EU aims to boost retail investment as savers hold €11T in cash and deposits

European households are sitting on roughly €11 trillion in cash and bank deposits. That’s about one-third of their total financial assets, parked in accounts earning returns that, in many cases, barely keep pace with inflation.

The effort, known as the Retail Investment Strategy, is a cornerstone of the EU’s broader Savings and Investments Union agenda. The goal is straightforward: get everyday savers to move money from low-yield deposits into capital markets, funding the kind of innovation and growth that Europe desperately needs to stay competitive globally.

The plan and its price tag

The European Commission has estimated that the EU’s additional annual investment needs fall somewhere between €750 billion and €800 billion. That’s a staggering gap, and one that government spending alone cannot fill.

The RIS package was designed to make that migration easier and safer. Its core pillars include enhanced investor protection, improved transparency around costs and value for money, simplified regulations for non-complex financial products, and a push for better financial literacy across the bloc.

There’s also a focus on addressing conflicts of interest through what regulators call inducement rules. In plain terms, that means making sure the people selling financial products to retail investors are actually acting in those investors’ best interests, not just chasing commissions.

Political agreement on the RIS package was reached by the Council and European Parliament on December 18, 2025. Member states gave their final approval on June 12, 2026.

Member states hit the brakes

At least five member states, with Germany among the most vocal, have been pushing to reduce the regulatory burdens embedded in the package. Some want to renegotiate aspects of the agreement entirely. The result is a familiar Brussels dynamic: consensus achieved, then slowly eroded by national interests.

The pushback has delayed the implementation timeline, injecting uncertainty into what was supposed to be a marquee achievement for EU financial integration.

Why the savings gap matters

American households, by comparison, allocate a significantly larger share of their wealth to equities and investment funds. That capital flow helps explain why US tech companies and startups have historically enjoyed deeper pools of funding than their European counterparts.

Despite a strong household savings rate in Europe of approximately 13–15% of income, there exists a notable preference for low-risk, liquid bank deposits over capital market investments. As a result, many EU businesses, particularly small and medium enterprises, struggle to secure the necessary funding to thrive and innovate.

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