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German fintech firms simplify banking condition

Insurance brokers and fintech businesses in Germany are teaming up to offer combined services of insurance and a blocked account that they say will simplify the visa application for inbound international students.

A blocked account is a restricted savings account, which students applying for a study visa often use. Photo: Flickr/ Marco Verch

Deutsche Bank used to be the main providers of blocked accounts

Fintiba has linked up with insurance company, MAWISTA, while Expatrio Global Services has teamed up with insurance broker DR WALTER.

“We can do it in a few days but in the past it took a few weeks”

With Germany hitting its target of hosting 350,000 international students three years early, both sides of the burgeoning businesses see a demand for improved streamlined services.

International students must prove they have sufficient funds and insurance to obtain a student visa for Germany.

Unless students have a guarantor or a scholarship, they usually prove that they have sufficient funds for the duration of their studies via a blocked account, according to Dominic Otto, co-founder and managing director of Expatrio Global Services.

“With the digital process, we can do it in a few days but in the past it took a few weeks because paper had to be sent from the embassy abroad, to a German bank in Germany,” he told The PIE News.

Both Fintiba and Expatrio began operating in 2017.

A blocked account is a German account that students pay into when applying for a visa. €8,640 is deposited in usual cases, and over the year of study the account pays out a monthly allowance of €720.

“I think it’s something very German,” Jonas Marggraf, managing director of Fintiba said.

According to Marggraf, German authorities want more proof than a bank statement, and students are looking for services that make visa applications easier.

“On the one side the student ensures to have enough money for monthly living, and the government knows there is enough money for the full year,” he said.

The “cumbersome” application process has suffered problems with delayed paperwork or spelling mistakes resulting in embassies not accepting accounts because of mismatching names, according to Marggraf.

It has meant that students often missed the opportunity to go to Germany or they would go elsewhere, Marggraf explained.

“The foreign office in Germany were very keen on tackling that issue.”

Claudia Reichstein, director of international sales at DR WALTER insurance brokers, explained that a blocked account is a safety net for parents.

“It makes the students’ lives easier, but it’s also helpful for receiving institutions to know that it’s a combination of services that are available, students get advice on which the right service to get,” she said.

Deutsche Bank used to be the main providers. Smaller banks in the students’ home countries have also provided alternative options.

“The old insurance and banking world was very analogue, using paper confirmations and the student did the rest,” Marggraf added.

DR WALTER has been providing insurance for students inbound to Germany for many years.

“We see that we need to do more than provide insurance,” Reichstein said. “For the visa you need a blocked account [and] medical insurance, this is why we partnered with Expatrio.”

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One Response to German fintech firms simplify banking condition

  1. A really nice detailed article. It is true I totally agree. Germany has played much better. A lot of blocked accounts and insurances firms are revolving around students. There is a new blocked account company like fintiba but it is called Coracle. I heard about another company I think it is called Expatrio.

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