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Why you should be careful if your Spanish bank offers you a ‘revolving’ card

The Bank of Spain is reporting a spike in the number of complaints from bank customers who are being charged sky-high interest for using a particular type of credit card. What is a ‘revolving’ card and do you unknowingly have one?

Published: 17 January 2022 12:37 CET
revolving credit card spain
Spanish banks don't refer to these credit cards as 'revolving' so it isn't always easy to know that you have one until you've been overcharged. Photo: Ahmad Ardity/Pixabay

‘Tarjetas revolving’ are a type of credit card offered by banks in Spain, a complex financial product which is giving many bank customers a nasty surprise.

Spain’s banking system has adopted this anglicism even though the term ‘revolving card’ isn’t really used in English-speaking countries (revolving credit is, as is evergreen loan). 

The ‘revolving’ system allows a bank customer to delay and split payments for purchases they make with their ‘revolving’ credit card. 

However, instead of having to pay the full amount owed at the end of the month as with credit cards, the payment is made in smaller monthly instalments that generate a lot of interest – often 25 percent a month – something thousands of Spaniards are now saying they weren’t told by their banks.

If for example, you used a ‘revolving’ credit card to make a purchase worth €1,000 and your contract states that you need to pay it back in 40 instalments (€25 a month instalments) with 25.6 percent interest for each, by the time those 6 years and 10 months had elapsed you would have paid more in interest – €1,031 – than for the initial payment.

In its roundup of banking complaints in 2020 published in early January 2022, the Bank of Spain reported a 138 percent rise in the number of fraudulent credit card charges compared to the previous year, and 212 percent when it came to revolving cards specifically.

Most disgruntled customers slam the lack of information provided about the consequences of using these cards, which for Spanish legal complaint firm Reclama Por Mi demonstrates the “malpractice” of Spanish banks with these products, adding that 62 percent of the complaints they deal with relate to ‘revolving’ credit cards. 

“Sometimes bank customers have no choice but to continue using the ‘revolving’ cards that they have in order to meet expenses, and by doing so they keep being charged exorbitant interest, which means that the debt is barely paid off,” Director of Operations Javier Moyano told Spanish daily La Información.

To be clear, Spanish financial entities do not refer to these credit cards they offer as ‘revolving’, so you won’t automatically know that you have one. 

In order to know if you have one, you will have to read your contract’s smallprint, pay special attention to the TIN or TAE interest rate (the annual percentage rate in English – APR), the number of instalments and so on. 

In early January, the Bank of Spain ruled that financial entities in the country will have to provide the client with simulations of how much it really costs to obtain this type of credit that generates double-digit interest in most cases.

It follows an earlier decision by Spain’s Supreme Court in 2020 that ruled that Spanish banks could no longer charge more than 27 percent interest on revolving credit card purchases.

But it seems likely that financial entities in Spain will still find ways to get customers to accept this type of credit card without them really knowing what they’re getting themselves into. 

READ ALSO:

The safest way to avoid any nasty surprises altogether is by only owning a debit card if that’s financially possible for you, or making sure that you ask your bank manager as soon as you get a new credit card ¿Es una tarjeta de crédito normal o una revolving? (Is it a normal credit card or a revolving one?). 

It may also be that you have a revolving credit card and have only just found out that you’re being charged hefty interest, in which case you should know you can complain to your bank and try to reach an agreement outside of court, or you can claim through the Bank of Spain or through the courts.

According to Spanish law firm Rico Sánchez Abogados, who can help to lodge a complaint against banks who are overcharging customers, ‘revolving’ cards offered in Spain are the following (tarjeta means card in Spanish) :

Revolving Wizink cards: Tarjeta Visa Classic Popular-e, Tarjeta Visa Oro Popular-e, Tarjeta Visa Classic Citibank, Tarjeta Visa Oro Citibank, Tarjeta Citi Classic, Tarjeta Citi Twin, Tarjeta Barclaycard Oro, Tarjeta Pass Carrefour, Tarjeta Visa Cepsa, Tarjeta Iberia

Revolving Bankia cards: MasterCard: Tarjeta MasterCard Champions. Visa: Tarjeta Visa Compras, Tarjeta Visa Crédito Particulares, Tarjeta Visa Crédito Plus, Tarjeta Visa Dual Plus, Tarjeta Visa Flexible, Tarjeta Visa ON, Tarjeta Visa Oro

Revolving BBVA cards: MasterCard: Tarjeta MasterCard Negocios, Tarjeta MasterCard Infinit Oro. Visa: Tarjeta Visa A Tu Ritmo, Tarjeta Visa A Tu Ritmo Blue, Tarjeta Visa Después, Tarjeta Visa Después Blue, Tarjeta Visa CX Oro, Tarjeta Repsol más Visa, Tarjeta Iberia Classic, Tarjeta Iberia Icon, Tarjeta Dorada Renfe, Tarjeta Motor+, Tarjeta Viajes+

