FRANKFURT: The European Central Bank is under fire in Germany because of its policy of negative interest rates, which is prompting some banks to charge customers for holding money in their bank accounts.
In Germany, where saving is considered a virtue, the announcement by one of the country's biggest lenders, Commerzbank, that it will start charging clients with high deposits on their accounts has angered many.
Commerzbank insists that mom-and-pop retail customers will not be affected and the so-called "deposit fees" will be levied only on major corporate clients holding more than 10 million euros ($12.5 million) on their accounts.
Nevertheless, at a time when savers in particular are already feeling the pinch from an extended period of ultra-low interest rates, Commerzbank's move "broke a taboo", complained the television news channel n-tv.
Some observers think it is only a matter of time before private retail customers are hit, too.
The idea behind the ECB's unprecedented decision in June to take eurozone borrowing costs into negative territory was to kick-start lending in the euro area.
In a bank-based economy such as the single currency area, the chronically low level of credit is regarded as the main hurdle to a broader recovery.
So the ECB decided to lower the rate on banks' overnight holdings with the central bank -- the so-called deposit rate -- to minus 0.10 percent, with the aim of "punishing" banks who park their excess liquidity with the central bank.
The German term for the practice reflects this thinking: negative interest rates are known as "Strafzinsen" or "punitive rates".
The logic was to give banks the incentive to lend the money to the private sector instead.
The ECB tightened the screws again in September by lowering the deposit rate further to minus 0.20 percent.
But the policy has had its critics from the start, not least in Germany, where the ECB's "unconventional" policies are generally regarded being too risky and overstepping its mandate.
Some ECB watchers warned in advance that the largely untested policy could actually have potentially harmful unforeseen consequences.
And such concerns now appear to be backed up by Commerzbank's move.
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