The adage that practical people read passbooks no longer seems to apply. Today, their holders are increasingly reading letters from banks informing them that the long-popular savings tool is coming to an end. But with that comes complications.
This is the case of the reader of Pravda, who approached us with the information that her 82-year-old mother received a notification from VUB Bank that her passbook was closing and she could withdraw the saved money, about 6,000 euros, in cash at the branch. There, however, according to the reader, the bank’s employees told her that she should transfer the savings from the book to mutual funds.
VUB Bank confirmed to the daily Pravda that it is really canceling passbooks. But only for those clients who have low balances and who have not completed any transaction in the last 18 calendar months, ie neither a deposit nor a withdrawal for a book. The financial house also claims that they sent the notification to clients by letter three months in advance.
“We correctly sent the information to our clients three months in advance, but then a transitional period still applies, until the end of June 2025, until they can withdraw the funds. What is very important, of course, is that clients can do what they want with their funds, they don’t automatically get anything else, ”Dominik Miša, PR manager of VÚB banka, in which the reader had a passbook, responded for Pravda. The responsibility thus remains largely on the prudence of the clients themselves.
Another of the large financial houses – Tatra banka – has also confirmed that the sale of the product has ended and the existing passbooks are gradually being canceled. “We actively address clients with passbooks and inform them of their options,” said Simona Miklošovičová, a spokeswoman for Tatra banka, and said that the offered alternatives take into account, for example, the amount of the balance on the passbook or its currency.
How savings on passbooks worked
A passbook is a security that confirms that the bank has received money from the deposit holder. The passbook can be kept in domestic as well as in foreign currency.
- passbooks are a financial product intended for financial consumers, and are similar to a savings account
- were offered by banks in order to increase your free funds
- when it was established, the bank physically issued a passbook and simply entered deposits and withdrawals into it
- There were two types of passbook deposits: cash at any branch of the bank that issued the passbook, or cashless transfer from an account (with simultaneous entry on the passbook)
Types of passbooks
- no notice period – you can withdraw money at any time without notifying the bank in advance and the withdrawal is free of charge, they have a lower interest rate compared to passbooks with a notice period
- with a notice period – you must notify the bank in advance when you want to make a withdrawal from the passbook
ČSOB is doing the same. It offered passbooks only until 2014. After the merger with OTP banka, however, clients whose passbooks are also currently undergoing cancellation also passed under it. The reason is that with higher interest rates and simpler administration, as well as with the advent of electronic banking, they have gradually lost their justification.
“We canceled the passbooks completely in 2016, and clients could decide whether to withdraw the money or decide to move it to another type of product. Today, clients of the former OTP bank can decide whether to withdraw the saved amount in cash at a branch, invest in another type of product, or invest in mutual funds. We have been informing clients about these possibilities for several months now, ”adds Anna Jamborová, a ČSOB spokeswoman.