Greece Moves to Alleviate Cost-of-Living Crisis with Banking Reforms

Greece will eliminate bank fees for certain transactions to aid with cost-of-living challenges. The government plans to implement a property tax hike on unused bank-owned real estate by 2026. Additional measures include capping money transfer fees and utilizing banking revenues for school projects.

In a bid to ease the burden of a mounting cost-of-living crisis, Greece is set to abolish bank fees and charges on select retail transactions, announced Prime Minister Kyriakos Mitsotakis on Sunday. This is part of the center-right government's initiative to provide economic relief to households.

Speaking in Greek parliament prior to the approval of the 2025 state budget—which forecasts a 2.3% growth—Mitsotakis unveiled plans to introduce a 0.5 euro cap on money transfer fees for transactions up to 5,000 euros. Additionally, charges on dealings with state and utility providers will be scrapped.

Analysts anticipate banks will lose millions annually from the reduced fees, given current revenues of approximately 200 million euros from such charges. Banking profits reached 3.8 billion euros in 2023, with plans to reinstate dividend distributions after 16 years. An additional 100 million euros will support school renovations and construction efforts.

(With inputs from agencies.)