Recently, Ukrainian individuals and legal entities have often been interested in opening an account in a foreign bank. Since the beginning of the global pandemic, more and more people from our country seeking answers to this question have turned to the Lawrange Law Association. Considering the steadily deteriorating political situation and growing hotspots of military conflicts worldwide, professional services to assist in opening a bank account have become even more in demand.

 

The need for a bank account can be driven by various reasons, ranging from personal pursuits, such as paying for a child’s education in a foreign university, to implementing corporate, investment, and other tasks. In any case, opening an account in a foreign bank proves to be a handy and effective tool. However, searching for and establishing cooperation with a banking institution has become significantly more complicated recently.

 

If, in the past, foreign financial institutions competed among themselves to attract more clients by creating favorable conditions and offering bonuses, today, they adhere to a completely different policy. Now, for most banks (especially European and American ones), it is crucial, first and foremost, to comply with measures against money laundering and counterterrorism (AML/CFT). The Know Your Customer (KYC) policy thoroughly examines every potential user based on various parameters. The bank will only approve your application if you have met all requirements. In this article, we want to discuss whether it is possible to open a bank account abroad and, if so, where it is best to do so and what factors to consider.

 

Why Are You Opening an Account?

This is the exact question that foreign banks ask everyone wishing to avail themselves of their services. You should give an objective and well-founded answer. Various reasons can serve as a basis for opening a foreign account. Below, we suggest you familiarize yourself with the most popular ones.

 

Important! There are no restrictions for individuals and legal entities from Ukraine to open a foreign account. Moreover, you can open any type of account – currency, settlement, savings, etc.

 

Family Living Abroad

Today, several million Ukrainian refugees reside in EU countries, prompting some European banks to offer Ukrainians special conditions for opening personal accounts. This initiative aims to facilitate their ability to make international transactions or receive financial support from relatives.

 

Many of our people find themselves abroad with their entire family, whether forced or intentional. Additionally, immigrants from other post-Soviet countries often open businesses. Residing in European countries with spouses, children, and parents necessarily involves the need to open a personal account for payment of goods, services, cash withdrawals, etc. When obtaining a residence permit, permanent residency, or citizenship, opening an account makes mortgage benefits and other financing available.

 

Studying Abroad

This process is impossible without a local bank account, as you need to ensure payment for your child’s education, accommodation, or other expenses. It is recommended to open an account in a real bank rather than a payment system when your child is studying at a university. It’s also a good idea to open a joint account with parents or relatives, enabling free transfer of funds.

 

Buying Property Abroad

This process involves the obligation to pay property taxes and utility bills (usually automatically debited from the personal account). You should sign a contract with a bank that cooperates with your real estate agent. In this case, you may expect the possibility of mortgage arrangements, characterized by long terms and lower interest rates compared to Ukraine, for example.

 

Investing

An investment account in a bank allows you to buy and sell securities, either online or through trust management, providing investment strategies for your personal use. Ensuring that the bank offers such an option is crucial for trading in complex instruments (including non-market securities).

 

When investing, you need to at least pay fees for holding securities (up to 0.4% of the amount per year) and buy-sell fees – fees incurred when buying or selling securities (1-1.5%). Entrusting money for management will also require an additional payment of 1% or more. In other words, there are associated costs in addition to account maintenance expenses. The applicant needs to have an appropriate level of qualification, confirmed by:

 

  • Conducting investment operations amounting to more than 500,000 euros.
  • Buying/selling a certain quantity of securities within a specified period.
  • Investor certificate.

 

Opening investment and savings accounts in foreign banks is a strategic step for those who aim to increase their capital at a global level.

 

Opening an Account for a Foreign Company

A widely sought-after task for owners of legal entities registered in any foreign jurisdiction. In this case, the account is used for:

 

  • Contributing minimum authorized capital.
  • Conducting transactions (depending on the company’s activities).
  • Organizing payment for services and goods in the country’s national currency where the company is registered.
  • Managing financial assets abroad.
  • Creating a financial cushion – protecting the business in case of account freezes in the home country, etc.

 

Opening an account for an offshore company in most European banks can be a complex task. This is only possible if the applicant invests in the bank’s products or maintains a substantial non-reducible balance.

 

Important! Regardless of geography, banks universally adhere to the Know Your Client (KYC) standards when opening individual and corporate accounts.

 

Advantages of Opening an Account in a Foreign Bank

Convenience is one of the main advantages. Having an active account in a country where, for example, you need to pay utility bills, receive business profits, or purchase goods and services ultimately makes it much more convenient to work, travel, or reside. This option often simplifies various tasks. Regardless of the frequency of movement between different countries, keeping your funds in a foreign account provides government guarantees of reimbursement in the event of the bank’s bankruptcy. There are also other reasons to open an account in a foreign bank.

 

The Opportunity to Diversify Assets

Storing funds in multiple jurisdictions reduces the risk of economic or political instability in one country. An account in a foreign bank allows you to hold funds in different currencies, protecting your assets from fluctuations in exchange rates.

