Banking in Portugal: Expats Guide; All You Need to Know
Farrukh Dall
Opening bank accounts can be a challenging process in many countries, especially in financial centers like the UK, Singapore, and Hong Kong. The same applies to most European countries. However, as you will discover in this video, Portugal stands out as one of the easiest countries for non-EU residents to open a bank account.
Portugal boasts over 150 banks that offer financial services to individuals and businesses. Unlike many EU countries, where non-residents may face difficulties in opening an account, Portuguese banks are generally more welcoming to foreigners.
This video will provide insights into how the Portuguese banking system operates, highlight the best banks in the country, and guide foreigners on opening a current account or obtaining a mortgage to purchase a house.
Here are the essential aspects to consider regarding banking in Portugal
- Currency: Portugal uses the euro (€) as its national currency since joining the European Union and the eurozone in 1999. Euro is the default currency for banking accounts and transactions in the country. Additionally, it is possible to open accounts in foreign currencies such as the dollar, pound, Swiss franc, yen, and others.
- 2. Bank types: Portugal has a diverse range of financial institutions, including public and private retail banks, cooperative banks, investment banks, and mobile banks. International banks also have branches operating within the country.
- 3. Business hours: Most Portuguese banks operate from Monday to Friday, between 8:30 AM and 3:00 PM. Bank offices are closed on Saturdays, but ATMs are available for cash withdrawals and payments.
Types of Banks in Portugal
In Portugal, it is easy to find a suitable bank for whatever needs you may have. Some of the types of banks are:
- Private national banks
- International banks
- Public retail banks
- Regional cooperative banks
- Investment banks
- Savings banks
Best National Portuguese banks and their services
The Bank of Portugal, Banco de Portugal, serves as the central bank of the country. Its headquarters are located in Lisbon, with additional branches in Porto, Madeira, and the Azores.
In addition to overseeing the activities of banks, the central bank also regulates other financial institutions such as insurance companies, investment funds, credit brokers, and pension funds.
Caixa Geral de Depositos (CGD), founded in 1876, is the only public bank in Portugal.
CGD has a wide international presence with branches operating in 23 countries, including EU member states, the UK, Brazil, Mexico, Canada, India, and China. In Portugal alone, there are 543 branches.
CGD offers a range of services to individuals and businesses, including deposits, corporate and consumer loans, mortgages, car loans, and life and property insurance. According to the Banker magazine, Caixa Geral de Depósitos is listed among the world’s top 200 banks.
Millennium BCP, located in Porto, is counted among the top five largest banks in Portugal. With a network of 458 branches spread across the country, it also has a presence in Poland, Macau, Mozambique, and Angola.
Both Portuguese citizens and foreigners can avail themselves of the services offered by Millennium BCP, including opening deposits, acquiring insurance, trading securities, or obtaining loans, factoring, online banking, and the issuance of guarantees. For instance, the Millennium app enables users to conveniently carry out payments from their business current accounts and exchange documents and information with the bank, all without having to leave their office.
Novobanco, a privately-owned bank, boasts a network of 358 branches spanning from Lisbon to Madeira and the Azores. Recognized for its exceptional brokerage services and trust securities management, the bank was honored by the Global Finance magazine as the finest in Portugal.
Banco Santander Totta, headquartered in Lisbon, is among the top five largest banks in Portugal. It has been honored with the prestigious Euromoney Awards for Excellence, which recognize the world’s best credit organizations as determined by Euromoney magazine. Additionally, Global Finance has included Santander Totta in its list of the most trustworthy European institutions. This recognition was based on evaluations in five key areas: financial stability and security, risk management, breadth and quality of banking services, customer knowledge, and staff expertise. Serving both individuals and businesses, the bank operates 368 branches across Portugal, providing a wide range of financial services.
Banco Português de Investimento (BPI)
Banco Português de Investimento (BPI) is an investment bank headquartered in Porto. BPI has more than 1.4 million customers, individuals, businesses and institutions. Through its multi-channel distribution network with 674 branches, 30 investment centers and branches, the bank specializes in home loans through a network of outside companies. BPI offers a comprehensive range of financial services to Portuguese citizens, residents, and companies, including loans, deposits, overdrafts, life and property insurance, as well as brokerage services.
