have found it in their interest to invest in real estate in and around the city, particularly since prices compare favourably at an international level. Potential buyers should inform themselves of the full legal and tax implications of property purchase. To facilitate these purchases, banks offer competitive mortgage rates as well as life and fire insurance.

Financial investments - private banking

Larger local banks and some specialised banks offer financial investment products to expatriates: mutual funds, life insurance, stocks and bonds. Check the fiscal implications of your investments thoroughly, as often there may be tax advantages. For larger amounts, some banks are equipped with private banking services and may include tailor-made solutions for your specific needs.

Lost or stolen card?

If you lose your bank card or it is stolen, you can have it stopped immediately by dialling 070/344.344. You should also notify your bank.