Advice please - thinking of closing our bank account to avoid rip-off fees

Hopefully I can get some good advice here. We have a holiday home in Spain that we visit often. We spend less than 6 montyhs in Spain in total each year and therefore are not residents for tax purposes.

Apart from the property insurance each year, we pay all the utilities by either cashor Uk debit card on each visit. This has worked perfectly for years. Having realised that basically we only use tha bank account to have our insurance paid out of each year, I considered closing my account. The charges, as many here, will be familiar, are nothing short of a rip off and equate to at least when the insurance policy costs each year. My insurance office has said I can pay either in cash or on an british debit card by phone each year. This means I dont need a bank account and can save the rip off fees.

My question is that whilst one has to have a bank account to buy a property, is there any obligation to have one afterwards? I would imagine many of the spaniards in my little village dont have accounts - so would be surprised if it is an actual necessity.

Anyway any advice/tips would be appreciated.

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useful for direct debits for electricity, water and local taxes

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Hi John

Thanks for your response, but, as I mentioned in my OP, we are only using it now for the insurance - all utilities paid at PO or utility offices when we are there (no trouble whatsoever). My question was - is it a legal requirement to have a bank account? Im pretty sure it isnt - but just seeking others' views.

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Hi

How do you pay your Utility Bills such as Endesa,Aguagest,Council Taxes and the Model 210 Non-Residents Tax Return for the Six Months when you are not living  in Spain. Surely it is easier to have a   Spanish Bank Account to facilitate these payments. Why don't you look around for another Bank with cheaper fees. I am sure you can find one. Maybe some other Forum Users can advise you on this Subject.

 

Regards

 

 

This message was last edited by nigel188 on 21/10/2013.

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The law does not oblige anyone to have a bank account.

Just bear in mind that some, maybe all, banks charge to close accounts. So I suggest you run down / draw out all but a few cents and then close the account  ASAP so you do not incur other maintenance charges in the interim.

 

As for paying the 210, Kathyslad has posted elsewhere that they can be paid even thoiugh a non Spanish bank.

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What do you call "Rip of fee's?" because with my bank if i keep a minumum balence of €600.00 in the account all the time i pay no fee's with 3 standing orders.

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Thanks, but many of the responses seem to simply question the decision not to have an account. That is not my issue. My issue is that of do you have to have a bank account? Now it appears that you dont then I will be closing ours.For the record, I pay the bills that you mention, either (are you ready for this?) in cash or online. I have no trouble at all doing this. It was just the insurance company who needed (up until now) to take by DD. I pay my online bills with a UK debit card anyway! If I was fulltime there then I appreciate I would be more embroiled in the system and a bank account would be a necessity probably. Thanks for your input on this.

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Baz,

                     Most banks do charge fees for almost every service they provide, so most of us knew where Rialto was coming from.

This is a report (I googled, I and found a ton similar about high fees) which shows the average situation:-

Spain’s FACUA consumers association has measured the amount paid to banks in commission fees by account holders each year. The study found that a typical user pays on average €145.82 per year in commission fees on their account.

The user profile used in the study is of a consumer who pays 6 bills by direct debit, carries out 7 payments with a debit card and at least 1 with credit card every month and makes 2 transfers, pays in 2 cheques and pays another 2 standing orders every year.

The banks that charge the most out of those in the study are Barclays (€200.40), Santander (€177.40) and Unicaja (€176.20).

The association carried out the study after a comparative investigation was made by its federation in Andalusia about commission fees that 12 banks apply to current accounts and savings accounts for maintenance, administration, paying in cheques, transfers and being overdrawn.

The study refers to accounts where users are not obliged to state their salary or pension or to contract other bank services, conditions under which some banks eliminate a good part of their commission fees.

Banks were rated as the s2nd most criticised sector in 2012 by FACUA´s consumers, primarily motivated for the application of abusive commission fees.

Only one of the banks surveyed did not apply commission fees to current accounts for maintenance, administration, paying in cheques and transfers, and that was ING Direct.