Revolving BBVA Consumer Finance cards: MasterCard: Tarjeta Mastercard Travel Club. Visa: Tarjeta Visa Club Vips, Tarjeta Visa Consum, Tarjeta Visa De Compras. Tarjeta Affinity Card

Revolving Caixabank cards: MasterCard: Tarjeta MasterCard Estrella, Tarjeta MasterCard Oro. Visa: Tarjeta Visa Classic, Tarjeta Visa Gold, Tarjeta Visa Gold Flexible, Tarjeta Visa Imagin Crédito, Tarjeta Visa Oro, Tarjeta Visa Platinum, Tarjeta Visa Platinum Gold, Tarjeta American Express Amex Plus, Tarjeta American Express Plus

Revolving Caixabank Consumer Finance cards:Tarjeta Mediamarkt, Tarjeta Ikea, Tarjeta Fnac, Tarjeta Lecrerc

Revolving Banco Sabadell cards: MasterCard: Tarjeta MasterCard Classic, Tarjeta MasterCard SIN, Tarjeta MasterCard Oro. Visa: Tarjeta Visa Classic, Tarjeta Visa SIN, Tarjeta Visa Oro, Tarjeta Visa Shopping Oro, Tarjeta Visa Platinum

Revolving Banco Santander cards: MasterCard: Tarjeta MasterCard Box Gold, Tarjeta MasterCard Día a Día, Tarjeta MasterCard Santander 123, Tarjeta MasterCard Santander 20, Tarjeta MasterCard Santander Plus. Visa: Tarjeta Visa Classic, Tarjeta Santander PRIME, Tarjeta Mundo 1|2|3, Tarjeta Mi Otra 1|2|3, Tarjeta Zero 1|2|3, Tarjeta Mi Otra Zero 1|2|3, Tarjeta Iberia Classic, Tarjeta Iberia Icon, Tarjeta LaLiga Santander

Revolving Openbank cards: Tarjeta Visa 123, Tarjeta Visa Classic, Tarjeta Visa Oro, Tarjetas 

Revolving Santander Consumer Finance cards: Tarjeta Visa Light, Tarjeta Visa Box, Tarjeta Worten, Tarjeta General Óptica

Revolving Oney cards: Tarjeta Leroy Merlin, Tarjeta Alcampo, Tarjeta Decathlon, Tarjeta AKI, Tarjeta Simply

Revolving Abanca cards:Visa: Tarjeta Oro, Tarjeta Clásica, Tarjeta Clip, Tarjeta Proyecto

Revolving Unicaja cards: Visa: Oro, Classic, Tarjeta Gold, Tarjeta Platinum, Tarjeta Blue

READ ALSO: Is it worth reporting your Spanish bank for misconduct and how do you make a successful claim?

Revolving Bankinter and Bankinter Consumer Finance cards: Bankinter: Tarjeta Visa Única (Clásica y Oro), Tarjeta Visa Quiero. Bankinter Consumer Finance: Tarjeta Bankintercard Oro, Tarjeta Bankintercard Platinum, Tarjeta Visa Coinc, Tarjeta Visa Air Europa, Tarjeta Visa Vodafone, Tarjeta Visa BP, Tarjeta Línea Directa, Tarjeta Halcón Viajes, Tarjeta Renault

Revolving Barclaycard card: Tarjeta Visa Classic, Tarjeta Visa Oro, Tarjeta Visa Barclaycard

Revolving EVO Banco y EVO Finance cards: EVO bank: Tarjeta Visa Classic, Tarjeta Visa Extra, Tarjeta Visa Oro, Tarjeta Visa K26+, Tarjeta Mastercard Evo Crédito. EVO Finance: Tarjeta Visa EVO Finance Classic

Revolving Deutsche Bank cards: Tarjetas Visa: Familia, Shopping, Preferente y Preferente Oro, Tarjeta MasterCard Premium Gold, Tarjetas Revolving Cetelem.

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LIFE IN SPAIN

EXPLAINED: How to buy a boat in Spain

Considering buying a boat to enjoy life to the fullest in Spain? Here's a breakdown of costs, legal requirements, financing options and useful tips to factor in before purchasing a bowrider, a day sailer, a yacht or any other 'barco'.

Published: 3 May 2024 12:18 CEST
EXPLAINED: How to buy a boat in Spain

Spain has around 8,000km of coastline, and access to the Mediterranean, Atlantic, and Bay of Biscay. For boat enthusiasts, you’re spoilt for choice in Spain.

But it’s not just as simple as picking out a boat, buying it and setting off into the ocean.

