Focus on Flexibility

Germany Cuts Red Tape for Refugees

Refugees Berlin - Muhammad Hamed Reuters Corbis
Refugees in Berlin, living in limbo.
  • Why it matters

    Why it matters

    Giving asylum-seekers access to banking and job training are key steps towards their integration.

  • Facts


    • Germany will assess the job skills of refugees while their asylum requests are being reviewed, to help them find work quickly once their papers are approved.
    • The program will cost between €1.8 billion and €3.3 billion next year alone, said the government.
    • The banking supervisory authority is relaxing rules to make it easier for asylum-seekers to open bank accounts.
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The German government is determined to do all it can to integrate asylum-seekers from war-torn countries like Syria as fast as possible.

It is to focus on how to get people into jobs quickly, as well as providing accomodation and access to bank accounts.

The country is expecting up to 800,000 aslyum-seekers this year, four times as many as last year. While many of these, particularly people from the Balkan countries, may fail in their asylum applications, a very large proportion of them are probably going to be in Germany for a long time to come.

Authorities are therefore looking at ways to ensure that they are not only provided with shelter immediately, but also that they can be given the tools to integrate into German society.

For a start, the German labor agency plans to dispatch specialists to ascertain their skills and retraining needs even while their asylum requests are being processed. That has been tried out in a number of cities under a pilot scheme launched last year, which is called “Early Intervention.”

Now, the system is to be applied across the country, said Labor Minister Andrea Nahles, adding that the changes will cost between €1.8 billion and €3.3 billion, ($2.03 billion-$3.73 billion) in 2016. In 2019, the cost could be as high as €7 billion.

However, with Germany declining population and a looming skills shortage, the benefits to the economy could be significant.

The government also plans to address problems many asylum-seekers are encountering in opening bank accounts in Germany. The Federal Financial Supervisory Authority, Bafin, has loosened the requirements for documents needed to open an account, Handelsblatt has learned.

In future, banks will be allowed to accept a variety of papers issued by German immigration authorities that only meet minimum standards, according to a letter from Bafin to the German banks’ umbrella organization seen by Handelsblatt.

All that will be required in future will be a document with the letterhead, stamp and signature of a German authority, plus a photo and personal details. The authority has created transitional rules that will apply until the law is changed next year.

Until now, state-owned savings banks have been the main banks accepting new migrants as customers. Their association is working to provide information brochures in various languages to help asylum-seekers find their way around the German banking system.

Until now, having one’s own bank account has been something of a luxury for many refugees in Germany because banks have refused to let them open one, usually citing strict laws against money laundering. But Bafin argued in its letter dated August 21 that allowing all migrants to open accounts would help combat money laundering by preventing “uncontrolled flows of cash.”

It’s doubtful that all banks will welcome asylum-seekers with open arms. Commerzbank, Germany’s second-largest bank, said it would still conduct a “risk assessment” for each new customer.

Privately, a number of bankers said that asylum-seekers tend to cost more money than they generate and that it was up to the savings banks to cater for them because they have close ties to local authorities and fulfil a public service role.

Without an account, it’s almost impossible to get a rental contract or a regular job, or to receive state benefits or to pay utility bills.

The savings banks already cater for migrants, even those without bank accounts, because in many cities they are in charge of benefit payouts to them. As a result, many tend to open their accounts with savings banks when they get a chance. “We don’t see that as a burden,” said a spokesman for the savings banks in the western city of Düsseldorf. If news spreads that the savings banks had helped the new customers through a difficult period, “it’s good, long-term, for our image and for customer loyalty,” he said.

The Bafin rules will tide Germany over until next year when a new law is expected to come into force entitling all legal residents to a bank account at a bank of their choice. The new law will be in line with a European Union directive coming into force by September 2016. Germany will likely enact the law earlier, at the start of next year.

Customers will be entitled to a bank card but won’t be allowed to have an overdraft. The only precondition is that the person must be legally in the European Union.

The finance ministry estimates that some 580,000 people in Germany don’t have a bank account; other estimates put the figure at 670,000. Most of the people affected are poor or homeless people, or refugees.

The lack of an account can cause social and economic marginalization, in a world where the use of cashless payment is on the increase. Without an account, it’s almost impossible to get a rental contract or a regular job, or to receive state benefits or to pay utility bills.

Asylum Seekers in Germany-01


Meanwhile, Germany is working to cut its notoriously elaborate red tape governing the construction and approval of new housing, in an attempt to make accommodation available quickly for the expected influx of 800,000 asylum seekers this year.

The association of German housing and real estate companies (GdW) is working on a catalogue of proposals for the government to relax rules on housing migrants. “We need workable solutions to guarantee the initial accommodation of refugees as well as their longer-term integration,” said GdW President Axel Gedaschko. “Existing legal frameworks need to be reviewed.”

It’s all in line with Chancellor Angela Merkel’s call on Monday for “German flexibility” rather than “German thoroughness” to tackle the crisis. She suggested that rules on fire protection or on energy efficiency could be relaxed to make accommodation such as converted army barracks available quickly.

However, the environment ministry, which is responsible for building and planning issues, warned against watering the rules down too much. “As a rule, there shouldn’t be concessions when it comes to fire safety and security standards,” said a ministry spokesman.

But exceptions are likely to be made nonetheless, said insiders. For example, in century-old military barracks that may be used for refugees, it’s unlikely that anyone will be demanding that historic stair banisters be raised to the required levels.

But the country has yet to work out a strategy for accommodating migrants over the long term, according to Mr Gedaschko.

“There’s no national strategy at present for how and where refugees remaining in Germany will live and be integrated.”


Yasmin Osman covers the banking sector from Frankfurt, Peter Thelen reports on the labor market from Berlin, Silke Kersting covers construction and environmental policy for the paper. To contact the authors:,,


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