Before opening an account in Spain you might have thought that banks worked similarly across the world. In some respects they do, but there are also many differences and these can cause confusion or worse. In this article we aim to unpick the practice.
Opening a bank account in Spain
If you have a property in Spain it is advisable to have a bank account. You need to pay your regular bills, taxes and, of course, a mortgage if you have one. Spanish bank accounts are available to both residents and non-residents and you will need to confirm your status with the bank when opening your account and at regular intervals afterwards. If you become a resident at a later date then it’s obligatory to change to a resident account. If you do this you can expect your account number to be different too.
The most popular banks in Spain are:
- Deutsche Bank
- La Caixa
However, there are others to choose from too and you might want to ask people you know who they bank with and how they’ve found the services on offer. People may also recommend a bank because of the personnel who work there. This can also be a good recommendation to follow but check that the bank’s services are also appropriate to your needs.
The things you need to change your bank account
If you are reading this article, then you probably already have a bank account in Spain. However, customers are becoming more demanding in what they expect from their bank, and rightly so. This might mean that you wish to change from the bank you originally chose, in which case you will need to show some documents, of course, and normally these are:
- A valid passport or national identity
- Your Spanish Tax identification number (NIE)
- A document to confirm your address such as a utility bill or Title Deed
- A document to prove you have an income – this could be a payslip, tax return or an official form connected to your pension
If you are non-resident the bank will require a ‘Certificado de No Residente’ which is a letter that confirms your non-resident status. Your bank will charge you for obtaining this on expensive (around €20 – €40), once every two years.
If you are a resident then you will more or less need the same paperwork but will also need to supply your Spanish Residencia permit. This number is required for many different transactions in Spain and you are well-advised to either memorise it or have it close to hand. If your bank is in a tourist area with many foreign residents then it is likely that the staff will speak English and offer other languages too.
If your bank is in a traditional Spanish town it is unlikely this will be the case. Taking someone with you who speaks Spanish on your first appointment is a good idea until you know what the language skills are in the bank you’ve chosen.
It’s a common complaint that banks seem to charge for almost everything in Spain. You are likely to find the following deducted from your account as a minimum:
- Maintenance fees – there is usually an average fee for having your bank account and this is anything from €40 year and upwards
- Transferring money – if you use your bank account to transfer money, even to another Spanish account, you may be charged. The transfer cost is usually around €2 or C3 for every transaction you make. Online transactions are usually free.
- ATM – if you use a cash machine that is not linked to the bank you use then you will be charged a fee. This varies but is likely to be at least €2.
- Credit and debit cards – some banks may charge a small fee per year for maintaining your card and can be around €8 and €10 per year.
These are the regular deductions that you can expect to see. Be aware that any additional activity is also likely to come with a charge.
As with banks in most countries, Spanish banks will be keen to sell you other products and services. Be clear before you go into your bank exactly what it is that you are asking for and be cautious about any other offer that is presented to you. This particularly relates to pensions and insurance.
The banks in Spain have been guilty in the past of urging their customers to buy into insurances. These may not be as good as those offered by specialist insurance providers such as Mapfre. You can politely take the paper work but let them know you will think about it. Insurance aside having an insurance policy and an account under one roof is not always for the best. Banks sometimes will not allow blocking or non payment and cancelling of an insurance of this type could be difficult.
Be cautious about taking on anything additional then and there.
Some more tips
- Do make sure that you are equipped with everything you need to carry out online banking. The number of actual banks has diminished and where they do exist there can be lengthy queues at particular times of the day. Many banks close at 2pm and are only open during the week although some do have one day on which they open later. Make sure you are clear about the opening times and that you choose a branch that you will be able to access.
- Spanish banking words – To start with, the Spanish word for banks is ‘bancos’. The word we most often associate with banks ‘caja’ actually stands for ‘cajas de ahorras’ or savings banks. Your account is ‘cuenta’ and a current account is la cuenta corriente. You might also need to know:
- Tarjeta = card
- Seguros = insurance
- Saldo Contable = account balance
- Saldo Disponible = balance available
- Traspasos = transfers
- Inicio = Start
- Extracto = statement
- Cuenta para residentes = resident account
- Cuenta para no residentes = non-resident account
- Your account details – You need to keep a note of your account details somewhere safe. There are lots of similarities with your UK account, but some differences too. It is likely that you will also need to know your bank’s BIC and IBAN for if you have to make a transaction across countries.
- Account number – usually a ten digit number
- Sort code – four digits for your bank reference and four digits for your branch
- Control number – a two digit number
- BIC – stands for the Bank Identifier Code. It begins with letters that refer to the bank you are using. For example BARCES for a Barclays branch in Spain. It is used in conjunction with the IBAN
- IBAN –this stands for ‘International Bank Account Number’ and is a standard way of identifying banks across different countries. It also starts with letters, for example: ES75 for a bank in Spain
- Differences with banks in Britain – Although in most cases the banks in Britain and in Spain work very similarly there are some notable differences.
- For example, in Spain you have up to 56 days to cancel a direct debit or other payment that has been made from your bank account. Even when the money appears to have been taken out, it is in fact ‘in limbo’ and you can ask the bank to return it to your account, free of charge.
- Banks will prioritise your payments if your account is short on funds. For example, if you have a mortgage payment to go out and a utilities bill at the same time but not enough funds to cover them both, they’ll most likely pay your mortgage first.
- Banks and different authorities do ‘talk’. You’re probably aware already that bank accounts can be frozen or ‘embargoed’ if a tax bill remains unpaid. It’s not just Spanish banks that the Tax Authority has ‘relations’ with. We are seeing cases where queries about interest earned on savings in the UK are being taken up with UK banks by the Spanish Tax Authority. Information is being shared not just between organisations in Spain but across countries too.
- If you do apply for a credit card from your bank check what the arrangements are for paying it off. Credit cards are less easy to come by than in the UK and methods of payment can also be different. For example, you might be billed for the full amount owing on some cards at the beginning of the month. In other cases you have to place the money in a separate account as a kind of financial guarantee of payment.
Banking has become simpler and banks are now more closely regulated than they were. Following this advice and our few tips your bank can be an asset rather than a liability when it comes to enjoying your property in Spain.