Hungary Baby Bonds attract 10,000 investors in two months
The savings scheme, which runs until the child comes of age, is increasingly popular thanks to its favourable conditions, Tállai said, adding that it allows parents, grandparents and other relatives to contribute to the subsequent financial security of the recipients.
The Hungarian government automatically grants all newborns HUF 42,500, including Hungarian children born abroad, but this amount only turns into a baby bond if a relative opens a Start account at the Hungarian State Treasury for the child. “The treasury invests every single forint paid into these Start accounts into baby bonds, and at a very good yield,” Tállai said. Interest for a given year is set at the previous year’s inflation plus a 3% premium. There is also a government subsidy on these savings, as the budget adds 10% of deposits made by relatives each year, capped at HUF 6,000.
People opening securities or Start accounts using the government’s electronic administrative portal before 30 June will enter a draw to win a HUF 100,000 coupon, while buying government securities using the same channel may win the investor HUF 50,000. Since the promotion was announced in April, more than 10,000 new accounts have been opened, Tállai said.
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