Only a bank is really a bank. Did you know that some names are “reserved”?
06/11/2025
Certain words used in a firm’s trading name can often give you an idea of the products or services it offers.
Let’s take a simple, everyday example. In Spain, if you need medicine, you go to a pharmacy. That way you can be sure that what you’re buying meets legal standards and is safe to take. But why is it that only pharmacies sell medicines and no other business can have the word “pharmacy” in its name? A shop sign need only use the word “pharmacy” to signal that it’s a regulated healthcare establishment where medicines are sold safely.
In the same way, the law restricts the use of certain names (and others that sound similar) in the financial sector to certain firms, prohibiting others from using them. Technically, these are known as “reserved names”. The purpose of reserving certain names in the financial sector is to avoid confusion, protect those using financial services and ensure that only institutions that meet the legal requirements and are supervised by the Banco de España can use them.
Words like “banco” and “bank” are examples of reserved names in banking in Spain. When you hear words like these in a name, you assume that you’re dealing with a bank that takes deposits and lends money to the public and complies with a range of legal requirements.
What reserved names does the Banco de España supervise?
The following names may only be used in Spain by institutions that are duly registered with the Banco de España:
- “Banco” (bank) and similar words (such as “banking”, “banca” (banking) and “banker”).
- “Entidad de pago” (payment institution) and its abbreviation “EP”.
- “Entidad de dinero electrónico (electronic money institution) and its abbreviation “EDE”.
- “Establecimiento financiero de crédito” (financial credit institution) and its abbreviation “EFC”.
- “Sociedad de garantía recíproca” (mutual guarantee society) and its abbreviation “SGR”.
How can I check whether an institution is authorised to use a reserved name?
You can consult the Banco de España’s Institutions Register Abre en ventana nuevato check whether an individual or firm is registered and authorised to use a reserved name. You can also verify if an individual or firm is authorised in another European Union country by consulting the national registers of other member states or the European Banking Authority’s registers.Abre en ventana nueva
What are the risks of paying for a product or service with someone using a reserved name without authorisation?
Reserved names can only be used by certain undertakings and with the prior authorisation of and registration with the Banco de España Authorised firms and individuals have demonstrated that they meet certain requirements (such as having enough capital and the appropriate organisation and resources). They are also subject to the monitoring set out in the relevant legislation.
If you place a deposit or open an account with someone who presents themselves as a “bank” without actually being one, you won’t be covered by the Deposit Guarantee Scheme for Credit Institutions Abre en ventana nueva(which guarantees up to €100,000 per depositor per institution), nor will you benefit from the transparency rules that govern banking products and services. And if you later have a dispute with them, you also won’t be able to file a complaint with the Banco de España’s Complaints Service.
If you suspect that a firm or individual is offering services without the authorisation to use a reserved name, you can report this through our external whistleblowing channel Abre en ventana nueva(link in Spanish).
