Clearing
Banks
There were once numerous different clearing banks. This has changed
considerably in recent years as many banks have merged or been bought
out by a larger bank. At present the two banking giants in Spain
are the BSCH (Banco de Santander y Central Hispano), which resulted
from the merger of the Santander, Central and Hispano banks, and
the BBVA (Banco Bilbao Vizcaya Argentaria), which is again the product
of two major banks including the originally state-owned Argentaria.
Other
important banks in Spain include the Banco
de Andalucía, Banco
Atlántico and Banco Zaragozano. Most large towns have at
least one branch of the main banks and in cities there are several
branches. Smaller towns usually have a very limited number of banks
(perhaps just one) and villages sometimes have none at all.
Foreign
Banks
There are
foreign banks that operate in Spain, although they tend to be concentrated
mainly in coastal resort areas and in the large cities. British
banking is represented by Barclays, the Royal Bank of Scotland (affiliated
to the Santander bank) and Solbank, owned by Banco Sabadel. The
American banks, Citibank and Chase Manhattan, are also present.
Other foreign banks include Deutsch Bank (which has an agreement
with the Spanish Post Office) and several Arab and Scandinavian
banks.
Savings
Banks
Savings banks (known as cajas de ahorro) are very common
in Spain and apart from the Catalan La Caixa and Caja Madrid that
are both present in most of the country, tend to be regional or
provincial. Savings banks also act as charitable institutions and
invest part of their profits in social and cultural associations.
In Andalucia the main savings banks are Caja Rural, Caja Mar, Caja
Sur and UniCaja (originally from Malaga province), La General (from
Granada), Caja San Fernando (from Cadiz) and El Monte (from Seville
and Cordoba). Savings banks, although popular, are considerably
less so than the clearing banks.
Internet
Banking
Internet
banking has taken off in a big way over recent years in Spain and
more and more Spaniards are now using online services. Practically
all banks offer Internet services and as long as you have a user
name and password you can carry out most banking transactions online.
Some banks even offer online credit facilities. Internet-only banks
operating in Spain include ING (part of the Nationale Nederlande
group), Patagon (linked to the BSCH group) and EvolveBank (a subsidiary
of Lloyds/ Chase Manhattan). Most Internet banks offer preferential
rates of interest for savings.
How
to Choose a Bank
The
number of banks in Spain can mean that it’s difficult to decide
which one to use and where to open an account. The following may
help you in your choice:
Location
Your
first consideration should be which banking institutions operate
in your locality. If your property is in or near a small town or
village then the choice may be very limited –perhaps even
to just one savings bank. If this is the case, you may decide to
widen your horizons to the nearest larger town, if only to have
a better choice. However, there’s a lot to be said for having
your bank as near as possible to where you live. Service in branches
in small localities is often much more personalised and the staff
less hurried or stressed out with the pressure of meeting monthly
objectives. On the other hand, small branches may not offer a choice
of banking services and they are less likely to have English-speaking
staff.
Bank
Charges
Spanish
bank charges are notoriously high and a large part of some banks’
profit margins are made thanks to the charges paid by clients for
just about every banking transaction imaginable. Charges are particularly
high for the payment of cheques into your account and for bank transfers.
Before you open an account, ask for a breakdown of all charges including
annual fees. If you plan to make a lot of bank transfers every year,
you should carefully consider how much this is going to cost you.
You may be able to negotiate more favourable terms if you agree
to maintain a minimum amount in your account or if you treat the
branch manager to at least a coffee in the local bar!
Bank
Transfers
If
you plan to keep most of your money outside Spain and to make transfers
periodically to your Spanish account, you should enquire about the
facilities a bank offers for this (e.g. once the money arrives in
your account, how long is it before you can use it) and what their
charges are.
Extra
services
Banks
sometimes offer a range of services such as insurance and investment
banking, which could be useful to you. Bear in mind, however, that
these services can be more expensive than those offered by specialised
companies and aren’t likely to be independent.
English-speaking
Staff
If
you’re not planning to learn to speak Spanish or feel that
Spanish banking language is beyond you, you may wish to base your
choice of bank on the availability of English-speaking staff. Banks
in resort areas and in large cities usually have at least one member
of staff who speaks English, although you shouldn’t count
on this. Banks in towns and villages in rural areas generally don’t
have English-speaking staff. When choosing a bank, it’s also
a good idea to ask friends and acquaintances for recommendations
(or otherwise) and if after a while, you find you’re not happy
with your bank, you can always open an account somewhere else!
Opening
an Account
Both
residents and non-residents can open a bank account in Spain. You
need to be over 18 and provide proof of identity such as a passport.
If you’re a resident you’ll need to provide your residence
card details. If you own property in Spain, the bank will probably
also require your NIE (número de identificación de
extranjeros), which all foreign property owners must have. You can
open the account in person or by postal application, although this
is probably only advisable as a last resort.
Type
of Accounts
Most
people open a current account or a savings account with their bank.
A current account in Spain is much the same as that in any country
and you’ll be issued with a cheque book and ATM/ debit card.
Note that cheques are generally not accepted as a form of payment
in shops and businesses. Debit and credit cards are. You receive
monthly statements regarding your account. Some banks pay nominal
rates of interest on current accounts, although by the time with-holding
tax at 25% has been deducted, you sometimes wonder why they bother.
Saving
Accounts
Saving
accounts are generally different from current accounts in that they
offer interest, although interest rates paid at present are very
low (marginally higher than current account rates). With savings
accounts you are issued with a cash book where all transactions
are recorded. In some banks, you can use the cash book to withdraw
money from cash machines. Savings accounts sometimes include the
option of a debit card, but you can’t have a cheque book.
Investment
Accounts
Long-term
savings accounts and investment accounts are also available, although
these generally have restrictions on the amount you can withdraw
or penalties for withdrawing funds before time. Interest rates vary,
although at present no standard savings accounts in Spain offer
a good rate of interest. The best rates are obtained from investment
account linked to stocks and shares, although there are associated
risks of loosing some or all of your investment.
ATMs
There
are numerous ATMs in Spain and you can even find them in larger
villages, although you shouldn’t count on this, especially
in rural Spain. Spanish ATMs are very sophisticated and start by
offering you a choice of language (usually English, French, German
or Spanish). Instructions are easy to follow and self-explanatory.
Three
ATM networks operate in Spain –4B (the most common), ServiRed
and 6000. You can generally use any ATM to access money from your
account, although if the ATM you use isn’t one linked to your
bank there may be a charge. Some banks allow you to make three withdrawals
a month from ‘foreign’ ATMs before they charge you.
Others are not so generous. Because of this, you may wish to consider
opening a bank account with the bank owning your nearest or most
convenient ATM.
As well as straight-forward cash withdrawals, some ATMs allow you
to carry out a wealth of other transactions including paying cash
into your account, consulting your balance or most recent movements,
renewing your mobile phone card or making theatre, cinema and sporting
events reservations.
Mortgages
The
mortgage market in Spain has opened up considerably in recent years
and now all banks generally offer mortgage facilities to both clients
and non-clients, although obviously clients receive more favourable
terms. In order to obtain a mortgage from a bank in Spain you must
be over 25 and have a fixed employment contract or have been self-employed
for at least 3 years. Residents can theoretically borrow up to 90%
of the value of the property, although the amount is usually nearer
70 or 80% and the actual amount lent will depend on your income.
Non-residents can usually only borrow up to 60% and 50% maximums
are also common. Note that not all banks will lend to non-residents.
Mortgages are available for up to 25 years, although 10 or 15-year
mortgages are the most common.
