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Freedom24 D account savings: is it safe? Our analysis

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Fact checked by
Pedro Braz
Jul 5, 2024

On June 6th, 2024, the European Central Bank (ECB) decided to cut interest rates by 0.25%, which means that banks and brokers are expected to reduce the interest offered to their clients.

Trade Republic was the first broker to announce a reduction in interest on uninvested cash from 4% to 3.75%, in line with the ECB decision.

Freedom24 stands out from its competitors by claiming to offer interest rates up to 6.32% in EUR and up to 8.80% in USD (as of June 2024), much higher than expected for both currencies.

What’s the catch? Should you be worried? Let’s dig deeper!

In a nutshell:

  • Freedom24 is offering interest rates much higher than those offered by any other bank or broker;
  • Higher returns are often associated with higher risks, so caution is advised when investing in these products;
  • Their D-accounts and savings accounts are not protected by the Deposit Guarantee Fund, only by the Cyprus Investor Compensation Fund;
  • On August 15, 2023, Hinderburg Research, a well-known short-seller, released a report about Freedom Finance, the parent company of Freedom24, containing serious allegations. However, this has not resulted into any official proceedings, nor have the claims indicated in the report been verified by any official body, which is a positive sign for Freedom24’s operations.
  • The company may use its own shares as underlying assets to generate the interest rates claimed. In other words, Freedom24 can use the money from the D-accounts to invest in stock from their holding company, Freedom Holding. This presents a clear conflict of interest and a highly questionable practice;
  • Freedom24 is regulated by CySEC, complies with American audits by Deloitte, and receives detailed reviews from rating agencies like S&P. In the unlikely event of bankruptcy, your assets are protected up to EUR 20,000.

Freedom24 current offerings

Freedom24 offers two savings accounts that pay interest on uninvested cash (money “parked” in your account):

Savings D-account

In the Freedom24 D-account, it offers 3.83% in EUR and 5.33% in USD with no constraints whatsoever: there is no limit on the maximum deposit amount, and interest is accrued daily.

Freedom24 interest on cash

Unlike other brokers, where the interest comes from 1) deposits in financial institutions or 2) investments in Money Market Funds, Freedom24 uses swaps to earn the interest it offers (it is not a deposit). A swap is a contract between two parties that “promises” to exchange cash flows between them. It is outside of any exchange, so it is called “Over-the-counter (OTC).” Specifically, the current Freedom24 interest rate setup is a currency swap.

Is this arrangement safe?

It depends. It carries additional risks that may not be adequately compensated by the interest rates offered. The main risk is counterparty risk. Did you notice the quotation marks around “promises”? There is a risk that one of the parties may default on its obligations, meaning you may not receive the interest you were expecting.

As stated in Appendix Nº12 (to the general terms of business), Freedom24 “guarantees that any loss suffered by the Client due to a default or insolvency of a third party involved in the Swap transaction is subject to full indemnification by the Company towards the Client”.

Despite this Freedom24 guarantee, brokers have no legal obligation to maintain capital reserves, unlike banks. Therefore, there is no assurance that the company will be able to reimburse customers if necessary.

Finally, there is a clear conflict of interest. From the same Appendix Nº12: “By accepting this Program, the Client acknowledges and accepts that there may be inherent conflicts of interest when an FRHC stock represents the underlying Financial Instrument” (our bolding). In other words, the company may use its own shares as the underlying asset to generate the claimed interest. We consider this to be a very questionable practice.

Long-term savings plans

This product differs from the daily savings plan (D-account) primarily because it has fixed periods (3, 6, or 12-month plans). If you withdraw your money before the expiration date, you will face penalties: no interest is paid, and you only receive your initial capital

The rates may vary when visiting the Freedom24 website but do not change once you enter a fixed-period program; they remain unchanged throughout the chosen term.

The reason that rates may change is that they are tied to SOFR and EURIBOR interbank rates, as indicated across Freddom24’s pages.

The minimum amount is EUR/USD 1,000, with added benefits for amounts over EUR/USD 100,000. As shown, the rates can go as high as 6.32% in EUR and 8.80% in USD:

Freedom24 Long-Term Savings Plans - As of June 2024

Freedom24 markets this product with the wording “Term of deposit”, but it is not actually a deposit (as confirmed by customer support).

From their website, we read: “The long-term savings plans interest rates are calculated with multipliers of 1.1, 1.25 and 1.5 applied to the SOFR and EURIBOR rates, for 3-month, 6-month and 12-months placements respectively”, without any further details.

In EUR, the maximum should be 3.75%, as per the “deposit facility” (interest rate earned by banks when depositing money in the ECB). Above that amount, the broker should be losing money. For the USD, the same logic applies. The maximum that brokers should pay their customers on deposits would be 5.25%, according to the federal funds rate.

Please remember that both the “Savings D-account” and the “Long-Term Savings Plans” are not protected by the Deposit Guarantee Fund. Instead, they are covered by the Investor Compensation Fund (more on that below).

Is Freedom24 safe?

No broker is 100% safe, but there are safeguards in place. Freedom Finance Europe Ltd, the legal name of Freedom24, is regulated by the Cyprus Securities and Exchange Commission (CySEC) under license CIF 275/15.

Freedom24 clients’ assets are segregated into separate entities and thus should be protected against insolvency. In the unlikely event that the segregated assets cannot be returned to clients, Freedom24 clients fall under the Investor Compensation Fund (ICF), which compensates for any losses from non-returned investments up to EUR 20,000 (including the cash in savings accounts).

Freedom24 acts only as an intermediary between you and the stock exchange, meaning that the stocks you buy are yours. In an extreme bankruptcy scenario, the regulators would assign an asset manager, after which clients would be able to request to transfer their assets to another broker.

Please note, however, that Freedom24 is not regulated by top-tier regulators like the FCA or ASIC.

As such, we advise against using this broker for amounts greater than 20,000 euros guaranteed by the Investor Compensation Fund, as there are other alternatives.

The Hindenburg report

On August 15, 2023, Hinderburg Research, a renowned short-seller, released a report about Freedom Finance, the parent company of Freedom24. The report includes serious allegations, such as “Brazen Sanctions Evasion, Hallmarks of Fabricated Revenue, and Risky Bets with Commingled Customer Funds”.

It is an extensive read but worth your time! Freedom24 responded the following day (here).

While regulators have inquired for additional information as part of the due process to verify any public allegations, nearly a year after the Hindenburg report, no formal process has been initiated by any regulatory body. These regulatory bodies have not issued any official conclusions indicating any wrongdoings, which is a positive sign for Freedom24’s operations.

Freedom24 alternatives for interest on uninvested cash

If you’re looking for alternatives to the Freedom24 D-account and savings account, check our articles, where we filter the best brokers and digital banks for getting interest on your cash in EUR and USD.


When it comes to investing your hard-earned money, it is important to choose a broker you can trust.

Freedom24 has seen exponential growth in the last few years, and is offering very high interest rates to their users, higher than any of its competitors.

Freedom24 is a regulated broker, with hundreds of employees, and owned by a publicly-traded company.

On the downside, higher rates generally mean higher risk, and the company has been in the spotlight for bad reasons, as explained in this article.

Our goal is to help you make better-informed decisions, so explore Freedom24 and decide for yourself!

Have any feedback or doubts about Freedom24? Contact us and let us know your experiences.

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About the author
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Franklin Silva
Co-Founder & Fintech Analyst

Franklin has three years of experience in Wealth Management as a Fund Research Analyst, has passed the CFA level II, and is the host of the "Edge Over Hedge" YouTube channel.

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