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The 21-year-old left United without making a competitive appearance but has already established himself as a key player for his new club.
It has also been claimed that Atletico Madrid and Juventus are monitoring the situation.
Given the struggles that they have faced this season, United may well regret their decision to let the player depart.
The player has gained valuable experience in the Champions League this season.
As reported by O Jogo, Real Madrid and Barcelona are both tracking Alvaro Fernandez, who now plays for Benfica.
The left-back has made seven league appearances for Benfica as well as featuring twice in the Champions League.
Fernandez, who has been capped by Spain at Under-21 level, was previously at Real Madrid’s academy before he signed for Manchester United in 2020.
He was named on the bench for United in the Premier League but didn’t feature competitively for the senior side despite being heavily involved at youth level.
During his time at United Fernandez had loan spells at Preston, Granada and Benfica before signing for the latter club permanently.