Banking Law and Financial Literacy Policy in the Banking Sector – Spain

Introduction

Financial literacy has become an important component of Spanish banking policy because modern consumers are expected to make decisions about bank accounts, mortgages, consumer credit, savings, investments, digital payments and increasingly complex financial products.

Financial literacy means more than knowing basic financial terminology. It includes the ability to understand interest rates, inflation, indebtedness, investment risk, contractual costs, fraud risks and the long-term consequences of financial decisions. Spain's policy combines financial education with legal duties imposed on banks concerning transparency, disclosure and customer protection.

The Banco de España and the Comisión Nacional del Mercado de Valores (CNMV) launched Spain's national Financial Education Plan in 2008. The policy has subsequently been renewed and expanded. In 2026, a new institutional cooperation framework was signed to extend financial education within the education system, while the Banco de España is developing a broader financial-education strategy for 2026–2030.

Legal and Regulatory Framework

Spain does not regulate financial literacy through one single banking statute. Instead, the policy operates through a combination of banking regulation, consumer law, securities regulation, mortgage-credit legislation and institutional financial-education programmes.

The Banco de España is particularly important for banking supervision, payment services and customer-facing banking information. The CNMV performs comparable functions concerning securities markets and investment products.

The national Financial Education Plan aims to provide citizens with the knowledge, skills and tools needed to make informed financial decisions. Its public educational programme includes materials dealing with saving, borrowing, investment, household budgeting and financial risks.

Financial literacy also interacts with EU-derived rules, including MiFID requirements for investment products, consumer-credit legislation and Directive 93/13/EEC concerning unfair terms in consumer contracts.

Financial Education Plan

Spain's Plan de Educación Financiera was established through cooperation between the Banco de España and CNMV in 2008.

Its central purpose is to improve citizens' financial knowledge so that individuals can make appropriate financial decisions throughout their lives.

Previous strategic cycles covered:

2008–2012;

2013–2017;

2018–2021; and

2022–2025.

In January 2026, the Banco de España, CNMV, Ministry of Economy, Trade and Enterprise and Ministry of Education, Vocational Training and Sports formalised a renewed cooperation framework for financial education. The agreement remains in force until January 2030 and is intended to extend financial education throughout the educational system.

The Banco de España is also preparing a 2026–2030 comprehensive financial-education strategy. Its stated priority groups include students, vulnerable groups, and SMEs and entrepreneurs.

Importance of Financial Literacy for Banking Customers

1. Understanding Credit

Customers need to understand that borrowing involves more than the nominal interest rate.

The effective cost may include interest, fees, insurance and other contractual expenses. Financial education can help consumers compare credit products and understand the consequences of late payment or excessive indebtedness.

2. Mortgage Literacy

Mortgage contracts create particularly important financial-literacy issues because they are long-term commitments.

Consumers should understand matters such as fixed and variable interest rates, reference indices, repayment periods, early repayment and associated costs.

Spanish and EU litigation concerning mortgage clauses demonstrates that contractual information must be sufficiently transparent for consumers to understand the economic consequences of important terms.

3. Investment Products

Banks sometimes distribute investment products as well as traditional banking products.

Where MiFID rules apply, financial institutions have information and assessment obligations. A customer's general financial knowledge does not automatically remove the institution's legal obligation to provide the information required by law.

This distinction is fundamental: financial education supplements consumer protection; it does not replace the bank's legal duties.

4. Digital Financial Literacy

Digital banking has created new literacy requirements.

Customers increasingly need to understand electronic payments, online authentication, digital fraud and the consequences of sharing security information.

Therefore, modern financial literacy includes both conventional financial knowledge and digital financial capability.

Vulnerable Consumers and Financial Inclusion

Financial-literacy policies can also contribute to financial inclusion.

Some customers may face disadvantages because of age, income, disability, limited digital skills or unfamiliarity with complex financial products.

The Banco de España's 2026 action plan specifically identifies vulnerable groups as a priority for future financial-education work. It also proposes evidence-based identification of vulnerable populations and pilot financial training aimed at lower-income groups.

Financial education can therefore help reduce information inequalities between financial institutions and customers.

However, banks cannot simply argue that consumers should have educated themselves. Mandatory transparency and conduct requirements continue to apply independently.

Relevant Case Laws

The following Spanish and EU cases demonstrate why financial literacy, disclosure and genuine customer understanding are important within banking law.

1. Spanish Supreme Court – Judgment of 17 April 2018 on Swaps

The Spanish Supreme Court considered swaps sold to retail customers under the MiFID framework.

The Court held that performing a suitability-related customer assessment did not by itself free the bank from its information obligations. The customers lacked previous experience and specific knowledge concerning complex financial products, while adequate prior information about the concrete risks had not been supplied.

The decision demonstrates that merely completing standardized documentation does not necessarily establish informed understanding.

2. Spanish Supreme Court – STS 3944/2019, 16 December 2019

This case concerned two swap agreements and alleged error in consent.

The Supreme Court emphasized the special information obligations applying to institutions marketing investment products under MiFID rules. The customer was not shown to possess adequate knowledge of complex products, and the contractual documentation itself was insufficiently transparent for a non-specialist.