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So do i know where Rialto was coming from, so do include me in with the "Most of us",  he/ she want to close the bank account due to high fee's, i asked what they considered as high fee's because, as i said the Spanish bank i am with don't charge me any fee's if i keep a minimum €600.00 in the account all the time,   I have 3 direct debits and free money transfer from England to Spain, and unlike many of the posts on here about the bad banking system they seem to have, i have never ever had one problem of the banks doing.

And no i am not with ING for free banking, or any of the others in fact that you took time to find that do.

 

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Baz, what I posted was an extract form a, NGO about banking in Spain, not my own observations.

Bully for you having found a bank which is reasonable, perhaps you will tell us which one it is, so others can benefit.

I have banked with at least 5 banks in Spain in the passed 30 years.  I have also helped friend with banking problems with other banks.  Almost all bank can and do charge for services which in UK one often expects to get free.

I have just closed my wife’s account and my son’s account with Caja Mar as they started charging 15 euros per quarter per account, just to maintain the account. My son had DDs etc. but my wife’s account just received her savings and over the several years she had had the account, she never made a withdrawal nor required any other service.  With a balance of over 6,000 euros, they started charging the 15 euros per quarter,  that’s a rip off.

Some few years ago Solbank charged me 0.5% to transfer funds in a sterling account to a sterling account in another bank. The charge was on the whole amount and came to just over 800 euros. That’s a rip off.

Spanish bank as a normal practice charge a percentage on the whole sum to receive funds transferred into an account. That can be substantial, running into hundreds of euros even,  if the funds are large, say for the purchase of a property. That’s a rip off.

Usually if one is aware that a charge will be made it is possible to negotiate a lower charge, sometimes, as with Solbank, they will not negotiate. That’s a rip off

I think that is enough but I could go on with more examples, to show that Rialto was making a reasonable point.

 

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Many thanks for all your advice hear. Johnzx sums up my stance on it. I suppose by being spoilt by Uk banks by having no charges like one has in Spain, my demands as a consumer are pre-set in my mind. Plus, most importantly, now that it is clear that it isnt a legal necessity to have a bank account in Spain, then I have made the simple decision to stop the account. The charges for last year were just short of the annual premium I pay for my house insurance - which was the only reason I kept the account (because up until recently they insurance company insisted on DD from a spanish account).

Had they (insurance company) not made this change, I would have simply shopped round for some other company who would take debit card/cash - and then still closed my bank account. Spain reminds me, from a customer-care culture aspect, of Britain in the 70s. It doesnt get me angry - although it does amuse me how much they have to learn in order to get up to speed with more customer focussed nations.

Once again thanks to all who helped on this handy resource!

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Just do not open a Santander account as I have recently closed our account with them due to horrendous charges and all for the privilidge of them using our money all year. They said the account was changed 3 months after we opened it which was news to us. I spoke to their customer services in Madrid and they did refund 60€! but they would not/could not explain why the account was changed.

I closed the account and they wanted 12€ to close the account which I refused to pay. The Account was closed but I had to go to the branch where the account was opened. We are now with Barclays who were brilliant and so helpful and no charges for using my debit card or direct debits like Santander decided to do a year or so after we opened the account.

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Maybe Barclays Spain (they are not Barclays UK) have changed over the years. If they have,  they certainly have a very bad reputation to live down, especially regarding high charges and poor service, so maybe  they are trying harder than most. But, for me old memories die hard.

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So far so good, but they were very professional here in Jerez and two staff spoke perfect English. The brilliant young guy even showed me how to set up a standing order. Their on line banking is a doddle also.

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Hi all, I don't know if this thread is still open as the last posting was in October 2013. However hopefully Baz 1946 might disclose the name of his bank so that we can all benefit from the free banking.

My bank Cajamar have recently started charging 15€ every three months. As I have been out of Spain for the past 7 months I have only just got round to querying this with them as I hadn't received any prior notification. When I asked whether there was a way to avoid these charges I was offered the possibility of buying shares in the value of 1036 €. In addition to having my debit card fees reduced from 30€ to 15€ p.a. I would also receive some interest. this was all in Spanish so I hope I have understood all this correctly. I have asked for some documentation to read and possibly have translated.

