About Netherlands

The Netherlands has an open economy which relies heavily on foreign trade; it is characterised by low unemployment and low inflation. The Netherlands is also an important European transport hub with some of the biggest airports and ports on the continent.

The Netherlands has excellent ICT connectivity, a skilled English-speaking workforce and a favourable business climate. All of these factors, in addition to its strong domestic market and access to the rest of the EU, contribute to the Netherlands being an attractive investment destination. The Dutch government strongly supports foreign businesses through The Netherlands Foreign Investment Agency (NFIA), which offers advisory services to businesses at every stage of their operations in the country.

Furthermore, the Dutch government has signed tax treaties with more than 100 countries, enabling investors from those countries to avoid double taxation on prescribed types of income subject to complying with the relevant rules.

The Netherlands has a large and interconnected financial system, and it is home to a number of globally significant banks and insurers. The banking system is dominated by three domestic banks.

China-Netherlands trade has been increasing over the past few years, and the Netherlands is now China's second largest trading partner in the EU.

Netherlands Market Profile Infographic_Small

What solutions are available in Netherlands?

Solution Description
Treasury Centres A centralised treasury is one way to reduce the tax burden, centralise risk management, improve liquidity and enhance yield on cash.
Interest Optimisation Maximise your interest yield from for your balances held with the bank.
Notional Pooling Cash balances in different accounts are notionally offset to derive the net balance, which is then used to calculate interest.
Sweeping/ Zero Balance Account (ZBA) ZBA are checking accounts with zero balances where funds are physically swept to eliminate excess balances and maintain greater control over disbursements.
Intercompany loans Similar to bank loans, intercompany loans refer to lending between entities within the same group.

Corporate Treasury in the Netherlands

The Netherlands is ranked as the fourth most competitive economy in the world and was one of the founding members of the European Union. Here, we highlight some of the key benefits relevant to treasury and cash management in the Netherlands.


Financial Market Development

  • The World Economic Forum ranks the Netherlands 17th in the world for its financial system in The Global Competitiveness Report 2019.
  • The report ranked the Netherlands fourth in the world for the overall competitiveness of its economy, and 18th in the world for the soundness of its banks. It was rated 13th for capitalisation as a percentage of GDP and 14th for both venture capital availability and financing of SMEs.
  • The Netherlands has an excellent business infrastructure, a highly-educated and multilingual workforce and a sound legal environment.
  • There are no foreign-exchange controls in the Netherlands.


Sophistication of Banking Systems

  • There are more than 40 domestic banks in the Netherlands, and over 50 branches of foreign banks, with the sector dominated by the three largest domestic banks.
  • The Netherlands' foreign-exchange market has an average daily turnover of USD64 billion (Bank for International Settlements Triennial Central Bank Survey 2019).
  • The Netherlands has a well-developed debt market with both government and corporate bonds available. Outstanding debt securities totalled USD2,188 billion at the end of the first quarter of 2020.


Regulatory Bodies

  • The banking industry is regulated by the Bank of the Netherlands and the Netherlands Authority for the Financial Markets. As a eurozone country, it is also covered by the Single Supervisory Mechanism.



  • The corporate income tax rate is 16.5% on the first EUR200,000 of taxable income and 25% on taxable income above this amount. These rates will be reduced to 15% and 21.7%, respectively in 2021.
  • Resident companies are subject to tax on their worldwide income, although certain income can be exempted. Non-resident companies are taxed on Dutch-sourced income. There is no branch profits remittance tax on the remittance of profits to the head office by the branch of a foreign company.
  • The standard rate for Value Added Tax (VAT) is 21%, with certain goods and services qualifying for rates of 0% or 9%, while others are VAT-exempt.
  • Interest income is taxed as ordinary income. Interest expenses are usually tax deductible, although the deduction of interest for intra-group loans is not allowed in certain circumstances under anti-abuse rules. There are no thin capitalisation rules in the Netherlands.
  • There are no stamp duties in the Netherlands.
  • The Netherlands does not levy capital gains tax on capital transactions.
  • There are no withholding taxes on interest. For resident companies, withholding tax (WHT) of 0% or 15% is charged on dividends. For non-resident companies from countries where there is no tax treaty, WHT on dividends is 15%. Where a treaty is in place and the non-resident can provide a Certificate of Residence, WHT on dividends ranges from 0% to 15%.
  • The Netherlands has tax treaties with more than 100 countries and territories.
  • The Netherlands is a signatory to the Organisation for Economic Co-operation and Development’s Multilateral Competent Authority Agreement, through which information is exchanged between tax administrations, to provide a single, global picture on some key indicators of economic activity within multinational enterprises.


