Hong Kong has long been recognized as one of the best places to do business. The city has an extremely business friendly outlook, especially when comparing the laws and regulations governing Hong Kong companies with those of other international cities. Given the city’s strengths, company registration in Hong Kong has been very popular. As opening a bank account in Hong Kong is a vital part of running a business, it is important to be well prepared when going through this process.
Without proper preparation, opening a bank account in Hong Kong can take months from submitting the application to having it up and running. In this article, we look to provide insight towards the Hong Kong bank account opening process and how proper preparation can shorten the application time.
What You Will Learn From This Article:
1. Why you should choose your bank wisely
2. The importance of identifying the right product
3. The differing Hong Kong bank account opening procedures
4. Bank account opening documentation requirements
5. How to prepare for bank meetings
1. Choose your Bank Wisely
- Identify and select the right bank that understands your business and is able to assist your short to medium term business needs. For example, whether you need to rely on their branch network, how often you need to make overseas remittances
- Simply applying to as many banks as possible will not improve your chances of opening a business bank account. It could actually cost you more in bank application fees.
2. Identify the Right Banking Product
- Each bank has varying products and offers a different range of services depending on the customer segment and profile. As a lot of Hong Kong banks are stepping up their effort to support SMEs, find the right banking products and respective banking teams that address your requirements and business profile. For example, HSBC has tailor-made different business banking accounts for SMEs that have little or none business history.
3. Account Opening Procedures
- Understand the bank account opening procedures that are often found in the banks’ website (i.e., Know Your Customer (“KYC”) procedures and documentation requirements). The bank will request the identity and residence information of all the company’s beneficial owners due to the Hong Kong’s anti-money laundering guidelines.
- Carefully study the bank account application forms and their corresponding instructions. All banks are required to provide clear instructions under the Hong Kong Monetary Authority.
4. Document Requirements
- Submit a detailed business plan that clearly outlines the company’s goals and strategies for achieving them. Often it includes your business objectives, description of your product/services, target clients, hiring plan, sale and marketing plan and financial projections.
- Prepare and certify the company incorporation documents and identity documents. Usually a professional accounting and CPA firm will able to help certifying the documents.
- Be cooperate to disclose the required information accurately.
- Provide evidence of business transactions, such as customer contracts and lease agreements, to demonstrate that your business has operations or commencing business very soon.
5. Bank Meetings
- Make an appointment for an in-person interview early in advance, especially when travelling from overseas. A licensed corporate service provider can assist your bank account opening arrangement.
- These appointments are typically made weeks in advance and typically include interview questions to clear the banks own KYC procedures.
- While some banks, such as DBS and Citibank, do not require an in person appointment to be made when opening a business bank account, many do.
- Be prepared for the bank interview as part of the bank’s due diligence process.
- Make use of your personal banking relationship to extend a business banking relationship with your existing bank.
- Referral and introduction from friends and other professionals certainly help (e.g. lawyers, accounting firms or corporate service providers).
6. Other Tips
- Simplify your business and shareholding structure.
- Be aware of the initial deposit requirements and the monthly required balance.
- Avoid the perception that opening bank account are very difficult.
Having assisted hundreds of clients in incorporating their companies and opening a bank account in Hong Kong, the FastLane Group understands how to get your company started on the right footing. Please contact the FastLane Group for help for bank account opening assistance, or other company formation process in Hong Kong.