 

Free Access to International Markets

A foreign bank account is an effective tool for conducting transactions in the local currency. It is particularly useful for legal entities engaged in international trade and investments. Additionally, some foreign banks offer exclusive investment options, allowing you to freely enter markets with potentially higher returns.

 

With a foreign bank account, you will find it much easier to locate business partners. During such collaborations, problems with transferring money between your accounts are almost reduced to zero. Notably, the opening of a bank account is often consciously carried out by many entrepreneurs long before they start looking for partners abroad.

 

Confidentiality and Data Security

In some jurisdictions, stricter privacy laws are in place to protect your financial information from unauthorized access. Depending on the chosen country, data on financial activity and transactions may remain more secure than domestic accounts.

 

Access to Effective Tax Planning

A foreign bank account helps plan personal taxes and inheritance. The benefits applicable in each specific case will depend on individual circumstances, such as country of residence, legal form of the business entity, type of activity, and more. In most cases, entrepreneurs can take advantage of the opportunity to reduce the tax burden on their businesses.

 

Who Can Benefit From Opening a Bank Account Abroad

The question of whether a Ukrainian citizen can open an account in a foreign bank today has an unambiguously positive answer, and the procedure itself is in demand both among businesspeople and private individuals.

 

A foreign account can benefit anyone, especially those planning to conduct business or simply wanting to increase their savings (as foreign banks often offer more favorable interest rates on deposits than domestic ones). It is advantageous and convenient to use the services of foreign banking institutions for those engaged in:

 

  • Freelancing: It is much more comfortable to pay for services.
  • Obtaining residency or citizenship: This process always involves paying various fees, government charges, and other types of payments required to meet program conditions.
  • Studying at a foreign university: A foreign account allows you to pay for education and related expenses.
  • Working for a foreign company – provides the opportunity to receive a salary.
  • Attracting founders and venture capital.
  • Showcasing your business project on crowdfunding platforms – a foreign bank account allows you to test your business.
  • Investing: It is much more convenient to accumulate the necessary amount to purchase valuable assets.

 

Even travelers visiting different countries will find having a foreign bank account extremely useful.

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Key Steps and Conditions for Opening an Account Abroad

The process of interacting with a foreign financial institution today resembles completing a complex quest. If you plan to understand how to open a bank account in another country, you should be prepared to sequentially fulfill the requirements of the compliance department.

 

The main steps for opening a bank account abroad include:

  1. Preliminary selection of a financial institution. It is necessary to assess whether a particular bank accepts non-residents from your region.
  2. Collection and legalization of documents. Most countries require documents to be translated and apostilled.
  3. Completion of the KYC procedure. The bank must understand not only who you are but also the origin of your funds.
  4. Interview (in-person or online). At this stage, it is important to properly justify why you need to open a bank account abroad.
  5. Activation and deposit. Some institutions require funding the account immediately after approval to maintain the minimum balance.

 

The main condition is transparency. Attempting to conceal details of your biography or sources of income will almost certainly result in a refusal with no right to appeal.

 

Choosing the Right Jurisdiction

Before opening an account in a foreign bank, it is important to take some initial steps. This can be a daunting task, especially for those who have never dealt with foreign banks or worked internationally. If you are currently actively studying the question of how to open an account in a European bank online, it is important to realistically assess the realities. When choosing a country, prioritize stability and international rating. It is also essential to clearly answer the question, “Why do you need a foreign account?” For example, unlike many EU countries, foreign clients are welcome in Singapore and Hong Kong, but deposits are not eagerly accepted. To assist you in choosing, let’s look at some popular jurisdictions for opening bank accounts.

 

Important! Experts at Lawrange will assist in selecting the most suitable jurisdiction for you or your business. We consider all nuances, from the political and economic situation to the spectrum of banking services offered in each country.

 

Switzerland

Opening an account in Switzerland can help you securely preserve your capital. Switzerland has a long-standing reputation for financial stability, reliability, and security. However, if you wish to engage in international trade, working with local banks may not provide significant benefits. There are very high requirements for a non-reducible balance, and the number of banking transactions is limited.

 

Serbia

You should know that this jurisdiction has joined CRS standards but still does not exchange data on the accounts of foreign citizens. Serbia is an ideal option if you are thinking about how to open a bank account abroad easily. Local banks impose minimal requirements on the applicant and conduct few checks. Opening an account in Serbia is also worth it for several other reasons:

 

  • High level of banking service.
  • Possibility to open dollar accounts and make SWIFT transfers.
  • Russian-speaking staff is often encountered.
  • Accounts are frequently opened for offshore companies.

 

USA

This country is home to the world’s largest banking sector. The online service system is well-developed. To open an account in the USA, you don’t have to have local citizenship (but you should meet certain conditions). The main advantages:

 

  • Conduct transactions worldwide.
  • Wide selection of credit solutions for individuals.
  • High confidentiality of personal data.

