When settling in Portugal, opening a bank account is a top priority. It's crucial for receiving your salary, paying bills, and managing your finances. Research various banks to find one that suits your needs, whether it's a traditional bank or a digital banking solution.



The Portuguese banking system is governed by the Central Bank of Portugal and falls under the purview of the European Central Bank, ensuring that banks in Portugal adhere to rigorous EU standards. This regulatory framework guarantees the quality and reliability of banking services in the country, benefiting both Portuguese citizens and foreign residents. Portugal's banking sector offers a comprehensive range of services, catering to various financial needs.

Portugal is an integral part of the European Union and operates within the eurozone. Consequently, the official currency in Portugal is the euro (€), and all standard financial transactions are conducted in this currency. However, Portuguese banks also accommodate customers who wish to open accounts in foreign currencies. Some of the foreign currencies supported include:

- US Dollars (USD)
- Canadian Dollars (CAD)
- Australian Dollars (AUD)
- British Pound Sterling (GBP)
- Japanese Yen (JPY)
- Swiss Francs (CHF)

This flexibility in currency options caters to the needs of international clients and businesses engaged in cross-border transactions.

Most Portuguese bank accounts come with a monthly maintenance fee, typically ranging from €5 to €7 per month. Some accounts, such as student accounts, may offer preferential tariffs or exemptions from these fees. Additionally, certain services, such as credit cards, may incur charges, with the fees varying based on factors such as the issuing bank, spending patterns, and card types. On average, credit card interest rates in Portugal fall between 11% and 13%. The interest rate for loans typically hovers around 4%, while mortgage rates are approximately 3.3% per annum.

Portugal boasts one of the lowest card fraud rates in the European Union, with a mere 0.009% of transactions affected by fraud. Portuguese banks prioritize the security of their customers' data and maintain strict confidentiality standards for the services they offer. This commitment to safety and trust ensures that clients can confidently engage with the country's banking sector, enjoying peace of mind as they manage their finances in Portugal.

Basics of Banking in the EU: Your Right of Basic Financial Services as EU Resident.

As part of the European Union, Portugal must adhere to certain specific rules and respect certain rights. Whether you're a resident or a newcomer to an EU country, having a bank account is essential for managing your finances and daily life. In this article, we'll explore the concept of "basic payment accounts" in the EU and what you need to know about opening and maintaining one.

• Basic Payment Account Rights
  As a legal resident in an EU country, you have the right to open a "basic payment account." Banks cannot refuse to open such an account in your name simply because you don't reside in the country where the bank is headquartered.
  
  This right does not apply to other types of bank accounts, such as savings accounts.


• Circumstances in Which Banks Can Refuse
  While banks must generally open a basic payment account for you, there are some circumstances in which they can refuse.
  
  1. Non-Compliance with Anti-Money Laundering and Anti-Terrorism Rules: If you fail to comply with EU rules on anti-money laundering and counter-terrorism financing, a bank may refuse to open an account in your name.
  
  2. Existing Similar Account: In some EU countries, banks can refuse to open a basic payment account for you if you already have a similar account with another bank in the same country.
  
  3. Demonstrating Genuine Interest: In certain cases, banks may ask you to demonstrate a genuine interest in opening a basic payment account, especially if you reside in one EU country and work in another.


• Features of a Basic Payment Account
  A "basic payment account" is designed to cover everyday transactions, including:
  
  - Depositing money
  - Withdrawing cash
  - Receiving and making payments (e.g., direct debits and card payments)
  
  When you open such an account, you should receive a payment card that allows you to withdraw money and make purchases, both online and in physical stores.
  
  While the bank is required to provide online banking services with your account when available, it is not obligated to offer overdraft or credit facilities.


• Information on Fees
  Before opening an account, the bank must provide you with a "fee information document" describing the key services associated with the account and any applicable fees. You can use this document to compare the costs of accounts offered by different banks.
  
  Additionally, at least once a year, the bank must provide you with a "statement of fees" explaining the fees related to your bank account and providing information on interest rates applied.


• Changing Banks
  If you decide to change your basic payment account to another bank within the same EU country, your new bank should assist you in the process. Here's what your new bank should do:
  
  - Inform relevant parties, such as your employer, social security authority, or utility service providers, about the change in your bank account.
  - Set up new direct debits as needed.
  - Accept relevant direct debits on your new account.
  
  However, please be aware that closing your old account may result in fees.


• Your Money Is Protected in the EU
  EU legislation ensures that the money you hold in your bank account (both savings and current accounts) is protected in case the bank faces financial difficulties or goes bankrupt. This protection covers a maximum of €100,000, or an equivalent amount in the local currency, per person, per bank. If you have multiple accounts with the same bank, the €100,000 limit applies to the total amount across all accounts.
  
  There are exceptions to the €100,000 protection limit. In certain cases, amounts exceeding this limit are still safeguarded for a limited duration. These exceptions include:
  
  - Proceeds from the Sale of a Private Residence: If you receive money from selling your private residence, the amount above €100,000 is protected for a minimum of three months and a maximum of 12 months. This period is calculated from the date when the amount is credited to your account or becomes legally transferable.
  
  - Payments Following Specific Life Events: Money received as a result of specific life events, such as marriage, divorce, retirement, termination of employment, disability, or the death of a family member, may also be protected above the €100,000 limit. The same protection duration applies as in the case of property sales.
  
  - Insurance Compensation and Compensation for Acts of Violence or Wrongful Conviction: If you receive money from insurance claims or compensation for acts of violence or wrongful conviction, amounts exceeding €100,000 are protected for a minimum of three months and a maximum of 12 months, depending on the conditions and limits established by each EU country.
  
  These exceptions provide additional safeguards for larger sums of money during critical life events or unexpected situations, offering you financial security when you need it most.

