Getting Ready to go Cashless in Spain

A cashless society isn’t a society with no cash in it, but rather one where cash is irrelevant. Like it or not, we’re being pushed towards going cashless with fewer bank branches and ATMs and higher charges for using cash.

Not everyone can, or wants, to pay by card. However in some regions in Spain over 20% of the population doesn’t have access to a bank branch. In the last 10 years nearly 20,000 branches have been closed across the country, and it’s not only rural areas that are affected.

As well as fewer bank branches the number of cash machines is at its lowest level ever leading to difficulties in getting hold of cash.

Preparing yourself to go cashless

Even if you don’t agree with going cashless, it makes sense to be prepared:

  • Plan your cash withdrawals to minimise commission (some banks don’t charge on withdrawals of 200€ and above)
  • Get a credit card with no annual fee
  • Learn how to pay with your mobile

But we should still be somewhat wary of tech, given the major problems that arise when systems crash. Keep a basic record of your assets – sometimes you might need a fallback solution.

What to do about coins?

If you budget using the jam jar approach, or save your spare coins in a piggy bank, bear in mind that when you take the coins to your Spanish bank some may charge you for counting them (even if you have an account with that branch).

One major bank in Spain charges 10€ to deposit up to 499 coins and another 10€ for every 500 additional coins!

Play your cards right

In order to go cashless, you may need to rethink your debit and credit card strategy. Start with these tips:

  • Consider whether the perks offered, if any, are worth the annual cost of the card. If not, cancel and get a free one from another provider.
  • Many banks offer personalised debit cards, for example with your photo or a picture of your pet, but there may be a charge.
  • Surcharges for paying by credit or debit card are not allowed in the EU. If you buy from outside the EU you may have to pay more when paying by card.
  • Don’t save your card details on a website for future purchases. Uncheck the tick box and input your card details again in the future.
  • Using a card when travelling outside the eurozone may be cheaper than exchanging cash. Compare your card commission rate (normally between 1% to 3%) to currency exchange rates. You could also get a multi-currency card (see below).
  • When using your debit card at an ATM that doesn’t belong to your bank, you may be charged. You must be informed of any charge during the transaction in order to accept it or cancel the withdrawal.
  • Don’t use your credit card at an ATM to withdraw cash – you’ll be charged interest from the date of withdrawal until the date you settle your credit card bill.

You can find more info in these articles: No annual-fee credit cards in SpainPrepaid Cards in Spain: Pros and ConsMulti-Currency Accounts and Cards.

Paying with your phone

Use of mobiles and wearables to pay is also on the increase. Remember to take some basic security measures such as keeping the operating system and apps updated and use inbuilt security features such as facial or fingerprint recognition.

Apply Pay, Google Pay and Samsung Pay all securely store your credit card details. To pay, just unlock your phone and tap it on the terminal in any store that accepts contactless payments.

With payment by phone or smartwatch your name and 3-digital security code won’t be visible. This makes it more difficult for someone to get hold of your full card details to use them fraudulently.

In the case that your phone/watch is stolen, log in to your account from another secure device and deactivate all the cards held in your digital wallets.

Cashless = easier budgeting?

When all your payments are digital, you may find it easier to budget. Choose a budgeting app, link it to your bank and credit cards and check regularly. You may be surprised by how quickly your purchases add up! If that’s the case, consider where you could cut back.

Cashless = no anonymity

One major drawback to going cashless is that it means all payments are traceable. Remember that in Spain payments in cash are limited to 2500€ and you can’t divide an invoice that’s above that amount in order to make two or more cash payments.