Following the example set by Western European countries, Citadele has introduced a savings tool which is new to the Baltics: the Green Savings Account, which offers savers an interest rate of 3.5%. Once the total savings amount reaches €10 million, the funds will be invested in apartment building insulation projects in Latvia and the Baltics, as well as other initiatives that support sustainability. Until the total savings reach €10 million, the funds will be saved in the European Central Bank (ECB).
After six months or after reaching €10 million, Citadele will divert the saved funds to finance sustainable projects, mostly apartment building renovation projects, as well as sustainable initiatives of businesses and private individuals. Savers will also have access to digital reports on where their funds have been directed and what results have been achieved.
The interest rate on the account is currently 3.5%, but this can be updated depending on the ECB decisions to increase the interest rates. Funds can be withdrawn from the account with a 60-day notice.
“Unfortunately, due to an extended period of 0% interest rates, savers may be wary of diverse types of deposits, but we are currently entering a new era of savings culture. Banks are already offering various savings tools with guaranteed interest income. Soon, next-generation savings tools could boost people’s enthusiasm for building savings. Alongside providing a guaranteed income, these next-generation savings tools will also offer additional functionalities. For example, allowing the accumulated funds to be invested in sustainable projects within savers’ country, thus helping reach European Green Deal standards. Similar practices are currently available in Germany, the Netherlands and Scandinavian region,” explains Citadele’s Chief Strategy & Business Development Officer, Member of the Management Board Vladislavs Mironovs.
European Union regulations of the European Green Deal directive stipulates a 55% reduction in CO2 emissions by 2030. This implies that all businesses, private individuals, and government organizations must adopt a comprehensive approach to process optimization, with special emphasis on minimizing their environmental impact.
“Recently, the topic of sustainability has been relevant in the financial sector. People can contribute to the promotion of sustainability through investments in diverse funds, bonds, and stocks. However, a savings account serves as a more accessible and comprehensible financial tool for a broader range of people. We see that sustainability initiatives are particularly important for younger generations — the Green Savings Account will allow to build savings while also supporting green projects in the Baltics,” adds Mironovs.
About Citadele Bank
Citadele’s mission is to modernise the banking sector and offer more opportunities to clients and businesses throughout the Baltics. In 2022, Citadele issued €1.2 billion in new loans in the Baltics, with its total loan portfolio reaching €2.9 billion, while total deposits reached €3.9 billion by the end of the year.
Alongside classic banking services, Citadele offers its clients a range of services based on next-generation financial technology, including its modern app, contactless payments, and instant payments. Citadele was the first in the Baltics to introduce opening an account with a selfie, payment rings and payments to mobile numbers.
The Citadele group is headquartered in Latvia. Its subsidiaries and branches operate in Latvia, Lithuania, and Estonia.
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