Financial services

Spain will guarantee rural areas access to financial services

MADRID, Oct 7 (Reuters) – The Spanish government and banks agreed on Friday on a roadmap to ensure sparsely populated rural villages have access to financial services and mitigate the impact of rising mortgage costs on the poorest vulnerable.

Under the plan, all Spanish villages with more than 500 inhabitants will have at least some form of financial services outlet, be it a bank branch, ATM or mobile agency.

Banks will have six months to apply these measures, although the deadline can be extended by six months, the economy ministry said.

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Granting access to financial services is part of a plan against rural exodus, which is a major challenge in Spain, the ministry said.

It follows other initiatives by lenders to help seniors cope with the transition to online banking.

“In February, we took an important step to improve service to our elderly and disabled people and now we are taking a second step in rural areas to cover 100% of the population and territory,” the city told reporters on Friday. Economy Minister Nadia Calvino.

Villages with less than 500 inhabitants will have access to cash through rural postmen or alternative solutions, the ministry said. He did not say when this measure will be introduced.

They come as vulnerable households struggle to cope with higher interest rates.

Calvino said she would continue to work in the “coming weeks” with lenders to help the most vulnerable mortgage holders.

Changing relief measures such as extending the number of families who would be eligible to switch from variable-rate mortgages to fixed rates at no additional cost are among the options, bankers and a government source said.

An industry-wide code of practice is now already making it possible to restructure mortgages and even write off entire outstanding credit.

“We need to review this catalog of measures and, if necessary, see what improvements can be included to be able to deal with this new situation,” Calvino said.

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Reporting by Jesús Aguado; additional reporting by Emma Pinedo; edited by Inti Landauro and Susan Fenton

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