August is primarily a month of holidays. And the Spaniards wanted to enjoy them, despite the high prices for hotels and travel packages. Example: despite inflation and the economic situation, citizens went on vacation, as can be seen from the data on deposits. Households withdrew €3.3 billion from deposits in August. A trend that has been observed since December 2022, although there was a slight increase in June. The lack of reward for these products means that Spaniards turn to them for recreation or even to make ends meet.

If you look at the evolution of these products this year, Spanish households exported more than 22.8 billion euros. All indications are that this withdrawal of money is being driven by a search for products offering better returns, as 12-month deposits averaged 2.36% in July. Despite this being the highest level since January 2013, Spaniards are not seeing enough of it. The second reason is the fight against the rising cost of living.

At the end of August, households deposited a total of €981.5 billion with Spanish banks, the lowest level since March 2022, after they withdrew 0.33% of their funds in just the eighth month of the year, corresponding to absolute figures of around 3.3 billion, according to the Bank of Spain.

At an interannual pace, volume is 1.22% lower than in August 2022, which means 12.1 billion euros less than then. Experts say the decline is because many customers have been “forced” to move their money into funds and other products such as savings insurance, as most banks still tend not to pay out deposit rewards.

Although, they admit, the fall could have been much greater if some institutions, although smaller in size, had not begun to stimulate the supply of deposits by offering higher interest rates.

In the recent past, the household trend has been to steadily increase bank deposits as the economic crisis caused by the Covid-19 pandemic worsened and households opted for greater prudence in their spending.

However, August 2022 marked a turning point as about $3.8 billion in deposit withdrawals occurred that month, very similar to what is happening now as families also use their savings to cover vacation costs.

Companies withdraw 15.2 billion per year

As for company deposits, the volume increased in August by 1.2% compared to July, amounting to $3.6 billion, to $302.6 billion. In fact, banks reward companies’ deposits to a greater extent. Specifically, in July the interest rate on these 12-month products was 3.15%. However, if we take into account the amount accumulated since the beginning of the year, the withdrawal will still occur in the amount of 15.2 billion.

Compared to last year, company deposits fell by 4.78%, although they have fluctuated both up and down in recent months due to ongoing liquidity needs.