The modern financial system involves difficult solutions and operations based on the system of payments and mutual financial settlements. Bank accounts are a vivid example of one of such mechanisms. In today's market, almost all the firms and companies have a bank account for the payments. Such situation is primarily caused by the importance of availability of a bank account for prompt and proper functioning of the company. Thereupon, the issue of opening a bank account in the foreign banking institutions remains highly relevant. Over such bank account, a company receives timely and regular financial services, what allows building the most effective business.
The account in a foreign bank: recommendations and guidance
For foreign banking and credit institutions, the basis of building relationships with clients is the principle "Know Your Client" (Know your customer). Today it is the main principle of operating of almost all the international banks, regardless of the legal status and geographical origin of the financial institution. Before the start of cooperation with the foreign client, the “Due diligence procedure” is done, which involves the verification of the information provided by a client.
Due diligence procedure - what is its essence
In fact, the Due Diligence procedure involves verification of the following information about a potential client:
- Legal and juridical status of the potential client;
- The main source of origin of the financial assets;
- What scheme of financial settlements is planned within company's activities;
- What is the anticipated turnover of the company;
- With whom the company plans to work and cooperate;
- What banking solutions and products are required by the company.
The international experts note that in recent years that the requirements of international banking institutions to the potential customers become more and more stringent. First of all, it is reflected in the list of the documents required for opening a bank account. For example, if earlier the set of documents included the incorporation documents and a foreign passport, it will not be sufficient nowadays.
Requirements of the international banking institutions
If trying to out together a main table with the essential requirements of the international banking institutions to the potential clients, the following issues can be singled out:
- The purpose of opening of a bank account in a foreign bank;
- Type of the economic and commercial activity of the potential client;
- Financial turnover of the company;
- Business partners of the company;
- Comprehensive information on the ultimate beneficiaries, including information about the origin of the financial assets, professional education and experience of the founder, tax residence and etc.;
- Signing of the relevant banking documents and forms for opening an account;
- Placing a minimum deposit to the opened account.
Choice of the appropriate bank
An entrepreneur, who plans to open a bank account in a foreign bank, must understand that the choice of the relevant institution and the account opening procedure has a number of complications. First of all, one needs to choose a financial institution, because this banking institution should be the most convenient, comfortable for work and possess the acknowledged authority among the players of the financial market.
The confidentiality and security of information about the ultimate beneficiaries and the owners of the business is not of less importance. Besides, you must clearly define the goals of business and economic activities. Based on it, you'll get a clear understanding of why do you need a bank account in a foreign bank, and what functionalities it is expected to fulfill, and etc.
For example, if the future business structure assumes the establishment of international trade relations, it is correct to open a bank account with a convenient and easy internet access. Besides, the foreign banking establishment should possess the relevant business reputation and services, proven in practice.
Useful fact:
The experts and financial analysts state that for maximum effectiveness, and insurance of business from unpleasant surprises, it is better to open accounts in several foreign banking institutions. Besides, it is recommended to keep the financial assets and savings in multiple currencies.
Opening a bank account: what to pay special attention to
When opening a bank account in a foreign bank, a special attention should be paid to the following aspects and features:
- Economic and political stability on the territory of the country where the financial institution is located;
- Indicators of reliability and prestige of the bank;
- The degree of state control when executing financial transactions;
- List of the financial instruments and proposed banking services;
- Tariff policy and the costs of provision of the services;
- Requirements to the potential client and the complexity of the procedure of opening an account.
Conclusions:
Opening a bank account in a foreign bank without assistance is thinkable, but it will be quite difficult. You should have some knowledge and understanding of the current offer of the financial market in order to choose the best option of the financial institution and type of bank account.
The solution of this issue may be the help of the qualified staff, who has many years of experience and the database of the best banks. Usually, it allows to select the optimal solution for the client, considering all the client’s requirements and business features. You will be spared the negative consequences of wrong decisions and surprises from a foreign bank owing to the extensive experience. Use the contact us form and get a free consultation today.