BPI supports Portuguese farmers, agro-industrial companies, and other industries with substantial credit lines and loans.
Multibanco Network System
In Portugal, there is a widely used interbank network system called “Multibanco,” which connects various Portuguese banks through a shared network. This system encompasses approximately 12,000 ATMs across the country. One of the advantages of Multibanco is that you can withdraw cash from any of your accounts at these ATMs without incurring any fees. Moreover, Multibanco allows you to conveniently pay bills, taxes, social security contributions, transfer money, and top up your account.
For more detailed information about the Multibanco system and its functionalities, I encourage you to check out the Payment Methods section of this video. It provides comprehensive insights into how the system works, its benefits, and how it has become an integral part of the banking landscape in Portugal. Don’t miss out on this valuable resource to enhance your understanding of the Multibanco system. Remember to like and subscribe to stay updated with future content!
Best international banks in Portugal
These include banks from Brazil, China, Angola, and other countries. If you happen to be a resident or citizen of any of these countries, you may be able to use your local bank in Portugal as well. Some of the most popular international banks in Portugal are Abanca, Barclays, BBVA, BNP Paribas, Citibank, Credit Agricole, Deutsche Bank and ING Bank. These banks provide financial services to companies and residents of Portugal.
Functionalities and benefits of having a bank account in Portugal?
Portuguese banks, just like any other bank in the world, provide a number of services for personal accounts and corporate accounts. Some of the common services include:
- Checking accounts
- Loans and overdrafts
- Mortgages
- Savings and investments
- Insurance
- Digital and online banking
- Mobile banking
- Business banking
- Expat services
- Trading services
You have the flexibility to choose from face-to-face banking, online banking, or mobile banking services. With online banking, you can conveniently handle transactions, payments, and loans anytime. Mobile banking offers the same features through a dedicated app, allowing you to manage your finances on the go. Some banks exclusively provide services through mobile apps.
The Best Online Banks in Portugal
If you are a non-resident but have a NIF number (Portuguese tax number), you can open your account online. In this case, you’re required to do a video call with the bank after you submit your documents. The list below offers the best online banks you can use to open your bank account. You can easily open your account online and do all your transactions online with the below banks:
- ActivoBank
- Banco N26
- Caixa Geral de Depósitos
- Millennium BCP
- Novo Banco
Also, if you plan to stay in Portugal for a short period, it may be a good idea to use banks or fintech solutions such as N26, Revolut, or Transferwise.
Investment Banks in Portugal:
If you’re an investor, you may want to consider the following banks as viable options:
- Banco Carregosa
- BiG (Banco de Investimento Global)
- Banco Finantia
- Banco Invest
These banks have established themselves as reputable institutions in the investment sector and offer a range of services to cater to the needs of investors. Whether you’re looking for wealth management, investment advisory, or other financial services, these banks are worth considering. Make sure to conduct thorough research and consult with professionals before making any investment decisions.
International Money Transfers
When it comes to international money transfers from Portuguese banks, it’s important to note that fees are typically involved. The specific details of these fees can be obtained by consulting your bank directly. While there is generally no set limit on the transfer amount, transfers exceeding €50,000 require reporting to the central bank of Portugal, Banco de Portugal. International money transfers typically take three to five working days to process.
If you’re seeking more affordable and faster alternatives for money transfers, you may find the following options helpful:
– CurrencyFair
– Moneycorp
– Remitly
-ACE Money
These alternatives offer competitive rates and quicker transfer times.
Bank Fees in Portugal
In Portugal, most banks typically impose a monthly fee on their account holders. The cost of a Portuguese bank account typically ranges between €5-7 per month, amounting to approximately €60 per year. Additional charges are applied to services such as credit cards, overdrafts, loans, and mortgages. The exact fees vary depending on factors such as the type of card, the specific bank, and other relevant criteria.
For international money transfers, banks usually charge a fee of less than €15 for amounts below €50,000. However, for larger transfer amounts, the fee can amount to approximately €30 or more.
Low Maintenance and Transaction Costs
Depending on your bank of choice, the Portuguese banks typically have quite competitive fees. You can still find some banks in Portugal that have no maintenance fees or debit card fees. Activobank and Banco CTT are among these options.
Within the Eurozone, standard transactions such as ATM withdrawals, and Euro transfers are also either free of charge or involve negligible fees.
