Scalable Capital vs Betterment
Scalable Capital is a European alternative to Betterment: same payments & finance use case, headquartered in Germany and governed by EU GDPR, while Betterment is based in the United States.
By the EU Alternatives team Last updated
Fully managed ETF portfolios with automatic rebalancing and a BaFin-regulated bank behind them, from 0.75% a year.
- Jurisdiction
- EU / EEA
- Primary privacy law
- EU GDPR
- US CLOUD Act exposure
- No
- Open source
- No
- Free tier
- No
Betterment automates diversified index portfolios with tax-loss harvesting and goal-based buckets that take real discipline to replicate by hand. The fee is 0.25 percent a year, or 5 dollars a month on smaller balances. For Europeans the question settles itself: Betterment LLC, a registered investment adviser based in New York, only accepts customers with a permanent US address.
- Jurisdiction
- US
- GDPR by default
- Requires DPA + TIA
- US CLOUD Act exposure
- Yes
Scalable Capital vs Betterment at a glance
| Scalable Capital | Betterment | |
|---|---|---|
| Headquarters | Germany | US |
| Data jurisdiction | EU / EEA | US law applies |
| Primary privacy law | EU GDPR | Requires DPA + transfer assessment |
| US CLOUD Act exposure | No | Yes |
| Open source | No | — |
| Free tier | No | — |
| Best for | Teams that need payments & finance built for European data-protection requirements | Teams already invested in the Betterment ecosystem |
Choose Scalable Capital if…
- You want a provider governed by a European privacy regime
- GDPR or public-sector data-protection requirements apply to you
- You'd rather back the European tech ecosystem
Stick with Betterment if…
- You depend on integrations only available in the Betterment ecosystem
- Your organisation has no EU data-residency constraints
- Migration costs outweigh the jurisdiction benefits for now
Why choose Scalable Capital over Betterment?
The decisive argument is data jurisdiction. Betterment is headquartered in US, which means personal data processed through it can be subject to non-EU legal regimes: the US CLOUD Act, FISA 702, or similar laws depending on the provider. After the 2020 Schrems II ruling, EU organisations must carry out a transfer impact assessment for every such data flow.
Scalable Capital removes that overhead. As a Germany-based provider, it operates natively under GDPR, and data stays inside the EU/EEA by default. For regulated sectors such as health, public administration, and finance, that's not a nice-to-have but a requirement. For everyone else, it's concentration-risk insurance: you avoid depending on a single non-EU jurisdiction that can change the rules without warning.