Is It Possible For Expats To Pay Their Bills Directly From A Foreign Bank Account?

If you invest in a property in Spain then, unfortunately, you’re going to have bills to pay! This is also true if you choose to rent a property in Spain, either in the short or long term. Water bills, electricity bills, internet bills, the list goes on. The easiest way to pay your bills is by setting up a direct debit. But what if you don’t have a Spanish bank account? Is it possible to set up a direct debit from your foreign bank account to pay your bills in a hassle-free way? Here’s everything you need to know:

What Happens If You Have an EU Bank Account?

If you have a bank account with another EU country then you should find it easier to pay your Spanish property bills via direct debit. In 2014 the European Union passed a law that made it illegal to discriminate against an international bank account number (IBAN) from another EU country. Sounds easy, right?

Sadly, as with many bureaucratic processes in Spain things are a little more complicated. The SEPA (Single Euro Payments Area) law is rarely respected by companies and institutions in Spain and you’re likely to find that you’re told that your card is not valid when you try to set up a direct debit using it in the country. Anecdotal evidence shows that internet provider Movistar and electricity company Endesa will only set up direct debits with Spanish bank accounts.

What Happens If You Have a Third Party Bank Account?

Given that EU nationals struggle to set up direct debits in Spain without a Spanish bank account, it is near-impossible for third party nationals to do so. This is a problem referred to as IBAN discrimination, and it’s a problem that affects plenty of other European countries as well as Spain.

If your international bank account number (IBAN) doesn’t start with the letters ES then the vast majority of service providers will simply states that it isn’t possible for the direct debit to be set up.

This is a real and recognised problem. A number of neobanks such as N26, Revolut, Starling Bank, Klarna, Raisin and Wise have raised the alarm about this unjustified discrimination, setting up a platform called to raise awareness of the issue.

What Can You Do?

Many international bank account holders are left feeling they have no choice but to open a Spanish bank account in order to set up direct debits and pay their bills. This can be frustrating, as the hidden fees and expenses of holding a Spanish bank account will add to the cost of your bills. Unhelpful when you’re not living full time in Spain and have other expenses too. The Spanish government are aware this is an issue but have not made any changes to the process at this point. The only change made so far is that people can now pay their Spanish taxes from a non-Spanish account.

Options you can try include:

  • Opening an account with Revolut or N26. These banks both offer accounts which come with Spanish IBANS, circumnavigating the problem.
  • Other fintech companies that operate in Spain and thus offer Spanish IBANs are Bunq, Nickel, Vivid, Rebellion, Wise and Bnext.
  • Britons could contact Starling Bank or Monese as they both offer a euro account to British citizens. However these cannot always be used to pay Spanish utility bills, and may carry additional fees for international transactions.

If not, unfortunately you will have little choice but to set up a Spanish bank account at this time.

Are you thinking of moving to Spain? Looking to escape the cold and rainy weather in the UK and make an escape to the sun? Then why not get in touch with our local property experts, who are perfectly placed to help you buy the Spanish home of your dreams. We’re excited to help you make your next move your best move!