Bank cards: types and cost of service
You can apply for a credit or debit card online or at Portuguese bank branches. As a rule, banks do not charge a commission for issuing and servicing debit cards. Credit card service fees vary from €0 to €50 per year.
The average rate for credit cards is 11—13%. For example, at Banco Santander Totta, the credit card rate is 13.1% per annum.
Portuguese banks issue two types of cards: regular and contactless. You can pay utility bills and shop in online stores with mobile banking apps.
The limit for purchases with a bank card without a PIN code is €50.
Fees for servicing bank cards in Portugal
| Bank | Banking fees per year |
| Activo Bank | €0 |
| BNI Europa | €23.9 |
| Banco Big | €33.2 |
| Best Bank | €41.8 |
| Banco CTT | €19.2 |
Card Frauds: Portugal boasts a low rate of card fraud, standing at 0.009% per transaction, which is one of the lowest rates in the European Union. This reflects the country’s strong banking security measures.
How to get a credit card from a Portuguese bank?
Once you have successfully opened a bank account as a non-resident, you can proceed with the application process. The banks will gather the necessary information to assess your creditworthiness. In some cases, for new accounts, certain banks may require a minimum deposit to access full banking services such as credit cards or mortgages. Bank accounts in Portugal offer comprehensive features and services to fulfill all your banking needs and preferences.
When applying for a credit card, banks in Portugal typically assess your creditworthiness based on factors such as your income, employment status, and financial history. The credit limit granted on the card will depend on these factors as well. Different types of credit cards may offer various features, such as rewards programs, cashback benefits, or travel perks.
Portuguese credit cards are widely accepted in various establishments, including retail stores, restaurants, and online retailers.
When Your Card is Lost or Stolen
If you require assistance or have inquiries regarding your Portuguese bank account or card, it is advisable to contact your respective bank or card provider directly. They will be able to provide you with the necessary support and guidance.
In the case of a stolen Multibanco card, it is crucial to inform the police immediately. Taking prompt action will help ensure the security of your finances and prevent any unauthorized transactions. For reporting a stolen Multibanco card, you can reach out to the following contact number: +351 21416 9314.
Other payment methods in Portugal
Cash
In Portugal, cash remains a widely used payment method, as not all establishments accept banking cards. You can conveniently withdraw money from local ATMs, with approximately 11,000 ATMs available throughout the country. It’s important to note that there is a limit of €3,000 on cash transactions in Portugal.
Multibanco ATM payments.
As previously mentioned, Portuguese banks are interconnected through the national Multibanco payment system. This integrated network links ATMs, payment terminals, and online banking services, providing a seamless and unified banking experience for customers.
The Multibanco system in Portugal offers over 90 different transactions, allowing individuals to conveniently pay monthly bills, taxes, make social security contributions, transfer funds between accounts, top-up mobile phones, and purchase tickets, among other services. Multibanco ATMs accept major bank cards including Visa and Mastercard.
It’s important to note that there might be transaction limits, typically around €200 per transaction or €400 per day. When using a foreign bank card, a commission is usually applied, amounting to approximately 2-3% of the transaction amount. However, some international banks, such as Deutsche Bank, are part of the Global ATM Alliance, which enables their customers to make ATM transactions without incurring any commissions or fees.
Online and contactless payments
Online and contactless payments in Portugal can be conveniently made through various methods, including:
– Banking apps provided by the respective banks.
– Mobile payment apps such as Apple Pay or Google Pay.
– Digital wallets like PayPal.
Direct debits
In Portugal, direct debits are commonly used for bill payments. They provide the convenience of setting up regular payments that can be canceled or modified at any time. However, it’s important to note that when revoking a direct debit, the payer must inform the company or entity to which the payments were being charged.
In cases where the payer was not properly informed about the amount debited or if the debited amount is unreasonably high, the payer has the right to claim a refund. The claim for a refund must be submitted within 8 weeks from the date of the payment.
Direct debits offer a convenient and automated method for bill payments, allowing individuals in Portugal to manage their financial obligations with ease. It is advisable for payers to regularly review their direct debit arrangements and ensure that the debited amounts align with their expectations and agreements with the billing entities.
