Where can Spaniards open a profitable fixed-term deposit?

Economic Overview of Spain

In 2023, the Spanish economy felt the impact of several factors, including the coronavirus pandemic, political instability, and the rise in energy and food prices. These circumstances are accompanied by slowed growth, high unemployment, record government debt, and increased inflation.

In October 2023, inflation reached 3.5%, the same as in September and 0.9% higher than in August. Rising electricity, transport and food prices pushed food inflation up to 10.52% in August 2023. Despite government measures to curb inflation, taking care of one's finances remains an important task for everyone.

In this article, we will share how to find the best offers for fixed-term deposits. We will discuss why you should steer clear of Spain's largest banks, such as BBVA if you want to preserve your money at least. Let's explore where it's more profitable to open fixed-term deposits and discuss options for fixed-term deposits from banks in other European Union countries, available for online opening for Spanish citizens.

Why Open a Fixed-Term Deposit?

Fixed-term deposits represent low-risk investments, ensuring the safety of your funds and providing a stable income. This financial instrument is ideal for safeguarding your money from the impact of continuously rising inflation. At the same time, fixed-term deposits can serve as an effective means to increase savings for achieving various short-term and medium-term goals.

We have provided detailed information in our article «What is a Term Deposit?», unraveling the essence of fixed-term deposits and their advantages. After all, the deeper the understanding, the more informed and effective your choice of financial instruments.

Fixed-Term Deposits from BBVA

Let's take a look at what one of Spain's biggest banks, BBVA, has to offer.

BBVA (Banco Bilbao Vizcaya Argentaria) is one of the most popular and reliable banks in Spain, with over 3000 branches across the country. Founded in Bilbao in 1857, the bank offers its customers a wide range of financial products and services, including term deposits.

On the bank's website, you will find a single offer: a 13-month fixed-term deposit with an interest rate of 0.40% - for 13 months. This deposit is structured as a combination, with part of the funds directed to other investment sources. However, this is more of a disadvantage than an advantage.

This type of deposit is more risky than an ordinary deposit, as there is no guarantee of a return. The BBVA website even emphasizes that the return will depend on market changes. Given the current challenges in the Spanish market, it is advisable to approach this investment with caution.

If you decide to invest €50,000 in a BBVA term deposit, your guaranteed profit after 13 months will only be €87.75. Considering the annual inflation rate of 3.5%, your profit is essentially diminishing, albeit slowly. This option is not recommended for those who wish to preserve or increase their savings.

Term Deposits in Alternative Banks in Spain

There are over 150 banks in Spain that offer term deposits. Although a few large banks hold most of the assets, many smaller banks offer more favorable terms.

See for yourself: 

For the purposes of this article, we have chosen to focus only on Ordinary Deposits, which are the least risky deposits and guarantee 100% returns.

The attraction of these deposits lies not only in the fact that they prevent losses due to inflation, but also in the possibility of earning a small additional income. Let's look at the best offer from A&G Banco - a deposit with an interest rate of 4.30% for 2 years - and compare it with the BBVA deposit.

If you want to invest €50,000 and decide to open a fixed-term deposit with BBVA, you will receive a guaranteed €369 over 2 years.

On the other hand, if you open a deposit with A&G Banco with the same conditions and the same amount, you are guaranteed to receive €4,300 after 2 years.

Isn't that an impressive difference?

But what if we told you that you could open a term deposit with even more favorable conditions?

Fixed-Term Deposits in Banks of Other EU Countries

In addition to the fixed-term deposits available in Spanish banks, Spanish citizens can open fixed-term deposits in banks in other European Union countries. This option is completely legal and safe. You can find more information in our article: Online Fixed Deposits in the EU: Safe, Convenient and Secure.

As you will have noticed, the choice of banks in European Union countries is much wider than in Spain. You will also be able to find the most advantageous fixed-term deposit offers.

🔥Discover the deposits that Spaniards can open in just 10 minutes
without leaving their homes🔥

Benefits of Opening Fixed-Term Deposits Online for Spaniards

1.    Fight Inflation: With high inflation in Spain, opening fixed-term deposits online in banks in other European Union countries is an effective way to preserve the purchasing power of your money.

2.    High Interest Rates: Many EU banks offer significantly higher interest rates on fixed-term deposits than local banks, providing a more substantial return on investment.

3.    Convenience and Security: The process of opening a deposit online ensures convenience and security. Citizens can carry out all operations without leaving their homes, reducing time and risk.

4.    Wide Choice of Banks and Services: The choice of banks in the EU is more diverse, allowing customers to find more advantageous offers and to tailor their investment strategies to their needs.

5.    Long-Term Prospects: In the context of economic instability in Spain, term deposits in EU banks offer the opportunity to create a long-term financial plan adapted to changing conditions.

Bottom line

The analysis of the Spanish fixed-term deposit market shows that many banks try to attract customers with different offers. However, not all offers are equal and some may be less advantageous in the long run.

While BBVA undoubtedly has a prominent position in the Spanish financial sector, its fixed-term deposit offer is limited to a single option with an extremely low interest rate and a limited guarantee of return. In the conditions of high inflation in the country, such investments may not guarantee the proper preservation and growth of financial assets.

Comparing BBVA's offers with those of lesser-known banks, we found attractive options, such as A&G Banco's offer of 4.30% for 2 years, among others. This underlines the fact that a careful choice of bank for a fixed-term deposit can have a significant impact on your financial results.

Small banks often compete for new customers, so when the ECB raises interest rates, they raise the rates on term deposits.

As for big banks like BBVA, they cut rates because they don't need new depositors. 
If you keep your money in such a bank, you are probably getting a pitiful rate of interest on your savings and you are not even protecting your money from inflation.

Particular attention should be paid to offers from banks in other EU countries. Opening fixed-term deposits in banks in other EU countries can offer Spanish citizens not only higher interest rates, but also a variety of options, the convenience of the online process, and, most importantly, long-term prospects for preserving and multiplying savings.

Suppose you're interested in learning more about fixed-term deposits or other investment opportunities. In that case, we invite you to visit our Finding a Fixed Term Deposit page, where you can compare different offers from different banks and choose the one that best suits your needs.

You can also explore our blog where you'll find a wealth of informative articles on fixed-term deposits and financial matters. We're here to help you navigate the world of finance and make the right choices for your financial well-being.