There are several decisions you’ll need to make first, rules to follow, administrative hoops to jump through, and then maintenance costs on top of that.

Types of boats

The first thing you’ll need to consider is the type of boat you want to buy.

Generally they can be split into two broad categories: motor boats and sailing boats.

Motor boats are the most popular type of boat sold and offer the greatest variety of options because they include pretty much everything from smaller more affordable power boats to huge luxury yachts.

As such, you could get a smaller motor boat, say for day trips of fishing on the coast, for as little as €10,000, whereas yachts, as you can imagine, can cost millions, depending on the size, power, design and quality of the boat.

According to several Spanish maritime sources, buying a used boat that you can live on in Spain can cost anywhere between €13,000 and €150,000.

Spanish website topbarcos.com has hundreds of boats listed for you to get an idea of what’s available in the second-hand market, as well as a page for new vessels.

Sailing boats are the more environmentally friendly option and require the most skill to sail, and include light sailboats, catamarans and trimarans. Again, prices vary from €5,000 to over a million, depending on the size, type of sail, material and quality of the boat.

Once you’ve decided on the type of boat you want and found one you’d like to buy, you’ll need to consider any potential legal requirements.

A woman sits next to a yacht in Puerto Banús luxury marina in Marbella. (Photo by JORGE GUERRERO / AFP)

What are the legal requirements when buying a boat in Spain?

  • The correct nautical qualifications for the type and size of the boat you want to buy. There are different types of nautical licences to sail different boats in Spain, such as the PNB (Basic Navigation Skipper), the PER (Recreational Boats Skipper), the PY (Yacht Skipper) or the CY (Yacht Captain). Each has specific limitations in terms of length, power, distance from the coast and the type of sailing you can do.
  • Compulsory civil liability insurance that covers possible damages that you may cause to third parties with your boat.
  • Have all the necessary documentation for the boat, such as the certificate of seaworthiness and (essentially an MOT for the boat, showing that it’s in working order) and the navigation permit.
  • You’ll also need to pay the corresponding taxes on the boat purchase, such as VAT (21 percent), the special tax on certain means of transport (12 percent) or the transfer tax (4 or 6 percent, depending on the region).

READ ALSO: How do I get my boat licence in Spain

What other factors should you keep in mind before buying?

Think about what type of navigation you want to do, how often, with how many people and what your budget is. 

Don’t go with the first boat you see. Search and compare different models, brands, prices, conditions etc and don’t forget to keep an eye out for scams.

It’s a no-brainer but try the boat before you buy it, don’t just rely on photos or descriptions. Request a test ride to check the condition and navigational operation of the boat. 

If you do not have much experience or knowledge of nautical matters, it’s advisable to hire a professional to accompany you throughout the purchasing process. It could help you avoid possible legal, technical or administrative problems that arise.

They will also assist you with checking the condition of the boat’s interior: the carpentry, the engine, the electrical installation, the tanks, bilge, kitchen, bathroom and other compartments.

Here is a list of dozens of Spain-based brokers (as they’re called) or nautical companies that can assist you. 

Crucially, they will also be able to give you an informed assessment of what price you should be paying for the boat you’ve chosen. 

How can you pay for a boat?

Unless you have enough disposable income to pay for it cash, you probably want to know what kind of financing is available to you. 

There is the nautical mortgage (hipoteca náutica), which mimics the system for property mortgages, including the need for a down payment and embargo conditions in non-payment situations. 

Nautical credits (Créditos náuticos) also exist, which again are not too different from regular loans, including fewer notary costs than nautical mortgages and fixed interest rates. 

And lastly, nautical leasing is also an option, which is when a company acquires a boat and rents it to a customer for a certain period of time (normally between 4 and 15 years) and usually with an option to buy at the end of the contract.

Don’t forget the upcoming maintenance costs

If you manage all that and buy the boat, you’ll need to maintain the boat and pay costs to do so. These include:

The mooring: ie. the place where the boat is left when it is not in use. The price of mooring depends on the size of the boat and the location of the port. It can range from around €100 per month to several thousand.

However, be warned, in Spain these aren’t easy to come by. The Association of Industries, Commerce and Nautical Services (ADIN), estimates that Spain has only 107,894 moorings for 229,000 boats.

You’ll also need to pay for periodical technical checks that must be carried out on the boat from time to time to check its condition and operation. Again, the price depends on the type and size of the boat and the services contracted. It can vary from around €200 euros to several thousand.

Regularly cleaning the boat to avoid dirt, rust, algae, and parasites damaging the boat can also be quite costly. It can vary from as little as €50 for smaller boats to several hundred for bigger ones, and most experts recommend it should be done every 4-6 weeks.

READ ALSO: How to live on a boat in Spanish waters

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