Banking in Ecuador Explained

Ecuador's banking system is surprisingly modern and efficient, despite the country's relatively small size. Ecuador has a well-developed banking system with a wide range of services.

You can easily find an ATM in major cities and tourist areas, and many banks have 24-hour customer service. Ecuadorian banks also offer online banking, mobile banking, and phone banking services.

Ecuador is a member of the Latin American Integration Association (LAIA), which facilitates financial transactions between member countries. This means you can use your debit or credit card from your home country in Ecuador.

Having a bank account in Ecuador is a must if you plan to live there for some time.

The main benefit of having a local Ecuadorian account is to use the country's transferencia system to transfer money to other people.

You'll also find it easier and cheaper to pay bills, such as electricity and Internet bills, with a local bank account.

Ecuador's interest rates are far higher than U.S. interest rates, making it an attractive option for investors to put their money into bank CDs for higher interest rates.

One advantage of Ecuador's banking system is that it uses the U.S. dollar as its official currency, eliminating worries about currency devaluations or foreign exchange fees.

Ecuador's banking system is quite unique and efficient, especially when it comes to transferring money. You can pay people throughout the country, regardless of their bank, thanks to the Transferencia system.

One of the standout features of Transferencia is instant account verification before sending. This is because the system is at the bank level, so you can simply type in the recipient's bank account number into the app and verify the account holder's name. This ensures you typed in the bank account number correctly.

Almost everyone in Ecuador is eligible to receive money using the Transferencia system, as long as they have a bank account. This is because the system is built into the existing bank infrastructure, making it very common to see businesses and small vendors post their bank account information in public.

If you're looking for an international bank in Ecuador, there's only one option: Citibank. However, there are numerous reliable local banks to choose from, including Banco Pichincha, Banco del Pacífico, Banco de Guayaquil, Produbanco, and Banco Internacional.

Ecuador's System is a game-changer when it comes to transferring money. Almost all Ecuadorian banks are connected via the transferencia system, allowing you to pay people throughout the country, regardless of their bank.

The system is built into the existing bank infrastructure, making it very common to see businesses and small vendors post their bank account information in public. This is especially convenient when you don't have cash or a credit card.

One of the best features of the transferencia system is instant account verification before sending. You simply type in the recipient's bank account number into the app and verify the account holder's name. This ensures you've typed in the correct account number and prevents any potential issues.

However, there is a small fee for interbank transfers. If you and the recipient have accounts at different banks, there's usually a fee of around 50 cents per transaction. While this isn't a huge burden on its own, it can add up over multiple transactions.

In some cases, the system can be a bit unreliable. I've personally experienced issues where the system goes down randomly, requiring me to try again later. But these instances are relatively rare, and the convenience of the system far outweighs the occasional glitch.

Here are some key benefits of Ecuador's transferencia system:

In Ecuador, the main day-to-day bank account is a savings account, not a checking account like in the United States. Checking accounts are for businesses.

You can open a bank account in person at a branch, and you'll need to provide identification documents such as a passport or ID. You may also need to provide proof of address and proof of income.

Ecuador has different types of bank accounts, including a "transactional" savings account, which is like a U.S. checking account in all but name. This account will be your main bank account, and you'll use it to pay bills, perform transfers, and have a debit card linked to it.

There's also a "scheduled savings" account designed to help you save for a big purchase. You agree to contribute a certain dollar amount per month and not touch the money for a certain period of time, and in exchange, the bank gives you a higher interest rate than a regular savings account.

Here are the main bank accounts in Ecuador:

These accounts offer various benefits, such as higher interest rates and convenient access to your money.

Deposit insurance is a crucial aspect of Ecuador's banking system. Ecuador's bank deposit insurance scheme caps out at $32,000 per depositor, with some banks offering as little as $1,000.

You can check the deposit insurance amount for your bank or co-op on COSEDE's website. Simply start typing the name of the bank into the field, and click the little padlock icon to the left of the name to see the insurance amount in the pop-up window.

As a joint account owner, you don't get twice as much deposit insurance just because it's a joint account. We asked our bank this question and were told that we could create two different accounts, each with one of us as the primary owner, to be covered for $32,000 each.

Ecuador's deposit insurance organization, COSEDE, is similar to the FDIC in the United States. You can read more about Ecuador's deposit insurance on COSEDE's website, and search for any bank or co-op in Ecuador to see how much deposit insurance they offer.

Ultimately, deposit insurance is only as good as the entity insuring the deposits. Ecuador's government has been running a large budget deficit and needed IMF help as recently as this year, which raises questions about their ability to cover deposits in the event of a large bank failure.

Banco Pichincha is the largest bank in Ecuador and has a presence in several countries, including Peru and Panama, with a location in Miami for banking help while in the United States.

Its ATMs are ubiquitous throughout Ecuador, making it a convenient option for accessing cash.

Banco Pichincha has a user-friendly mobile app that works relatively well, allowing you to manage your account on the go.

One unique feature of Banco Pichincha is that it's (somewhat) easier to transfer money from the United States, but be aware that this method may not always work due to security concerns.

If you don't have your Banco Pichincha debit card, you can still withdraw money from any Banco Pichincha ATM using your phone, thanks to their Cardless ATM Withdrawals feature.

Here are the steps to use Cardless ATM Withdrawals:

Banco del Pacífico is Ecuador's most profitable bank in 2023 and 2024.

They have a large network of locations and ATMs, making it a convenient option for many Ecuadorians.

The bank is known for its professional service, which is impressive considering the long lines that often form at their branches.

You'll likely become familiar with Banco del Pacífico if you apply for residency in Ecuador, as the Immigration and Education ministries bank with them.

We personally experienced the long lines at Banco del Pacífico, often waiting to pay small government fees.