Spanish bank Santander and Elavon, a U.S. Bancorp-owned credit-card payment processor, are to jointly develop a credit and debit card payment service in Spain.

Santander, the euro zone's biggest bank, said on Friday it will own 49 percent of the venture with the remaining 51 percent held by Elavon.

The Spanish lender will transfer its domestic payment services worth 166 million euros (135 billion pounds) excluding those of majority-owned subsidiary, Banesto , to the new group.

Santander will obtain about 124 million euros gross income from the deal which, it said, it will use to help cover pending capital requirements demanded of Spanish banks against potential real estate losses.

(Reporting By Paul Day; Editing by Dan Lalor)