I have also discovered on line that if you open a new online account with Banesto.com you can avoid charges.

Does any one have any experience with the above mentioned?

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This is part of my post from another thread:- 

Just for info:   I get free banking (Cajamar) with just my OAP (married person) pension being paid in. My wife holds shares in the bank:  she also gets free banking (plus dividend payments)  because of that.

Pegreen. The staff at my branch all speak English (although unnecessary for me as I speak Spanish) and they are very helpful.  Having banked with several other banks in Spain in the 27 years I have lived here,  I find Cajamar is the best compared with the others.

I did cancel my Credit card with them as I could not avoid having a maintenance fee imposed. I now use my UK visa card when I need to. There is no problem with using that card, I always pay in Euros, no charges either end and the exchange rate I get from  Visa in UK (Nationwide) is excellent.

PS      Pegreen. Isn't Banesto, now Santander ?

This is a post by Camposol, from another thread about Santander,      'We were also told that we were no longer eligible for free banking, which we had been having  for years,because we had less than 600 euros transferred every month.

 

This message was last edited by johnzx on 20/06/2014.

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Hi all, I don't know if this thread is still open as the last posting was in October 2013. However hopefully Baz 1946 might disclose the name of his bank so that we can all benefit from the free banking.

My bank Cajamar have recently started charging 15€ every three months. As I have been out of Spain for the past 7 months I have only just got round to querying this with them as I hadn't received any prior notification. When I asked whether there was a way to avoid these charges I was offered the possibility of buying shares in the value of 1036 €. In addition to having my debit card fees reduced from 30€ to 15€ p.a. I would also receive some interest. this was all in Spanish so I hope I have understood all this correctly. I have asked for some documentation to read and possibly have translated.

I have also discovered on line that if you open a new online account with Banesto.com you can avoid charges.

Does any one have any experience with the above mentioned?

Hi pegeen.

The name of the bank I use is now Sabadell, which was Lloyds, which was Halifax, and I still don't pay any charges, they pay out six standing charges on my two house's, I do keep an amount in the bank over and above 600€.

The bank staff in my branch all speak English, well the ones I have dealt with have, perhaps some don't, yet when I spoke to one in Spanish, who could speak English, she asked me how come I spoke Spanish like a Spanish person? I told her my Spanish Grandmother was to blame for that, she now always speaks to me in English when I visit.

I have never had any problems with this bank of the banks doing, I can only suggest you check out a few banks to find one that please's you, but maybe as the banking world is changing so fast it wont be to long before even this one starts to charge me.

I have no idea of any of the workings of the one's you mention.

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I had a sterling investment account with Solbank, now Sabadell. 

There were no charges for having the account. However, they charged me 0.5% commission when I closed the account, on the entire sum invested. 

I knew that was the standard charge so I tried trying to negotiate a lower charge,  they were not interested.

It came to a charge of just over 800 pounds commission (0.5%)  to transfer my investment and that was by any M.O.    There was no way to make the transfer to anywhere (get my money back)  without paying that £800 charge.

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Thank you both for your replies. In answer to John's question yes I believe http://www.ibanesto.com/ is now linked with Santander. I got their info from http://familylifeinspain.com/how-to-avoid-bank-charges-in-spain/ . Maybe someone else has experience with ibanesto.com. 

Another question to John: I was told that the minimum amount to hold shares would be 1036 € which seemed rather steep to me to avoid paying 60€ p.a. bank charges. I'm not clear as to how much the dividends amount to. The debit card I will probably cancel I as I don't use it anyway.

Unfortunately the woman I spoke to isn't fluent enough to exlplain something like that in English and I want to understand it enough to make a financial commitment of that size.

We don't have a Sabadell in my area but do have Banesto and Santander. Maybe I'll decide to "swallow" it as like you say Baz things change very quickly in the banking world. Just so long as the UK banks don't follow suit and start charging us .

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Pegreen, My wife just under 6,000 euros worth of shares (I think it was / is the maximum) .  They were paying 3.9%, so she gets just over 230 euros p.a. on which tax is stopped at source, but then off-set on our tax return.

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