Cheque (sic) your Spanish bank account

Banks are lobbing charges on current accounts without warning customers. Some customers now pay 240 euros a year just to have an account. The Crazy Guy investigates.

The biggest high-street names in Spain have tightened their special conditions for clients who want free banking.

Some banks are charging their customers up to 240 euros a year - in other words 20 euros a month - just for having an account with them. The commissions for the most basic financial services keep going up and the conditions demanded by some banks to exempt their clients from these charges are increasingly severe.

This is the way the banking sector has decided to increase its own income in a scenario of negative interest rates.

In the first six months of this year all the big banks increased their earnings from commissions, as they themselves reveal in their results. The five biggest banks in the country alone earned more than 10 billion euros just through charges and commissions.

In the case of Málaga-based Unicaja Banco (which is the fifth biggest in the country after its merger with Liberbank), between January and June this year it earned 10.6 per cent more from commissions than in the same period last year.

This increased income from commissions is not coincidental, but the result of an active policy of charging more and imposing conditions which are difficult to meet.

There is a double objective to this policy: they want to encourage more of their most loyal customers to contract financial products such as insurance, pension plans and investment funds, and they want to earn more from customers who merely have an account with them.

Numerous complaints

This strategy of increasing commissions and making it harder for clients to be exempt from them has resulted in increased conflict between the banks and consumers.

According to Banco de Espana, the number of complaints from customers about current accounts rose last year by nearly 50 per cent to 4,153. Most of the complaints were about the higher charges, where the number almost doubled, to 2,134. Complaints about bank commissions now account for ten per cent of the total.

Let’s look at some examples of what banks are now charging:

At the end of last year the leading Spanish bank, Santander, began to charge 240 euros a year instead of 144 (in other words, 66.7 per cent more), just for maintaining its One account. That charge applies to clients who do not fulfil the requirements for exemption: having a salary or pension of at least 600 euros a month paid into their account, three direct debits every three months and paying with a card six times in three months. If a client does not fulfil any of those three requirements, they will pay 240 euros a year. If they only fulfil the first one, they will pay 120 euros and if they fulfil the first one and one of the others they won't pay any account maintenance charges at all.

CaixaBank is the other bank at the top of the list of maintenance charges for account holders. Since October 2020 it has been charging 240 euros a year. If customers don't want to pay charges, they have to fulfil several requirements: pay a salary of at least 600 euros a month or a pension of 300 euros directly into their account, or have more than 20,000 euros in investment funds, savings or pension plans, as well as paying three bills through the account or making three purchases with their card every quarter. If they only have their salary or pension paid in the bank charges 60 euros a year.

In June2021 BBVA also tightened its conditions for those who want to avoid maintenance charges. The group announced that it would be charging 160 euros a year for clients who did not meet its conditions, justifying the decision by blaming "the economic situation following the health crisis, and the evolution of the financial markets".

To avoid paying commissions customers have to fulfil three criteria: income paid in (salary of more than 800 euros, pension or benefit of more than 300 euros, or periodic credits of more than 800 euros a month); payments through the account (five bills in four months or seven credit card purchases in four months) and products (loan, mortgage, insurance, investment funds, savings plans or insured incomes, or three payments of 200 euros by card in four months).

BancSabadell, and its subsidiary Solbank, in the meantime, increased its commissions for account maintenance twice last year, the first to 60 euros a year and the second to 120.

To avoid having to pay these, clients have to take out some type of insurance or loan or have at least 10,000 euros in investment funds with the bank, as well as having income of at least 700 euros a month paid directly into their account.

In March, Unicaja Banco told its customers that charges were going up for those who did not fulfil the requirements of its Zero Commission Plan: a salary, pension or unemployment payment of 600 euros or more paid directly into the account, or regular credits of at least 7,200 euros a year; pay at least 1,200 euros a year by credit card or a minimum of two operations a month; and have an insurance policy through the bank, or have a minimum balance of 6,000 euros in the account or in other products (investment funds, pension plans or savings).

Only those who fulfil all these requirements will be exempt from commissions. Those who only fulfil some of them will pay 60 euros a year and those who don't fulfil any of them will have to pay 120 euros.

Credit and Debit Cards

In addition to the cost involved in having a simple bank account there is commission for other basic services such as a debit card. Most banks have stopped offering these free of charge, unless the client fulfils the conditions listed above.

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On a personal level I have accounts at two banks. My main account is at BancSabadell, where I fulfill their requirements and have free banking, including my credit and debit cards.

I have also had an account with Unicaja for over 20 years. They have just started to charge me 10 euros a month, ie 120 euros a year, despite always having had free banking up to now.

I don’t fulfill one of their requirements and they are not prepared to be flexible and make an exception, so I have closed the account and switched to CaixaBank, whose requirements are less strict than the other big banks.

I would have thought that Unicaja would have appreciated my loyalty for over two decades, and accommodated me, but no, so “¡ADIÓS Unicaja!”.

With acknowledgements to SUR IN ENGLISH