Benefits for Regional Treasury Centres

  • The Netherlands has many tax incentives for foreign-owned companies and a favourable business environment for treasury centres.
  • The Netherlands has more than 100 tax treaties, one of the most extensive tax treaty networks in the world.
  • The Netherlands is a eurozone country with trading hours that overlap with Asia, Europe and North America.
  • Notional pooling and cash concentration are permitted between resident and non-resident accounts. Cross-currency pooling is also available.
  • The Netherlands is an established global and regional cash pool centre due to its extensive tax treaty network, advance pricing agreement opportunities and limited withholding tax system.
  • The Netherlands has a liberal regulatory regime and a sophisticated cash-management culture.
  • Offshore tax opportunities are available in the Dutch Caribbean islands of Bonaire, Saba and St Eustatius, collectively known as the BES islands, which were categorised as special Dutch municipalities from 10 October 2010 onwards and have their own tax codes (i.e. real estate tax and revenue tax). It should be noted that should a company not meet the residency requirements under BES island tax codes, then the tax laws of Netherlands shall apply to the said company.




Banking System

  • There are 43 domestic banks in the Netherlands, with the sector dominated by the three largest banks. More than 51 foreign banks have branches in the Netherlands. The last few years have seen a slow contraction in the number of banks, due to either mergers or closures.
  • The banking sector makes up a large proportion of GDP and is dominated by three large domestic banks: ABN Amro, Rabobank and ING Bank. Together, they are responsible for 78.5% of total banking assets, with about 5% held by the next seven largest banks. The state has a majority stake (56%) in ABN Amro while Rabobank is a cooperative.
  • • The Netherlands has one of the most concentrated banking sectors in the eurozone. Foreign banks have a very limited role domestically.
  • The Netherlands operates a universal banking system, which does not distinguish between retail and investment banking.


Bank Accounts

  • Residents may hold foreign-exchange and domestic-currency accounts both domestically and overseas. Domestic-currency accounts are freely convertible to foreign currency.
  • Non-residents may hold foreign-exchange and domestic-currency accounts, and domestic-currency accounts may be held overseas and are freely convertible to foreign currency.
  • Interest is available on current and demand deposit accounts.


Legal and Regulatory

  • The Netherlands' central bank, De Nederlandsche Bank (Bank of the Netherlands or DNB), is a member of the European System of Central Banks (ESCB).
  • The European Central Bank (ECB) supervises banks within the eurozone that are regarded as 'significant' through the Single Supervisory Mechanism (SSM) and other 'less significant' banks are supervised by the national central bank, such as the DNB.
  • The Netherlands Authority for the Financial Markets supervises transactions between financial institutions and clients.
  • A company is resident if it is incorporated in the Netherlands or is managed or controlled in the Netherlands.
  • The Netherland's has anti-money-laundering and counterterrorism-financing legislation in place, and follows European Union (EU) anti-money laundering directives.
  • Foreign-exchange controls are not applied in the Netherlands.
  • The Netherlands has set up a financial intelligence unit, the FIU-Netherlands, which is a member of the Egmont Group.



On 13 January 2018, the revised Payment Services Directive (PSD2) became law across all EU Member States. A revision of the initial PSD adopted in 2007, PSD2 updates and enhances the legal framework for payment systems across the European Economic Area (EEA) single market, to be supervised by the European Banking Authority. Supplemental regulatory technical standards are also being rolled out, from March 2018 to September 2019, to address issues of authentication, monitoring and API (application programming interface) standardisation.

The main objective of PSD2 is to provide enhanced consumer security in the developing financial technology (fintech) environment i.e. for electronic payments such as mobile payments, credit transfers, online payments and direct debits.

Measures include:

  • Prohibition of surcharges on credit/debit card payments.
  • Imposition of strict security requirements including the protection of financial data.
  • Increased competition between European payment service providers.
  • Greater consumer rights such as ‘no questions asked’ refunds on direct debits in euros.


Payment Systems

equensWorldline CSS

(Clearing and Settlement System)

Multilateral net settlement system

  • Processes low-value, non-urgent and bulk EUR-denominated retail payments (there is no value threshold).
  • 25 direct participants.
  • Linked to selected European payment and clearing systems and the US Federal Reserve for cross-border, multi-currency clearing.
  • Settlement of payments for participants of the equensWorldline CSS are done by equensWorldline participant payment centres.
  • Settlement of payments for participants of equensWorldline CSS linked to the CSS is done via the European Automated Clearing House Association (EACHA).
  • Payments for any other banks are done through the Euro Banking Authority (EBA) as a STEP2 participant.
  • The European Clearing Cooperative (ECC) handles all payment and clearing systems within the EU.
  • Final settlement is done through TARGET2.
  • Paper-based payments are truncated prior to being processed.


