Portugal - Country Commercial Guide
Trade Financing
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Methods of Payment

AnchorAnchorAnchorAnchorAnchorDepending on the size of the order and payment history of the buyer, the terms of the sale will vary. For larger transactions or where the seller is less comfortable with the credit worthiness of the buyer, foreign products are often imported using irrevocable letters of credit against documents, particularly during the first year of business. Opening irrevocable letters of credit is a straightforward process in Portugal through which importers can insure against exchange risk with their banks. When a long-term relationship has been established between a supplier and a customer, more favorable credit terms may be negotiated.

Payment terms are frequently 30, 60 and 90 days. Large corporations, including large retailers, negotiate or impose longer payment terms that can last up to six months. The government defers all payments.  Depending on the department, payments can be deferred up to one year. Product pricing must also include the necessary financial charges.

Aside from letters of credit, methods of payment most commonly used in Portugal for international trade are:

Checks (Cheques): While bank checks offer security in transactions, (since the bank issuing the check needs the guarantee of the transfer to issue it), personal checks do not provide adequate guarantees against commercial risk, as the bank does not guarantee the funds in the account of the person issuing the check.

Payment Order (Letras): In this case, the importer gives an order to the bank and, by using a correspondent bank in the same country, pays the exporter’s bank the amount due. The initiative for payment in this case is the importer’s responsibility. These transfers, via SWIFT, are a common practice in the Portuguese banking system.

Documents against payment (Cartas de Crédito): Exporters use this instrument to ensure the possession of the merchandise until the collection of funds, or at least until the importer accepts a bill of exchange.

Documentary Credit (Crédito Documentário): This method of payment offers safer conditions in the transaction, due to the involvement of banks in both countries. In this case, the importer’s bank ensures against the entrance of a third party (an exporter, the bank or a correspondent bank).

Credit Card (Cartão de Crédito) for Small Online Purchases: Even though credit card purchases over the Internet are still not widespread in Portugal, this option should not be excluded. 

A U.S. exporter looking to recover debts should contact the Portuguese Credit and Collection Management Association (APERC) for information on and contact with debt collecting agencies.

Credit reports on Portuguese companies can be obtained by contacting any of the sources below:

Dun & Bradstreet Portugal

R Barata Salgueiro 28,3º

1250-044 Lisboa, Portugal

Tel.: +351 213 500 300 Fax: +351 213 578 939


Igerinform - Relatórios de Crédito

Avenida Columbano B Pinheiro 75,7º

1070-061 Lisboa, Portugal

Tel.: +351 213 588 800 Fax: +351 213 588 801

You may also take advantage of customized credit report provided by the U.S. Commercial Service at the U.S. Embassy in Lisbon.  Our reports will help you assess the risk, reliability and capability of the Portuguese company. This service is called the International Company Profile (ICP).

For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide.

Banking Systems

AnchorAnchorAnchorAnchorAnchorThe Portuguese banking system has witnessed significant structural changes over the last three decades, with a shift from a government-controlled system to a market-driven environment fully integrated with the European Union. These profound structural and operational changes such as the abolishment of administrative interest rates in the 1980s, liberalization and harmonization in the 1990s and related implementation legislation have brought Portuguese banking regulations in line with EU legislative practices.

As a member of the EU, Portugal offers a modern banking system with advanced financial products. The country has one the most advanced inter-banking networks in the world.  ATMs and bank branches are easily found all over Portugal.  Electronic banking is widespread, and Internet banking is offered by all major banks. Major credit and debit cards are accepted in most Portuguese hotels, shops, restaurants and gas stations.

Most banks are open Monday to Friday from 8:30 am to 3:00 pm and are closed on weekends and public holidays.

The entity supervising the banking sector in Portugal is the Portuguese Central Bank (Bank of Portugal), a member of the European System of Central Banks (ESCB).

In a February 2016 post-bailout program monitoring report, the IMF warned that the Portuguese banking system’s balance sheets needed “to be strengthened to avoid further negative surprise and protect taxpayers.”  The report also noted banks need to further reduce their debt burden, which was “holding back the economy’s growth potential.”  The government has taken steps to address problems in the banking sector, facilitating the recapitalization or restructuring of four of the five largest banks in 2016 and 2017.

