Healthplan Spain


Can Expats In Spain Use A Foreign Bank Account To Pay Their Bills? Expat Tips

Owning or renting property in Spain comes with the responsibility of managing utility bills, including water, electricity, and internet expenses. The convenience of direct debit payments is undeniable, but what if you lack a Spanish bank account? Can you set up a direct debit from your foreign account to tackle these bills hassle-free?

If your bank account is registered with another EU nation, you'll likely encounter smoother procedures for settling your Spanish property bills through direct debit. The European Union took a decisive step in 2014, enacting a law that forbids discrimination against international bank account numbers (IBANs) originating from fellow EU countries. This might seem straightforward at first glance, yet, true to the nature of many bureaucratic processes in Spain, the reality is more intricate.

Real-world applications reveal that the SEPA (Single Euro Payments Area) law, unfortunately, isn't consistently upheld by Spanish companies and institutions. When attempting to establish a direct debit using your foreign card within the country, you'll often face the disheartening revelation that it's deemed invalid. Reports from the field indicate that major entities like Movistar, an internet service provider, and Endesa, an electricity company, restrict direct debits solely to Spanish bank accounts.

This issue, labelled as ‘IBAN bias’, is a predicament that extends beyond Spain, impacting several other European nations as well. In the event your IBAN doesn't commence with 'ES,' service providers assert the unfeasibility of establishing a direct debit arrangement, thereby compelling you to reluctantly establish a Spanish bank account.

This situation can be particularly unpalatable for non-resident second-home owners who might be averse to incurring the usual covert charges tied to initiating a Spanish bank account – a sentiment exacerbated by their infrequent presence in Spain.

Several neobanks, including the ones below, have rallied against this unjust discrimination, culminating in the formation of a platform known as ‘’ Regrettably, despite these endeavours, substantive change has yet to materialise at the level of the Spanish government, save for the minor adjustment allowing tax payments from non-Spanish accounts.

Some accounts you could explore are...

  • Revolut or N26 Accounts: Exploring the option of opening an account with Revolut or N26 can be advantageous. These banks extend accounts furnished with Spanish IBANs, effectively bypassing the issues linked with conventional Spanish bank accounts.
  • Alternative Fintech Solutions: Several other fintech entities operating within Spain provide the convenience of Spanish IBANs. Brands like Bunq, Nickel, Vivid, Rebellion, Wise, and Bnext are among those worth exploring.
  • British Nationals: For British citizens, reaching out to Starling Bank or Monese offers the possibility of a Euro account. However, it is important to note that these might not always suffice for paying Spanish utility bills and might entail additional charges for international transactions.

As always, it is prudent to scrutinise any supplementary fees linked to international transactions.

In the absence of alternative options, the regrettable truth is that your choices may become restricted, leading to the eventual requirement of setting up a Spanish bank account in the interim. Then as progress continues and potential changes take shape, you could find yourself presented with a more customised solution that suits your requirements.