Pan-European net settlement system

  • Operated by EBA Clearing.
  • Processes low-value (no minimum value threshold) and non-urgent Euro-denominated commercial payments.
  • STEP1 is open to all banks in the EU and has access to EURO1 platform.
  • Operates SWIFT messaging.



Pan-European Automated Clearing House (ACH)

  • Operated by EBA Clearing.
  • Processes low-value, non-urgent and bulk Euro-denominated retail payments.
  • Provides straight-through processing for interbank transactions.
  • Settlement done same or next day, depending on time of submission.
  • A pan-European real-time infrastructure for EUR-denominated transactions is under development by EBA Clearing and Italy's SIA Group (one of the operators of STEP2).
  • Cross-border transactions can be processed through SWIFT and overseas correspondent banks.


Single Euro Payments Area

Pan-European payment infrastructure

  • Initiated by the European Payments Council (EPC).
  • Operates a common set of payment instruments, infrastructures, procedures and standards for euro transactions within Europe.
  • Electronic retail payments within SEPA are regarded as domestic payments.
  • SEPA is not applicable to urgent, high-priority payments or cheques.
  • SEPA countries include 28 European Union (EU) member states and four European Free Trade Association member states (Iceland, Liechtenstein, Norway and Switzerland).
  • A Europe-wide legal framework for payments, PSD2, was launched in 2016, which essentially provides security for electronic payments inside and outside of the EEA.
  • There are two SEPA payment instruments: SCT Inst and SDD (see below).

SCT Inst

SEPA Instant Credit Transfers
Pan-European instant payments system
  • Operated by the EPC.
  • 585 participants.
  • Launched in November 2017, this scheme provides EUR-denominated credit transfers up to a maximum of EUR15,000 within ten seconds. Available 24/7, year-round.
  • Currently there are eight participating countries: Austria, Estonia, Germany, Italy, Latvia, Lithuania, the Netherlands and Spain. The network will progressively cover all 34 European countries with access to SEPA.
  • Corresponding national systems were phased out in 2016.


SEPA Direct Debits
Pan-European direct debit system
  • Operated by the EPC.
  • 585 participants.
  • There are two types of SDD: SDD Core for consumers and SDD B2B for businesses.
  • Operates whereby the payer has to give approval via a mandate provided by the biller electronically or on paper. Otherwise known as creditor-driven mandate flow.
  • Corresponding national systems were phased out in 2016.
RT1 Pan-European real-time EUR credit transfer system
  • Operated by EBA Clearing, which also operates EURO1, STEP1, STEP2 and Italy's SIA Group (one of the STEP2 operators).
  • Launched in 2017.
  • 28 participants.
  • A pan-European real-time infrastructure for EUR-denominated SEPA transactions.
  • Supports transactions compliant with SCT Inst scheme.
  • Messaging is in line with ISO 20022 or SWIFT FIN standard.
EURO1 Pan-European RTGS-equivalent net settlement system
  • Operated by EBA Clearing.
  • Processes high-value (no maximum value threshold) and urgent Euro-denominated domestic and cross-border payments.
  • Payments processed with immediate finality and are irrevocable.
  • Operates SWIFT messaging



Payment Instruments


Credit Transfers

  • Credit transfers can be paper-based or automated, and electronic transactions currently make up about a third of all cashless transactions.
  • Used for payroll, supplier and third-party payments and government transfers.
  • The European Credit Transfer (Europese Overschrijving) is based on SCT Inst.
  • High-value and urgent electronic transactions are settled through TARGET2-NL in real time.
  • Low-value and non-urgent SEPA transactions are processed through equensWorldline, and can be done same day or next day through STEP2.
  • TNS (Telegiro Nieuwe Stijl) payments cater for low-value and urgent credit transfers, settled within 1.5 hours between participating (33) banks.
  • IBAN Acceptgiros are paper-based or electronic transactions (more than three-quarters are done online), however, their usage is in decline as SEPA payments become more common. They will be phased out by 1 January 2019.
  • TIPS (TARGET Instant Payment Settlement) pilot, launched in early 2019, processes credit transfers in five seconds with 24/7, year-round availability.
  • Credit transfers in the Netherlands accounted for 30.17% and 97.9% of cashless payment volume and value in 2019.


Direct Debits (auto debits)

  • Used for low-value transactions and most regular payments such as utility bills. It is a widely used form of payment in the Netherlands and places the country third for direct debit usage in Europe.
  • SEPA direct debits provide same day or next day (through equensWorldline CSS) payments.
  • In 2019, 15.6% and 1.4% of cashless payment volume and value were through direct debits.


