The public is losing hundreds of billions on unsecured account funds

By: Trademagazin Date: 2025. 11. 12. 09:30

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By the end of the third quarter, the stock of demand and current account deposits among the population had climbed to a record level, over 11,600 billion forints, while households only keep less than 15 percent of the money in current accounts in fixed deposits – points out Mihály Barát, financial journalist at BiztosDöntés.hu. Hungarians lose hundreds of billions of forints annually due to money lying around in accounts without being tied up.

The stock of unsecured current account deposits among the population increased by almost 15 percent in the year ending in September, setting a new record and exceeding HUF 11,615 billion, points out Mihály Barát, financial journalist at BiztosDöntés.hu.

Too much money is lying fallow

In comparison, he adds, it is of little consolation that the size of the entire retail deposit portfolio also set a record in September, exceeding 13,654 billion forints after an annual growth of 11.1 percent. “As a result of the rapid increase in the volume of sight and current account deposits, the proportion of untied, “resting” money in household current accounts is constantly increasing: by the end of the third quarter, it had already exceeded 85 percent, which has never been seen before,” highlights the financial journalist of BiztosDöntés.hu.

The increase in the proportion of untied account money is particularly noteworthy in light of the fact that the weight of time deposits was above 24 percent even five years ago, and in fact, in September 2015, households were still paying interest on almost half of the entire portfolio in some kind of deposit.

“Of course, taking that into account “When examining the ratios, it should be taken into account that the population keeps part of the money in current accounts to cover daily expenses and as a short-term safety reserve: at the same time, the unallocated ratio of around 85 percent is extremely high and obviously leads to a devaluation of the deposit portfolio,” states Mihály Barát.

The loss is not negligible at all: if we take the average interest rate of forint time deposits in September, which was 3.77 percent, then even taking into account interest tax and social contribution tax, we must expect an annual loss of 315 billion forints in interest on retail deposits.

The proportions are similar for foreign currency deposits, which currently account for approximately 17 percent of the retail deposit portfolio: here the weight of time-deposited funds reached only 14.7 percent at the end of September, while a year earlier it was 16.2 percent.

You can find interest rates well above inflation

An obvious explanation for the increasing proportion of demand and current account deposits may be that annual interest rates below one percent have been considered the norm for years for forint term deposits with a maturity of less than one year.

In comparison, the financial journalist of BiztosDöntés.hu points out that it is still possible to find very attractive offers in the banks’ offer, where the annual interest rate exceeds the rate of inflation and, in some cases, the central bank’s key rate of 6.50 percent. “The annual interest rates of 5-7 percent allow for a substantial return, even if we take into account that the interest on fixed-term deposits is subject to a 15 percent personal income tax (interest tax) and a 13 percent social contribution tax (szocho),” added Mihály Barát.

According to the data of BiztosDöntés.hu lekotott deposit calculator, of course, banks always attach conditions to promotional or preferential interest rates – for example, the placement of new funds is a condition everywhere.