The largest Portuguese banks are Caixa Geral de Depósitos (CGD), BPI, Novo Banco, Santander Totta and BCP. The top five banks recorded, in the first half of 2021, an aggregate profit of 708.4 million euros. In the first six months of 2020, the five largest Portuguese banks had recorded an aggregate loss of 14.4 million euros, due to the negative results of Novo Banco (555.3 million loss). The banks lost 240 branches and 1,474 workers between the first half of 2020 and the same period for 2021, and now accounts for 2103 branches and 28227 employees.

Novo Banco, the bank that kept the healthy assets of the bankrupted Banco Espírito Santo, has proved to be particularly contentious for the Portuguese government, which has been called to inject money into it over the past few years.

According to the Bank of Portugal, the banking system’s total assets rose by 2.8%, in the first quarter of 2021. This was mainly due to a 33.2% increase in cash balances at central banks. The loan-to-deposit ratio narrowed by 1.2 p.p. reached 83.6%, reflecting a greater increase in customer deposits (2.1%) than in customer loans (0.7%). The liquidity coverage ratio increased 205 p.p., standing at 265.9%, benefiting from the performance of highly liquid assets.

Non-performing loans (NPLs) decreased by 0.3 p.p in the 1st quarter of 20219. This resulted in a decline in the NPL ratio to 4.6%. The NPL ratio net of impairments reached 2.0% (-0.2 p.p.).

In the first quarter of 2021 return on assets (ROA) increased from the first quarter of 2020, to stand at 0.4%. Return on equity (ROE) rose to 4.7%. The net result of financial operations made a positive contribution (+0.3 p.p.) to the increase in ROA. The loan loss charge decreased by 0.14 p.p. to 0.54%, reversing the upward trend seen in 2020.

The cost-to-income ratio fell 6.1 p.p. to 52.7% and benefiting from similar contributions from the reduction in operational costs and the increase in total operating income. The loan loss charge stood at 0.54%, decreased by 0.14 p.p. reversing the upward trend seen in 2020.

In the first quarter of 2021 the total capital ratio and the Common Equity Tier 1 (CET1) ratio stood at 17.7% and 12.2% respectively. The decline in both capital ratios is a result of the 0.6% rise in risk-weighted assets. The leverage ratio dropped by 0.3 p.p. from the previous quarter, to 7.4% and remained well above the minimum benchmark set by the Basel Committee on Banking Supervision (3%). This requirement will become mandatory as of the new CRR application date (28 June 2021).

Foreign Exchange Controls

AnchorAnchorAnchorAnchorAnchorThere are no exchange controls in Portugal. Portugal does not restrict currency holdings by residents or nonresidents, nor does it limit the foreign exchange supply. Residents and nonresidents are free to hold deposits in any currency with Portuguese banks. There are no official guarantees against inconvertibility.

Reporting requirements apply to banks and other financial institutions. Such institutions must provide information between March and April on their positions in derivatives and report cross-border investments and lending in excess of EUR 50 million on an annual calendar year basis.

Transactions of less than EUR 12,500 are exempt from the notification requirement. Any party that transfers an amount larger than this outside Portugal in foreign banknotes, gold, travelers’ checks or bearer securities must declare it to the Portuguese customs authority. Money laundering rules are being tightened in accordance with worldwide trends. Full information about clients, notaries, art dealers and any other entities are required when transactions of more than EUR 10,000 are undertaken. Suspicious transactions must be reported.

U.S. Banks and Local Correspondent Banks



Edifício Fundação

Rua Barata Salgueiro, 30-4º

1269-056 Lisboa, Portugal

Tel.: (+351) 21 311 63 00


JP MORGAN CHASE (former Chase Manhattan Bank)

Rua Barata Salgueiro, 30 - 3ºDto.

1250-044 Lisboa, Portugal

Tel.: (+351) 210 403 520


MERRILL LYNCH (acquired by Bank of America)

Global Wealth Management


Av. Engenheiro Duarte Pacheco, 26 6 Piso A Lisboa, 1070-110



AMERICAN EXPRESS (Credit Card Service Company)

MillenniumBCP- partner bank

Departamento American Express

Av. Professor Doutor Cavaco Silva Ed.3/2B Tagus Park

2740-256 Porto Salvo, Portugal

Tel.: 707 504 050

From Abroad: (+351) 214 278 205

For more information on the banking system please read the section Capital Markets and Portfolio Investment of the Investment Climate Statement.