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Managing Money in Spain

Opening a Spanish bank account

It's easy to open a bank account in Spain, and there are many banks to choose from: Santander, La Caixa, Catalunya Caixa, BBVA, Banesto, etc. However, most of the banks that I visited didn’t have anyone who spoke English, although I originally managed to open an account with my basic Spanish at Catalunya Caixa .

To open a non-resident’s account all you need is your passport, or your NIE and photo ID. If you are a resident you can open a resident’s account and you will need your resident's permit (la tarjeta de residencia).

I recommend that you open a bank account on one of your visits to Spain before you move. Then you can transfer money in advance of your arrival and most rental contracts require your bank account to be mentioned, so it's good to have this set up.

When opening a Spanish account, you will be asked for your address in Spain and a contact telephone number. My original choice was Catalunya Caixa, it seemed most appropriate for living in Barcelona. However, I found Catalunya Caixa expensive to use and with a high annual fee for their credit card. Many transactions had to be done by visiting the local branch which usually meant standing in long queues, so I eventually closed this account and moved to ING Direct.

I've learnt that the Caixas (a Catalan word – Cajas in Spanish) tend to be expensive and that the Bancos are more reasonable.

Now that PIN numbers have been introduced with credit cards here, you are seldom asked to show a photo ID (passport or driving licence) when you make a purchase with a credit card, but occasionally you are still asked to do so.

Ing Direct – Free Spanish Banking Online

If you speak Spanish, my recommendation is to open an account with ING Direct – you can do this very easily online if you know some basic Spanish (there is no English language version of their Spanish banking website). ING Direct have no bank charges, and you can do all your money transactions and view balances etc. online - www.ingdirect.es. They also have a 24 hour help line (Spanish only) which offers a great service.

They have two main options, a cuenta naranja which is a current account but needs to be connected to an existing account at another bank in Spain. You can open this very easily online and transfer money between the two accounts and therefore do any transactions needed online from the cuenta naranja, thus avoiding queues and charges in local branches of a regular bank or Caixa.

The second option is a cuenta nómina, which is an independent current account, however this can only be set up and used if you pay your salary into the account (nómina means wage). I have both accounts and am very happy with ING Direct.

I see that ING Direct have recently opened another account called Cuenta Sin Nómina, aimed at self-employed people.

Lloyds Bank International – Virtually Free Banking in Spain in English

Lloyds Bank took over Halifax in 2010, so what was Banco Halifax Hispania is now Lloyds Bank International. The bank branch in Barcelona (from 3rd December 2012) is Avinguda Diagonal, 550.

Lloyds Bank International used to offers customers a very good deal for free banking in Spain in English, but this has changed recently. Their current account with free banking (except for an annual charge) is now only available if you first open a Premier Account. (Existing customers still get the free banking with an annual charge.)

The Premier Account requires a minimum monthly balance of at least €2,500 in order to obtain free banking. If you can afford to have this minimum balance then it's worth using. It's available to residents and non-residents.

All banking services in English

One of the best features is that Lloyds Bank International have English speaking staff in their branches, including Barcelona; there is a free online service in English and they have telephone banking in English too. This used to be available 24 hours but this has been reduced to banking hours.

How to open a Lloyds Bank International Account

If you're not already a Lloyds customer you need to go to the nearest Lloyds bank to you in Spain (there is a branch locator on the Lloyds International website). The branch in Barcelona is on Avinguda Diagonal, 550.

The only problem with Lloyds Bank International is that you have to open the account in person, and you have to show quite a lot of paperwork to open an account. For example to open a resident's account you have to show your passport, residents card, proof of address (a utility bill or rental contract) and proof of income, such as a payslip, tax certificate.

More info on how to open an account can be found at the Lloyds International website:
www.lloydsbankinternational.es

Residents Account and Non-residents Account

To open a non-residents account you need to show your passport and complete a Non-residence Declaration Form. To open a resident's account you need to show your certificate of residency. The difference between the two accounts is mainly for tax purposes, and if you have applied for residency in Spain you should open a residents account.

Contact Lloyds Bank International

Lloyds Customer Service: Tel: +34 91 484 81 81
Lloyds Telephone Banking: Tel: +34 91 484 81 87

There is only one branch in Barcelona, and there are people there who speak English:
Avinguda Diagonal, 550.

Winter timetable (from 16 September to 14 June) 
Monday to Thursday from 08:00h to18:00h. Friday from 08:30h to 15:00h

Summer timetable (from 15 of June to 15 September) 
Monday to Friday from 08:00h to 15:00h 

www.lloydsbankinternational.es

Spain Solutions Current Account from Barclays

Barclays also offers a current account, which now seems a better deal that than Lloyds Bank International because there is no minimum balance. Barclays' Spain Solutions Current Account gives free banking with a quarterly charge of €20. They have over 600 branches in Spain with an English-speaking person in many of them, and their online banking is also available in English 24 hours a day.