 

UAE

Opening an account in the UAE usually takes no more than 3 weeks. The banking system of this country is characterized by increased stability and the use of high data protection technologies. For many, it is advantageous that the UAE does not participate in the CRS automatic information exchange system. Non-resident individuals and legal entities can open multi-currency cards in local banks for transactions worldwide. There is a wide choice of various investment programs and offers for investors.

 

Hungary

Ukrainians in Hungary can use familiar banks like OTP Bank and Raiffeisen Bank. Opening an individual account in Hungary only requires a foreign passport and a temporary ID. Local banks offer the option to open accounts in any currency without restrictions on importing foreign currency. Non-residents are also welcome to open investment accounts.

 

Bank Requirements for Opening an Account Abroad

To open a foreign account as a non-resident, you must compile a complete document package. This package is often legalized with an apostille and must meet mandatory requirements, including:

 

  • Passports (foreign, internal) for an individual and passport copies for directors and beneficiaries when opening a corporate account.
  • Document confirming the source of income.
  • Information on the annual expected turnover of funds in the account.
  • Apostilled company documents for legal entities.
  • Description of the planned activities and business plan.

 

Depending on the jurisdiction, banks may require additional documents, such as a certificate of no criminal record or a bank statement from the applicant’s country of residence. The “strictest” banks additionally request:

 

  • Biographical information (education, employment, family composition, etc.).
  • Recommendation letters from business partners.
  • Evidence of the reality of doing business (contracts, business cards, etc.).

 

All requested documents are an essential element of the KYC and Due Diligence procedures. They verify a future client’s compliance with necessary requirements and assess the presence of risks. The process of opening a foreign account for individuals is much simpler than for legal entities, as banks are generally satisfied with verifying the personal documents of the applicant. In the case of companies, this procedure is somewhat more complex due to the need to comply with Anti-Money Laundering (AML) standards.

 

Features of Tax Regulation

Many foreign banks act as tax agents in their jurisdictions. This means that when investing in securities, for example, through an Austrian bank, a tax on local funds and securities is withheld at 27.5%. In Switzerland, there is a stamp duty on securities transactions. In Luxembourg, you will have to deal with a progressive tax scale. The rate here can range from 0 to 42%. Also, in Luxembourg, all non-residents default to paying tax under the “single persons” status.

 

In some jurisdictions, such as the Czech Republic, working with a multifunctional, universal bank may require payment of up to $1,000 in the equivalent per year. Large banking institutions may charge maintenance fees ranging from 3,000 to 10,000 euros in Private Banking. Moreover, even without account transactions, a quarterly or annual fee may be automatically deducted.

 

Lawrange Assistance in Opening a Foreign Bank Account

Opening an account in a foreign bank can be complex and depends on the jurisdiction. It is important to consider potential pitfalls and nuances. Specialists from Lawrange, who have extensive experience in solving such tasks, can provide assistance. We will advise on the most suitable jurisdiction based on your account opening goals. We will also assist in gathering the necessary documents and, if needed, represent your interests in remote communication with the bank representatives.

 

We offer:

 

  • Prompt organization of transfers.
  • Credit institution analysis.
  • Document translation and apostille execution.
  • Preparation of information references.

 

Our clients can contact us at any time for legal consultations. If you need to open an account in a foreign bank and want to avoid bureaucratic delays and negative consequences such as non-refundable document review fees or even rejection by the bank, then confidently seek assistance from Lawrange.

 

 

Conclusions

In conclusion, it should be noted that having a foreign financial instrument is not a luxury, but an element of security and flexibility in the global economy. Understanding how to open a bank account in another country provides an opportunity to protect savings from inflation and political risks. However, one should not forget about strict international regulation.

 

Each jurisdiction has its own specific rules, and what works in Serbia may be unacceptable in the UAE or the USA. If your goal is stability and predictability, approach the matter systematically, first studying the tax implications and reporting requirements in your country of residence.

 

FAQ

Is it possible to open an account abroad remotely?

Yes, modern neobanks and some traditional banks allow this to be done remotely. However, if we are talking about reliable institutions with high ratings, the procedure for opening a bank account abroad without personal presence will require the involvement of a professional representative. At Lawrange, we help organize the process through a power of attorney or video verification, saving your time and travel expenses.

 

What documents are needed to open a bank account abroad?

The basic package includes a passport, proof of residential address (utility bill), and documents showing the origin of funds (tax declarations, dividend statements, or property sale documents). If you are looking for a way to open a bank account in another country for business, add the company’s incorporation documents and a description of the business model. The full list always depends on the policy of the specific bank.

 

In which countries is it easiest for a foreigner to open a bank account?

Currently, the most lenient are Serbia, Kazakhstan, and some institutions in Georgia. There, requirements for non-residents are softer, and application review times are shorter. At the same time, if you need a solution for long-term storage of large sums, it is worth choosing more conservative options, such as Switzerland or Liechtenstein.

 

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