Americans in Italy: The best Italian banks and why fewer Americans are renouncing citizenship

Welcome to our regular look at everything you need to know about life in Italy for The Local’s readers from the US. This newsletter is published monthly and you can receive it directly to your inbox before we publish by going to newsletter preferences in ‘My Account’ or following the instructions in the newsletter box below.

Some 3,260 Americans formally gave up their citizenships last year, according to the US government's Federal Register website - a choice many of those living abroad make for tax reasons.

That's actually a slight drop on 2022 figures, thought to be caused by increasing numbers of US citizens waiting until the government reduces its renunciation fee.

Following a 2020 legal challenge, the State Department announced last January it would bring down the charge for renouncing US citizenship from $2,350 to $450 - but hasn't provided any updates since October.

“I find the length of time it’s taking them to enact the reduction in the fee, given that they announced it more than a year ago, deplorable,” said Liz Zitzow, a US national living in London.

Why are fewer American nationals renouncing their US citizenship?

If you move to Italy as an American, opening a bank account will be one of the very first things you’ll have to do, as you'll struggle to pay bills and taxes or take out insurance with an overseas account (especially one outside the eurozone).

But a lack of online information in English and a confusing array of account options (with differing fees) means the choice can be a little overwhelming.

To give you a head start, we asked readers to share their advice on which bank to choose.

Intesa Sanpaolo was the top recommendation for traditional Italian banks: Laura, a US-Italian citizen living in Ascoli Piceno, Marche, praised Intesa Sanpaolo for their customer service, saying staff were “patient and understanding” following a bad experience with another bank.

Meanwhile Wise (formerly TransferWise) was by far the most highly recommended online-only bank, with one reader in Tuscany praising its “speedy transfers, good exchange rates, and prompt problem resolution”.

The verdict: What are the best banks for foreigners in Italy?

Another popular digital banking option is the N26, though you may have heard rumours that the Berlin-based bank is having problems in Italy, or perhaps withdrawing from the country altogether.

Several readers have recently reported issues with N26 accounts registered in Italy. One told us his account was "closed for no reason. And the bank is not giving me my money."

Though N26 is still active in Italy, readers were concerned after reading that the bank was placed under a “special order” by Italy's central bank in March 2022.

N26 later said via a LinkedIn statement that a number of accounts were "wrongly closed" as the company was “developing, testing and calibrating” new measures to prevent financial crime.

So what exactly is going on and is it still an option for Italian residents? We looked at the issues in the below article:

Has digital bank N26 closed down in Italy?

Have your say: If you'd like to share your opinion or tell us about an experience you've had while living in Italy, please leave a comment below this article or get in touch by email.

And if you have any advice for other American readers who are considering moving to Italy, or questions of your own, you can add them to our ongoing survey here.

Thanks for reading and please get in touch with us by email if you have any feedback on this newsletter.