Opening a Bank Account in Portugal as a Non-Resident.

Opening a bank account is relatively straightforward, but for non-residents in Portugal, it can be a bit different. While residents and citizens find it easier, non-residents may also do so for various reasons, such as spending extended periods in the country or conducting business affairs. Unfortunately, not all financial institutions allow non-official residents to open accounts, so it's essential to be well-informed and explore your options.

Considerations Before Opening an Account:

1. Research Bank Policies: Not all banks in Portugal cater to non-resident customers. Start by checking if the bank of your choice accommodates non-residents.

2. Compare Account Conditions: Evaluate the conditions offered by different banks. If you have foreign friends living in Portugal, their experiences can provide valuable insights. Word of mouth remains a reliable method to assess such situations.

3. Take a Responsible Approach: It's crucial to approach this process responsibly and sensibly, ensuring you comply with all legal requirements.

What Determines Residency in Portugal:

According to Portuguese law, individuals are considered residents if they have stayed in Portuguese territory, including mainland Portugal and the autonomous regions of the Azores and Madeira, for more than 183 days in a 12-month period. Partial days are counted. Even if you depart the country at 7 a.m. on a given day, that day is still considered a day of presence in national territory.

However, individuals who have spent fewer than 183 days in national territory can also be considered residents if they own a property in Portugal and intend to occupy it as their habitual residence. This concept of partial fiscal residence was introduced in Portugal following the income tax reform.

Opening a Bank Account for Non-Residents:

Non-residents in Portugal can open a bank account at banks that offer this service by presenting a set of documents. This can be done directly at the bank branch without requiring a prior appointment. However, bringing all necessary documents ensures a smoother process.

• Varieties of Bank Accounts in Portugal
  In Portuguese financial institutions, individuals have the opportunity to choose from various types of bank accounts, with the two most prevalent categories being current accounts and deposit accounts.
  
  • Current Accounts
  A current account serves as a fundamental and versatile banking instrument designed for day-to-day financial activities. Typically accompanied by a debit card, current accounts facilitate seamless transactions, including payments and cash withdrawals. It is essential to note that these accounts may entail maintenance fees and impose minimum balance requirements, which can vary from one bank to another.
  
  Moreover, Portuguese banks often tailor their current account offerings to cater to specific demographic groups, such as teenagers, students, or seniors. These specialized accounts frequently come with associated benefits, such as discounts, exemptions, or unique terms and conditions.
  
  • Deposit Accounts
  In contrast, deposit accounts serve the purpose of securely housing funds for extended periods, with the primary intention being to refrain from frequent withdrawals. Deposit accounts typically do not link to credit or debit cards, emphasizing their focus on long-term savings.
  
  While funds remain in a deposit account for a specific duration, they have the potential to accrue interest. However, it's important to be aware that certain restrictions may apply, dictating both the maximum withdrawal amount and the frequency of withdrawals.
  
  Upon deciding to close a deposit account, individuals retain the option to withdraw the accumulated funds or transfer them, often subject to a percentage-based fee, to a different account of their choice. This flexibility ensures that clients can manage their finances according to their evolving needs and preferences.


• Documents Required for a Bank Account for Non-Residents:
  Non-residents in Portugal need to provide a personal identification document, such as a passport, birth certificate, or, for EU citizens, an identity card. They also need tax identification, including a taxpayer card and a provisional NIF (Número de Identificação Fiscal) specifically assigned to non-residents.
  
  To open a business bank account, you must provide the documents above and other papers concerning your business - for example, company registration documents and names and addresses of the owners and directors.


• Additional Requirements for Non-Resident Bank Accounts:
  In addition to identification documents, non-residents must provide further documentation to open a bank account in Portugal. These requirements are somewhat more demanding:
  
  Proof of Address in Home Country - Non-residents must provide proof of their address in their home country, typically through the most recent tax settlement document issued and certified by the tax authority of their home country.
  
  Proof of Profession - This could be an updated payslip, a professional card (if applicable), or a statement from the employer for those working for others.


• Banking Options in Portugal for Non-Residents
  Portugal boasts a diverse banking landscape, with a plethora of choices catering to both residents and non-residents. With over 150 banks in operation, ranging from local institutions to international players, the country's banking sector offers a wide array of services and conveniences.


• Local Banks:
  Portugal hosts several reputable local banks, including both private and public retail banks. Caixa Geral de Depósitos, the sole public retail bank, stands alongside esteemed institutions such as Banco de Portugal, Millennium BCP, Novobanco, and Banco Santander Totta. These banks form the backbone of the nation's financial infrastructure and provide essential services to a broad clientele.
  
  Operating during regular business hours from 08:30 to 15:00 on weekdays, local banks typically observe the standard weekend closure.


• International Banks:
  In major Portuguese cities, international banks have established a significant presence. These banks often employ English-speaking staff and offer services tailored to the needs of expatriates and international clients. Prominent foreign banks operating in Portugal include Germany's Deutsche Bank, France's BNP Paribas, and America's Citibank. With working hours mirroring those of local banks, international banking institutions provide a seamless banking experience.


• Online Banking:
  Portugal's banking sector has embraced the digital age, with the emergence of online banks that facilitate banking activities through smartphones and laptops. These digital banks offer the convenience of opening personal and business accounts, obtaining insurance, and conducting various financial transactions, all within the digital realm.
  
  Online banks typically do not maintain physical brick-and-mortar offices, conducting all interactions via the internet or through video calls. Users can acquire both virtual and physical payment cards, with the latter conveniently delivered to their designated home address.
  
  Among the most popular digital banking options in Portugal are N26, Openbank, and Revolut, providing modern solutions for tech-savvy individuals seeking efficient and accessible financial services.

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