Opening a corporate bank account in a new market

If you are entering a new market, one of the first decisions you will need to make is how you plan to pay local employees and suppliers – and how you will be paid by customers. This decision is critical because it affects your operational efficiency, compliance with local laws, and overall business strategy.

Know Your Customer

Government legislation around the world and banking Know Your Customer (KYC) rules are becoming increasingly stringent.

Some banks will require you to have a local resident Director, registered office and proof of a local address to open an account for your business.

Anti-money laundering measures are prompting banks across the globe to request far more information, like business plans for example, and may require face to face meetings with named account holders, so planning ahead is key.

Whilst not exhaustive, the below is designed to help you prepare for the process of opening a corporate bank account.

Banks will be looking for information such as:

Company Overview & Source of Funds

• The company name and incorporation date
• Where it is based and what it does
• Reason for this account
• Names of the business owners and key members of staff
• The number of staff
• Why this business been set up / why the business exists
• The company’s targets
• Detailed breakdowns of the set up costs and mode of funding
• Current Banking Partners
• Why the company wants a business account

Nature & Details of Business

• Types of products/services the company provides
• Trading registration date and whether the company is already trading
• The number of offices and other primary locations where the company operates
• Time spent at the head office location or how long they have had the premises
• Detail plans for the future to expand into different markets, recruitment, purchasing etc.
• Names of all key suppliers and their locations of operation
• A list of the company’s main customers and location of these customers

Expected Account Activity

• Monthly turnover
• Percentage paid to shareholders
• Whether the company has a rebate scheme
• Turnover breakdown and sources
• Detail around any fluctuations and an explanation of why these have happened
• The percentage of cash, cheque/check and electronic transfers
• Details on whether the company uses cash and if so, for what reasons

As you can see, opening a corporate bank account in a new market involves navigating a significant amount of information, and the process can take months in some locations. Thorough preparation is key to expediting the setup.

By carefully considering these factors – such as understanding local regulatory requirements, selecting the right banking partner, and leveraging technology for documentation and compliance – you can streamline your financial operations. Taking these strategic steps not only accelerates the account opening process, but also ensures that your business is well-prepared to thrive in the new market.

Whatever your specific circumstances, contact us to find out how we can help you to navigate your path into a new market.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.