Foreign Bank account – Its Benefits and Advantages for Business
Even though the procedure of opening a bank account abroad seems to be quite difficult, it is available to almost everyone, and moreover for both legal and physical persons, regardless of nationality and tax residence. How to become a client of a financial institution abroad? What are the main benefits of keeping money out of your own country, how to open an account and what are the requirements for its setting up for non-citizens? This article is about how to open up a foreign bank account and where to find the best place for that.
The opportunity to open a bank account abroad provides some advantages for entrepreneurs. It is about working outside the country of the main residence, since the international financial institutions, which operate in your country, are exposed to the same risks and regulations as the local financial institutions. Such a solution may be necessary for the entrepreneurs who plan to promote business up to the international stage, or for carrying out financial transactions with the partners from other countries. At the same time, this can also be a great tool for depositing and accumulation of the financial assets. It is not a secret that banks abroad often offer more favorable terms on deposits. The procedure of opening a bank account for a legal entity abroad can be divided into several successive stages, and we will consider them.
How to choose the best jurisdiction for opening a foreign bank account?
The choice of the country, where you intend to keep your financial assets, depends on your goals. For example, financial institutions in Western Europe often refuse to cooperate with non-citizens. Financial institutions of Hong Kong and Singapore are more suitable for the legal entities which operate in South-East Asia. If you are going to use the local financial institutions for the accumulation of the assets, you should remember that the deposit will be opened under the condition of the significant minimum required deposit.
The United Arab Emirates, in recent years, acquires more and more popularity. The government of this country encourages business activities in every possible way and tries to create ideal conditions for economic development, and the financial system of the country is not an exception. Today, the registration of a bank account in the Emirates is the possibility to provide asset protection at the legislative level.
In order to open an account abroad, you will need an international company registered in the relevant jurisdiction. The modern practice shows that the international and offshore companies are not always created for carrying out economic or commercial activities. Such companies are quite often used for assets management.
Choosing a foreign financial institution for cooperation, a key determinant for an international entrepreneur still is the possibility of servicing in a familiar language, in most cases, international financial services are provided in English. All the financial institutions, which offer international financial services in the UAE, offer servicing in English and the other languages.
Unfortunately, the majority of the European financial institutions impose rather high requirements to the potential clients. It is important to understand that not all the financial institutions are ready to work with foreign citizens in Europe. Local financial institutions are picky about the transparency of the financial information, as well as about information on the activities of the client.
More and more international entrepreneurs appreciate the opportunities and advantages of the Middle East. For example, in recent years, the international private business actively develops the market of the Emirates, and financial institutions in the UAE are ready to offer a wide range of financial instruments and to provide maximum protection of assets.
Considering all the conditions, the best country to open a foreign bank account is the UAE. Here you will find both low prices and easy terms of classical offshore jurisdictions and high reliability and quality of services of financial institutions in European countries.
How can I open a bank account? Requirements for foreigners
No, let’s take a look at what is foreign bank account and how to get one. The set of documents, which is required for a private or legal person may differ in accordance with the applicable legislation in the territory of jurisdiction and also depends on the internal financial institution policy. How to open a bank account in a foreign country (the UAE)? A standard set includes the following documents:
- Application (filled in due form and signed by the client);
- Copy of the identity document of the applicant (valid foreign passport);
- Statement from another financial institution, or a letter of recommendation on the applicant's name;
- Incorporation documentation for an international company.
Personal presence is a mandatory condition in the majority of jurisdictions. But in some countries, under the condition of fulfillment of all the requirements, there is the possibility of opening an account remotely.
The term of opening also depends on the internal policy of the financial institutions, there are places where you will become a client within one day, and others where you will have to wait for a few weeks.
As for the types of the foreign bank accounts, we can single out several major directions:
- Current – it is used for implementing the current payments and is characterized by the low-interest rates;
- Investment – it is applied for long-term investment projects and investments of the assets in the securities;
- Deposit – it is a perfect tool for keeping and accumulating the financial assets.
Surely, you can proceed with the whole process without assistance, but then you run the risk of losing a lot of time for studying the environment, or you can make a wrong choice and take an unfavorable decision at the very beginning. In the case of deciding without assistance, you should be ready for lengthy negotiations and numerous trips abroad. All this certainly seems difficult and raises doubts about opening an account abroad. But there is a solution – take the services of our specialized company.
We would like to note that when choosing a jurisdiction for the investment of funds, it is important to carry out a thorough analysis of your current activities and to determine the economic and financial characteristics that typify your business structure. After all, your assets should become an effective tool for achieving the strategic goals of your business.