At the onset of the financial crisis, the European Central Bank (ECB) began to lower its three key interest rates (click here for the time series).
The deposit facility rate, which constitutes a floor for the overnight interest rate at which banks lend to each other, has been negative since June 2014. This meant that banks had to pay to deposit funds in their accounts at the ECB. Over time, this led some euro area banks to pass part of these costs through to certain types of depositors, such as large corporations.
The ECB does not set negative interest rates in the spirit of “punishing” savers. Rather, it does so to encourage households and businesses to spend more or invest, with a view to stimulating the economy and ensuring that inflation returns to its medium-term target of 2% on a lasting basis. Inflation converging to its target will pave the way for interest rates to return to higher levels.