Termas de la Virgen is the classic hot-springs stop in Banos, set near the waterfall that drops behind the town. The baths are public, busy, and very much part of local life, which makes them more interesting than a private spa would be.
Go early or late if you want the best atmosphere, and expect simple facilities rather than luxury. After a day of cycling the waterfall route or hiking above town, soaking in the mineral pools is one of Banos' most satisfying rituals.