Card Payments

  • Cards, especially debit cards, are the most common form of cashless payment for retail transactions. Debit card usage has exceeded cash since 2015.
  • For cashless payments in 2019, cards account for 54.2% of transaction volume but only 0.8% of transaction value.
  • The main card brands in use are Visa and MasterCard, with American Express and Diners Club also well-established. They are all SEPA and Europay, MasterCard and Visa (EMV)-compliant.
  • Almost all card payments are processed through equensWorldline CSS, with Visa and MasterCard also cleared through their international card schemes.
  • By the end of 2019, 69% of all card transactions were made by contactless cards. 10% of these contactless payments were made with smartphone and wearables by December 2019.


Online Payments

  • With its mature and active financial industry and a sophisticated information and communications technology (ICT) sector, the Netherlands is well positioned to develop its financial technology (fintech) industry, which is still in a relative early stage of development.
  • The government has yet to develop a specific regulatory framework for fintech, but the digitization of the economy is high on its agenda and it has launched business initiatives for startups. The DNB and AFM established ‘The Innovation Hub’ to support technology and to assist fintech companies and startups on the regulatory and supervisory aspects regarding financial services and products.
  • The EU launched an ‘action plan on Fintech’ in 2018 that broadly sets out its approach, to be rolled out in due course. The areas of focus are: to encourage innovative business models; to support technological development in blockchain, artificial intelligence and cloud services; and to increase cybersecurity and protect the integrity of the financial system.
  • Banks and the retail industry are committed to digitizing payments, and organisations from the two sectors have drawn up a covenant to become 60% cashless by 2018.
  • Electronic payments make up more than 50% of total transactions, more than the EU average of 46%. Smartphone and contactless payments make up a large part of transactions.
  • This is largely due to the development and launch in 2005 of an advanced payment system, IDeal, by the three major banks, Rabobank, ING and ABN Amro. It had a fast uptake and is now the dominant payment method in the Netherlands, with 57% market share of online payments (2018). Other popular digital wallets are PayPal and Afterpay.
  • The e-commerce market is worth EUR22.5 billion, 20% of which is mobile commerce. Bank transfers dominate online payment methods, making up 60% of total e-commerce transactions.
  • 35% of e-commerce shoppers in 2018 made purchases using a smartphone.
  • MasterPass is a digital wallet scheme operated by MasterCard Netherlands. It is an e-money payment service that can be used online or via mobile and is processed through equensWorldline CSS. MasterPass can be used by holders of MasterCard, Maestro, American Express and Visa.
  • Mobile banking apps have been widely adopted, both bank and non-bank apps. Six Dutch banks have launched a mobile payment system, Payconiq, which was initially for use on Rabobank and ING banking apps, but is due to be rolled out on other apps. Bunq is a popular non-bank mobile banking app.
  • Approximately 90% of Dutch bank customers access banking services through mobile devices or internet banking.


Digital Currencies

  • The Netherlands’ established blockchain and cryptocurrency industry receives government and industry support in terms of research, startups, innovation and investment. Two of the main developments to come out of this partnership are the National Blockchain Agenda and the Dutch Blockchain Coalition.
  • The EU’s overall view of bitcoin is that “no member state can introduce its own currency”. Cryptocurrency exchanges are legal, depending on the country, and should be operated under the Anti-Money Laundering Directive, according to the European Commission.


Cash, Cheques and Money Orders

  • According to the European central bank, the Dutch are the least likely of all European eurozone citizens to use cash. Cashless payments now outstrip cash, which makes the Netherlands unique in the eurozone.
  • Banks stopped issuing cheques in 2001, and their use was phased out within the year.
  • Money orders are available from most banks as well as the major remittance providers such as Western Union.



Netherlands Market Profile Diagram

1 (Main) reduced and zero-rated VAT for certain goods and services

2 (Progressive) max rate on profits above EUR200,000

3 (Progressive) max rate on incomes over EUR68,507



This Market Profile is brought to you by DBS. Get in touch with us for further insights on doing treasury in the Netherlands and take advantage of our innovative solutions to empower your business. Click here to find out more.



Sources: IMF, World Economic Forum, PwC, Bank for International Settlements, the Bank of the Netherlands, Foreign Bankers’ Association, OECD, DBS, Association for Finance Professionals, DNB, Dutch Payments Association (Betaalvereniging Nederland), Ecommerce News Europe.

The information herein is published by DBS Bank Ltd. (“DBS Bank”) and is for information only. The information is assembled based on information available and accurate as at Dec 2019.

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The information herein may be incomplete or condensed. Any terms, conditions and opinions contained herein may have been obtained from various sources and neither DBS Bank, its subsidiaries/affiliates nor any of their respective directors or employees (collectively the “DBS Group”) make any warranty, expressed or implied, as to its accuracy or completeness and thus assume no responsibility of it. The information herein may be subject to further revision, verification and updating and DBS Group undertakes no responsibility thereof.

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