Payments by check
In Portugal, the use of checks for payments has become less common. Banks no longer issue checkbooks automatically, and they must be requested separately.
It is important to note that issuing checks without sufficient funds to cover them is considered a criminal offense. In such cases, the issuer may face charges of fraud and be required to pay a fine amounting to 20% of the bounced check value. Additionally, the violation can result in being blacklisted by the Bank of Portugal.
ATMs
ATMs can be found at various locations in Portugal, including local bank branches, supermarkets, airports, and hotels. To locate the nearest ATM, look for those with services provided for major card networks such as Mastercard, Visa, or American Express.
How to open a current or deposit account in the best Portuguese banks
Current accounts. Citizens and residents over 18 can open an account online. The registration procedure is similar in most banks and takes no more than 20 minutes. It is necessary to register an account on the bank’s website and attach copies of:
- a passport;
- a residence permit card;
- a NIF;
- an employment contract, pension certificate or university enrollment document;
- a certificate confirming the place of residence.
Some Portuguese banks require digital signature and video verification for online account opening. After the verification, the account can be activated with a minimum deposit, such as €250 at Montepio Bank. Banking fees are generally high, like €20.8 per year per account at Banco CTT. Companies in Portugal can open online bank accounts with required documents. The account becomes active upon receiving the first payment from a Portuguese or EU/Schengen country account.
Typically, foreigners are required to visit a branch in person to open a current account in Portugal. However, certain banks offer online services to non-residents. For instance, Banco Best allows the opening of an account and issuance of a debit card through their online platform. The service carries an annual cost of €19.5, along with a one-time account opening fee of €40.
A non-resident needs a passport, confirmation of the income legality and a NIF to open an account.
Required Documents to open a bank account as an expat
While some of the Portuguese banks allow opening your account online, most of them require you to visit their local branch in person. Nevertheless, the process is easy and the required documents are quite easy to collect. Although it may depend on your choice of bank, in general, the documents you need are as follows:
- Proof of Identification (e.g.; a passport would be sufficient)
- Proof of address (e.g.; a recent utility bill or letter received in the last three months with your visible name and address)
- Portuguese NIF Number
- Proof of Income/Employment (e.g., recent payslip or an employment letter)
- If you are not employed, you can still open an account, provided that you have proof of registration with the Portuguese employment center (Centro de Emprego) or you have a work contract assurance
- Portuguese Phone Number for SMS Activation
- Additionally, a deposit of € 100-300 in cash
Deposit accounts. During the pandemic, many European banks introduced negative deposit rates. Depositors had to pay the bankers extra with their savings. For example, in the German Volksbank, the rate on deposits over €100,000 was -0.5%. Portuguese banks do not use negative rates, but some banks do not charge interest on deposits.
The minimum deposit amount is €125. All deposits are insured. If a bank has financial problems, the client is guaranteed to receive €100,000.
A bank deposit can be opened in euros or US dollars. However, the yield is higher for foreign currency deposits. For example, BPI does not charge interest on euro deposits. But if you deposit at least $250 for three years, the bank will charge interest of 0.9% per annum.
Portuguese banks open deposits even to non-residents. However, a foreigner has to come to Portugal and personally apply to the bank.
How to get a bank loan in Portugal
The country’s citizens and residents can get loans for personal needs or buy a car in Portugal. Loan interest rates at Portuguese banks are lower than the average in the European Union. For example, in 2021, the average loan rate in the EU was 4.2%, while in Portugal, it was 3.9%.
The most common reason to get a loan is to buy a car. If the vehicle is used, the loan interest is higher. The loan interest rate for new cars is 5%, and it’s up to 11.8% on used cars. For example, Santander Totta bank issues money for a new car purchase at 5.75% per annum, and for used vehicles — 9.4%.
The main limitation is that you can sell the car before the end of the loan agreement only with the bank’s consent.
The interest rate on consumer loans depends on the amount and terms of the loan agreement. Online loans are more expensive. The main advantages of such loans are that you do not need to go to the bank, and applications are considered in a couple of hours. The money is credited to the client’s account immediately after the application approval
Interest Rate
The current interest rate in Portuguese banks is 0.25% for most bank accounts.
You can mostly pay with international debit cards across Portugal. Most vendors accept MasterCard, Visa, or American Express. However, most of them will charge usage fees.
