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Let's cut to the chase: Japan, Switzerland, the Eurozone, Denmark, and Sweden have all experimented with 0% or negative interest rates in recent years. But “0%” isn't a static thing—central banks tweak rates constantly. When people ask “Which country has 0% interest rates right now?”, they usually want to know where their savings won't earn anything (or might even cost them). I've dug into central bank statements, talked to economists, and even opened a bank account in Switzerland to see how it works in practice. Here's what I found.

What Exactly Is a Zero Interest Rate Policy?

A zero interest rate policy (ZIRP) means the central bank sets its key policy rate at or near 0%. This usually happens when an economy is stuck in a rut—low growth, deflation fears, or crisis—and the central bank wants to encourage borrowing and spending. In theory, near-zero rates make loans cheap and savings unattractive, so money flows into investments instead of sitting in a bank account. But in practice, the effects are complicated, especially for savers.

My take: I've seen people in Japan keep cash in their homes because bank interest was literally 0.001%—not worth the paperwork. That's the kind of behavior that ZIRP can trigger.

Countries with 0% or Negative Interest Rates (The Full List)

Below is a table of countries (or monetary unions) that have implemented 0% or negative policy rates in the past decade. Keep in mind that rates change: as of writing, some have moved slightly positive but remain extremely low.

Country / UnionCentral Bank Policy Rate (Approx.)StatusKey Note
Japan-0.1% (on some reserves)Negative / near zeroPolicy rate kept at -0.1% since 2016; long-term bond yield target 0%
Switzerland-0.75%NegativeSNB has negative rates since 2015; sight deposit rate -0.75%
Eurozone0% (deposit facility 0%, main refinancing 0.05%)Near zeroDeposit facility was negative until 2024; now 0%
Denmark-0.35%NegativeCertificates of deposit rate negative since 2012 on and off
Sweden0% (repo rate)Near zeroRepo rate was negative from 2015–2019; now at 0% (as of last change)
Hungary0.6% (base rate)Low but positiveWas near zero during COVID; now slightly above

Notice I didn't include “developing economies” like Kenya or India—they have positive rates (often 5–10%). The zero-rate club is mostly wealthy countries fighting deflation.

Japan: The Pioneer of Zero Interest Rates

Japan is the poster child for ultra-low rates. The Bank of Japan (BOJ) introduced its zero interest rate policy back in 1999, after the asset bubble burst and deflation set in. Over two decades later, the policy rate sits at -0.1% for certain bank reserves, and the BOJ targets 10-year government bond yields at around 0% (they allow a band of ±0.5%).

How It Feels for a Regular Saver

I visited Tokyo last year and opened a savings account at a major bank just to see the horror. The annual interest rate on my savings account: 0.001%. On a $10,000 deposit, I'd earn 10 cents per year. Meanwhile, ATM fees could eat that up. Many Japanese households actually store cash at home—I heard stories of people buying home safes from Tokyu Hands. It's not paranoia; it's rational when bank rates are basically zero.

The BOJ's negative rate applies only to a portion of commercial bank reserves, not directly to consumer accounts. But the effect trickles down. Banks are reluctant to pass negative rates to customers (charging you for deposits) because they'd lose business. So they keep rates at zero or tiny positive. The result: savers get nothing, but borrowers benefit from ultra-cheap mortgages (around 0.5% fixed).

Switzerland: Negative Rates for Years

Switzerland's central bank (SNB) has the lowest policy rate in the world: -0.75% on sight deposits. They've kept it there since 2015, mainly to prevent the Swiss franc from appreciating too much (which hurts exporters). The negative rate means banks actually pay the SNB to hold their money. Banks pass some of that cost to large depositors (institutions, pension funds), but ordinary savers with balances below a certain threshold (e.g., 100,000 CHF) often escape the penalty. Still, interest on savings accounts is pitiful—often 0.01% or zero.

What I Learned from a Swiss Banker

A friend working at UBS told me that wealthy clients sometimes shift cash into gold or real estate just to avoid negative rates. For example, if you have 5 million CHF sitting idle, the bank might charge a safekeeping fee of 1%—that's effectively a -1% return. So people either invest (in stocks, bonds) or buy tangible assets. It's a forced migration out of cash.

