Study: Latvians Have the Most Savings in the Baltic States, Estonians Narrowly in Second Place
According to their claims, 86% of Latvians, 82% of Estonians, and 71% of Lithuanians among the Baltic population have savings, according to a recent survey conducted by Kantar EMOR.
According to Jonna Pechter, the head of Bigbank Estonia who commissioned the survey, it emerged that more than half of the residents of the Baltic countries still keep their savings in a regular bank account. "Money sitting in such an account is, of course, completely unprotected against inflation. Without reasonable options, people have lost the habit over the years and even the belief that their money could earn something in their home bank," Pechter points out the sense of resignation as one of the main reasons.
According to the survey, 24% of Estonians, 26% of Lithuanians, and only 8% of Latvians keep their savings in fixed-term deposits. "For a long time, the foreign major banks dominating the market in the Baltic countries offered their clients practically no simple and safe, yet income-generating savings options, and so even a few years ago, the margins on fixed-term deposits were near zero," notes Pechter, but adds that the trend of the past couple of years is nevertheless positive and savings are becoming popular again.
According to the survey, 43% of Estonians, 37% of Latvians, 18% of Lithuanians use savings accounts with generally lower interest but quick access, and 30% of Latvians, 29% of Lithuanians, and 26% of Estonians keep their savings in cash. "These numbers confirm that a large part of people keep some part of their savings readily available at all times. At the same time, probably without realizing it themselves, that instead of keeping cash in a sock drawer, the same amount would earn 2-3% interest per year even from a savings account with quick access," comments Pechter and recalls that in Estonia, the state Guarantee Fund protects bank deposits up to the value of 100,000 euros per person.
According to Jonna Pechter, years of efforts by foreign major banks to use money in people's accounts for free have unfortunately been successful. "We have learned from focus group studies that many people think that if they keep money in another bank, they should end their relationship with their current home bank and redo all contracts, which of course is not true. At the same time, it is beneficial for those with a large market share that people don't know things too well," Pechter points out low awareness as one of the ongoing important problems.
The research company Kantar EMOR conducted the survey at Bigbank's request in the fourth quarter of last year, and 1,025 people participated in it in Estonia.
