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    Private pension provision

    Debit interest: interest paid by the borrower on a loan received

    Interest on deposits: Interest that a bank pays to the saver for invested money.

    Key interest rates: Key interest rates are the interest rates set by a central bank, such as the European Central Bank, at which banks can obtain or invest money.

    Put simply, the lower the key interest rate, the cheaper the loans for banks. Since 2014, the key interest rate of the ECB has been close to zero. That is why it is still possible to take out loans at favourable rates today. However, the key interest rate also applies to credit interest, so you also get less interest on savings deposits

    Negative interest rates: Investors do not receive interest from banks, but must pay interest on their investments. However, only very high business customer deposits are affected by negative interest rates

    Nominal interest rate: The nominal interest rate refers only to the pure interest rate. The real interest rate, on the other hand, takes inflation and deflation rates into account. The real interest rate is calculated by subtracting the inflation rate from the nominal interest rate.

    Effective interest rate: In addition to the nominal interest rate, the effective interest rate also includes processing costs, expenses, fees and other charges

    Overdraft interest: Anyone who overdraws their current account pays overdraft interest. Depending on whether an overdraft limit has been agreed with the bank in advance, the interest rate will be higher or lower.

    Compound interest: When you invest money, you earn interest. If you further invest this money (including the earned interest) you again earn interest for this larger sum, and so on and so forth. This is called compound interest