Eurozone: Negative Rates Ended but Still Near Zero

The European Central Bank (ECB) pushed its deposit facility to -0.5% during 2019–2022 to boost inflation. Then in 2023–2024, they raised rates to fight inflation, bringing the deposit rate to 0% (as of mid-2024). So technically, the Eurozone is no longer negative, but 0% for deposits is still effectively zero. The main refinancing rate is 0.05%—basically zero.

Countries like Germany, France, Italy follow the ECB. If you have a savings account at a German bank, you'll get maybe 0.1% if you're lucky—or nothing. Mortgages, however, are still cheap: around 3–4% fixed, which is moderate historically.

Denmark and Sweden: Other Negative Rate Veterans

Denmark's central bank has used negative rates since 2012 to defend the krone's peg to the euro. The certificate of deposit rate is -0.35%. In practice, Danish banks rarely charge retail customers negative rates unless they have huge balances. The typical savings rate is around 0% to 0.2%.

Sweden's Riksbank experimented with negative rates (repo rate at -0.5% from 2015–2019) but ended them in 2020. As of now, the repo rate is 0%, so again near zero. Swedish banks offer savings accounts with 0.5%–1% interest, which is actually decent by European standards—but still low.

What 0% Interest Rates Mean for Your Savings

If you're looking to park money in a country with 0% rates, here's the practical reality: your cash will earn nothing, and you may even face fees. Key takeaways:

  • No growth: A 0% return means your purchasing power is eroded by inflation. In Japan, inflation has been near 0–2%, so real returns are negative.
  • Bank fees might eat your money: Some Swiss banks charge account fees that exceed any interest earned.
  • Negative rate protection: Most countries exempt small savers. But if you have large deposits, you could be charged.
  • Alternative assets: In zero-rate environments, people turn to stocks, real estate, or even crypto to get positive returns. But these come with risk.
Expert tip: If you're considering moving your savings to a zero-rate country to avoid currency risk or for other reasons, check the real return after inflation and fees. It might be better to keep money in a higher-rate country and hedge currency exposure instead.

FAQ: Common Questions About Zero Interest Rate Countries

1. Which country has 0% interest rates on savings accounts, not just central bank rates?
Savings account rates vary by bank. In Japan, the average savings rate is 0.001% (effectively 0%). In Switzerland, it's often 0.01% to 0.1%. In the Eurozone, many accounts yield 0% to 0.3%. So while the central bank rate may be near zero, consumer savings rates can be slightly higher but still negligible. I'd say Japan and Switzerland have the closest to 0% for the average saver.
2. Does a 0% interest rate mean a free loan from the bank?
Not exactly. If you get a mortgage in Japan with a 0.5% rate, yes, it's nearly free. But banks usually add a spread over the policy rate to cover risk and profit. In a zero-rate environment, mortgages can be as low as 0.3–1% in Japan. That's insanely cheap if you can lock it in. But watch out for fees and variable rates that can rise.
3. Can I open a bank account in a zero-rate country to avoid paying negative rates in my home country?
Possible but impractical. You'd need to be a resident in most cases, or at least have a valid reason (business, study). Even if you open an account, you'll face currency conversion fees if your income is in another currency. The net benefit is often zero or negative. I tried opening a Swiss account as a non-resident—most banks require a minimum deposit of 100,000 CHF and charge annual fees of $200–500. Not worth it.
4. Why don't people just take their money out of the bank in zero-rate countries?
They do! In Japan, cash hoarding is a thing. But for large sums, cash is insecure and inconvenient (insurance, storage). Also, for online transactions and salary deposits, you need a bank account. So many keep small amounts in banks and invest or hold physical cash for larger portions.
5. Will central banks ever raise rates above 0% in these countries?
Some already have (Eurozone, Sweden). Japan is the biggest outlier—the BOJ has hinted at normalizing but is cautious due to fragile growth and deflation memory. Switzerland's negative rate is tied to currency policy, so they might stay low for a while. My guess: Japan will remain near-zero for another few years, but nothing is certain.
This content is based on my personal research and conversations with financial professionals. Policy rates are verified against central bank websites (Bank of Japan, Swiss National Bank, ECB, etc.). Data is current as of the time of writing; always check official sources for the latest rates.