What a Bank Checks Before It Opens an Account for a Company With Foreign Owners

A new company can hold a licence and a certificate on day one and still be unable to take a payment. The account is the step that decides how fast the business starts. Founders who know the checks ahead of time lose fewer weeks.

THE SAME FIVE QUESTIONS IN MOST COUNTRIES

A bank that takes a company owned from abroad wants to know who stands behind it, what it does, whether it really trades, where it is run from and where the money comes from.

It starts with the owners. The bank runs a know your customer check, KYC, on the company, on every beneficial owner who owns or controls it, and on the managers who will sign. A chart that follows the shares up to the individuals makes that check short.

It then asks what the business sells, to whom and in which countries money will move, how much will pass through the account in a month and where the first deposit comes from. Contracts, invoices or a business plan carry more weight than a description alone.

Last, it looks for proof that the company is real: a licence or certificate, the articles of association, a board resolution naming the signatories, and financial or bank statements for the last 6 to 12 months where they exist.

A WORKED EXAMPLE: THE UAE

The UAE shows how this plays out. A mainland or free-zone company with foreign owners opens an account with a UAE bank, and the bank sets the trade licence against what the company says it will invoice. It also weighs the owner’s visa and address against the size of the business, so an owner with a UAE residence visa has more banks to choose from.

Two routes exist. A digital bank takes the application in an app. Wio Business quotes 3 working days and charges AED 99 a month with no minimum balance. A large local bank takes 2 to 4 weeks from a complete application and meets the signatory in person, so plan one visit. A company that trades goods, writes cheques or uses letters of credit usually belongs at a large local bank.

Banks there also ask for the company’s registration with the Federal Tax Authority. If you plan a UAE account, you can compare six UAE business accounts side by side, with the monthly fee, the minimum balance and the kind of company each suits.

KEEP THE FILE ALIVE AFTER THE ACCOUNT OPENS

The bank goes on checking three things: the licence, the payments and the books. A company that changes what it does should send the bank the new contracts before the payments change. Emirates NBD, for example, allows two months after a licence expires and then charges AED 420 a month until the renewed one is on file.

A SHORT ORDER OF WORK

Choose the bank that fits your payments and your balance. Prepare the owners’ passports, proof of address and the ownership chart. Add the licence or certificate, the articles and the board resolution. Send the file complete, because a gap in it restarts the clock.