The judgment illustrates the connection between customer knowledge and the institution's disclosure duties.

3. Spanish Supreme Court – STS 3919/2019, 16 December 2019

This dispute involved a financial derivative connected with a mortgage loan.

A central issue concerned the customer's lack of information about the potentially substantial cost of early cancellation.

The Supreme Court recognised that ignorance of how a derivative could be cancelled and the financial consequences of cancellation could constitute a legally significant mistake.

The case demonstrates why financial literacy must include understanding the economic consequences, rather than merely knowing the name or general nature of a financial product.

4. Spanish Supreme Court – STS 117/2020, 22 January 2020

This case concerned subordinated debt and alleged breach of statutory advisory and information obligations.

The litigation resulted in damages, although the Supreme Court held that returns already received from the financial product had to be taken into account when calculating compensation.

The case demonstrates that inadequate information concerning investment products can generate civil liability and compensation issues.

5. Spanish Supreme Court – STS 86/2020, 16 January 2020

This was another dispute involving subordinated debt and failures concerning advisory and information obligations.

The Supreme Court addressed calculation of damages and held that returns obtained from the product should be deducted when determining the customer's compensable loss.

For financial-literacy policy, the case reinforces the legal importance of meaningful information when complex financial products are marketed to customers.

6. Spanish Supreme Court – STS 167/2020, 3 February 2020

This case involved swap-type arrangements associated with loan instalments.

The Supreme Court addressed when the limitation period for an action seeking annulment based on defective consent begins to run. In swap relationships, the Court treated contractual completion as occurring when the contractual relationship is exhausted or terminated.

The dispute demonstrates the continuing legal consequences that can arise where customers enter complex products without adequately understanding their operation.

7. Spanish Supreme Court – Judgments 1590/2025 and 1591/2025

These judgments concerned mortgage loans using the IRPH reference index.

Following earlier Court of Justice of the European Union rulings, the Spanish Supreme Court explained that transparency and unfairness require examination of the circumstances of the individual loan. It provided guidance for determining transparency and, where transparency is lacking, assessing whether the clause is unfair.

These cases demonstrate that financial information must enable consumers to understand economically significant contractual mechanisms rather than simply presenting technical terminology.

Financial Literacy and the Duty of Banks

An important legal principle emerging from these cases is that financial literacy operates on two levels.

The first is consumer capability. Individuals should develop sufficient knowledge to compare products, ask relevant questions and recognise financial risks.

The second is institutional responsibility. Banks must comply with disclosure, transparency, suitability, conduct and consumer-protection requirements applicable to the particular product.

A financially educated customer therefore does not automatically release a bank from statutory obligations.

Likewise, a customer's signature on a contract does not necessarily establish that complicated financial risks were adequately explained.

Financial Literacy and Mortgage Transparency

Mortgage litigation has had an especially important influence on Spanish consumer banking law.

Transparency requires more than grammatical clarity. For important contractual provisions, consumers may need sufficient information to understand their practical and economic consequences.

Recent Spanish Supreme Court decisions continue to emphasize individualized examination of mortgage clauses. For example, its 2025 jurisprudence concerning mortgage opening fees states that there cannot necessarily be one automatic answer concerning validity; transparency and unfairness must be assessed according to the relevant contractual circumstances and evidence.

This approach supports the broader policy objective of meaningful rather than purely formal consumer understanding.

Financial Literacy and Financial Stability

Financial education also has a broader systemic function.

Consumers who better understand borrowing, saving, investment diversification and financial risks may be better equipped to avoid unsustainable financial decisions.

A 2026 Banco de España evaluation described financial education as relevant not only to individual welfare but also to responsible financial behaviour and financial stability.

For this reason, financial literacy increasingly forms part of the wider relationship between consumer protection, inclusion and financial-system resilience.

Current Policy Direction

Spain's policy is increasingly moving toward targeted education rather than relying only on general public information.

The Banco de España's 2026–2030 strategy under preparation identifies three broad priority areas: education-sector participants, vulnerable groups, and SMEs and entrepreneurs.

The renewed institutional agreement signed in January 2026 also strengthens the connection between financial education and Spain's formal educational system.

These developments show that financial literacy is increasingly regarded as a long-term public policy issue rather than simply a matter for customers immediately before they purchase a banking product.

Conclusion

Financial literacy policy in Spain's banking sector combines education, banking transparency, consumer protection and responsible financial decision-making.

The Financial Education Plan established by the Banco de España and CNMV provides the principal national institutional framework. In 2026, Spain strengthened that framework through renewed cooperation with government ministries and through preparation of a Banco de España financial-education strategy for 2026–2030.

Spanish banking and investment jurisprudence demonstrates an equally important principle: financial education cannot substitute for the legal responsibilities of financial institutions. Banks must still provide legally required, clear and meaningful information concerning financial products and their risks.

Cases involving swaps, subordinated debt, mortgage derivatives and IRPH clauses demonstrate the practical importance of customer understanding. Consequently, effective Spanish financial-literacy policy rests on two complementary foundations: better-informed consumers and properly regulated financial institutions.