You have free reception of transfers from EU countries of less than €50,000. With recent changes in the banking laws in the UK it's more difficult to make free transfers even between the same banking groups, so you're more likely to be charged at source for international transfers when transferring from the UK.

The Spain Solutions Current Account comes with a debit card, cheque book and free tax and financial advice. Barclays also has a set of member services such as Home Assistance, translation, and discounts.

To open an account in Spain, go into any of the Barclays branches and complete an application form – the Barclays website has a branch finder, so you can easily find the nearest branch to you. This is what you need to open an account:

• Valid passport, Spanish National Identity Card or Residency Permit.
• Proof of address (e.g. utility bill, council tax bill or rental contract) issued within last 3 months.
• Proof of occupation confirming the professional status of each applicant. Acceptable documents include, for example: employee payslip, confirmation of pension/disability payment, student card, signed statement from a Chartered Accountant or lawyer. If you don't work or are unable to prove your status (e.g. housewife) a letter of confirmation signed by you will be required.

www.barclays.es

Moving Money to Spain

Moving money directly from your bank account to a Spanish bank account can incur large fees. You will be charged a commission on the exchange rate of Pounds Sterling to Euros, and also an administration charge, which can be very hefty – anything from £25 to £45 pounds and upwards.

See Lloyds Bank International (above). If you have a Lloyds UK bank account and open an account with Lloyds Bank International in Spain, you can make free transfers between the two banks.

Money transfer companies

There are several companies who will transfer money internationally for a smaller administration fee (see right-hand column for a list). You have to register first – if you are in the UK this is much easier, so best to do it before you leave.

These companies charge a lower fee, but sometimes don't give such a good exchange rate, so obtain a few quotes before making a choice. Some companies will only move large amounts of money, but if you are moving money on a regular basis, point this out as they will probably want to do business with you.

FC Exchange are based in London with other offices worldwide, and they offer a range of foreign currency exchange options to suit your individual needs.

I have an account with Cahoot (Santander), and have moved money directly from Cahoot to my account in Spain and I was charged £25 per transaction. This compares to £27 that I was charged by a money transfer company. The process was also quicker from Cahoot as the money went direct from one account to another. With the money transfer companies, your money goes from your account, to their account and then to Spain (although the process is usually quite quick). Cahoot did tell me that my Spanish bank may charge me for the transfer but this didn't happen.

PayPal

This is one of the cheapest ways to move money. By using PayPal you can transfer money to anyone with an email address.

You can't send money to yourself, so you need a trusted partner or friend to set up a PayPal account linked with a Spanish credit card or bank account.

Pay money into your PayPal account using a bank account or credit card; send the money to your friend's PayPal account, who can then transfer it into their connected bank account in Spain, or simply leave it in your Paypal account and use it when needed by paying directly for items using PayPal.

PayPal's fees are very reasonable and you can view them online at: www.paypal.com. If you prefer to set up a Spanish PayPal account visit www.paypal.com/es.

How to Avoid Credit Card Commissions & Money Withdrawal Charges When Aboard

My Travel Cash – Prepaid Commission-free Mastercard

My Travel Cash give you a pre-paid Mastercard which can be used just like any other credit card, but without the charges for using it overseas, when paying in different currencies and when withdrawing money from a cash machine. At the moment it's available to UK residents.

You can buy a prepaid card in either Euros, US Dollars or buy a multi-currency card. Simply choose the amount you want to prepay, and order your card before you travel. The My Travel Cash website gives you exchange rates when you purchase currencies so you can check that you're getting a good exchange rate.

There is no credit application or check because you are prepaying, the Mastercard is chip and pin protected, and there is a dedicated Lost & Stolen phone line.

There is no commission or any other charges and if you buy online you get a discount internet exchange rate which can save you about £30 for every £500 exchanged.

A sensible and secure solution to avoiding credit card fees and exchange commissions when travelling abroad.

Visit the My Travel Cash website.

Halifax Clarity

The Halifax Clarity has 0% exchange rate fee worldwide and there are no charges for cash withdrawals, but you will be charged interest on the cash withdrawals even if they are repaid in full. The interest charged is reasonable though, and still makes this card the best on the market to use outside the UK for UK residents. Don't use it in the UK – use it as your travel card – and repay in full every month.

Halifax Reward account holders currently get £5 a month if they spend over £300 per month, if they apply for the Clarity card.

www.halifax.co.uk/creditcards/low-rate-no-fee/clarity-card/

UK Santander Zero Credit Card

I used to recommend the UK Santander Zero Credit Card, but as it's no longer accepting new applications I now recommend the Halifax Clarity (see above). However, if you have a Santander Zero card it's still worth using as it has no exchange rate fees and no cash withdrawal fees.