Imagine this, you wanted to set up a completely new business entity or subsidiary in Hong Kong. You’ve passed the original company incorporation process and you are on the home stretch into incorporating your entity in the Hong Kong market.
- You have selected your company name and registered with ‘The Hong Kong Company Registry’ the type of business structure you wish to organize the business.
- You have found and selected an individual or several directors and, shareholders and hired a Company Secretary which is based in Hong Kong.
- Lastly, you have registered your company with the Business Registration Office at the Inland Revenue Department and done so within a month of commencing business in Hong Kong.
The next major step on your journey to fully prepare you for business in Hong Kong is to open a company bank account. For many small to medium-sized businesses (SMEs), it is extremely important that the cash inflow and the cash outflow are precise, easy to manage and sustainable. Excellent cash management, expert facilities, internet, and online banking are all extremely important to help business owners such as yourself to keep track of your money movements monitoring both your short-term and long-term business loans. These are all key financial requirements of any enterprise and are something that needs to be invested in. In this article, I will be overlaying the benefits of opening a bank account in Hong Kong, illustrate some of the key features of one local and one international Hong Kong bank and provide a step-by-step guide and list of documents you will need to complete this process.
Opening a corporate bank account is a relatively simple and straightforward procedure. In Hong Kong, all major banks both local and international have created and designed products and services which are bought and used by business owners to address different needs. However, before you can open an account with a particular bank, it is important to be mindful of what the bank will require from the business so you can be prepared to meet whatever the banks ask for.
Once, Hong Kong banks had a reputation of being offshore banks. This is where accounts could be opened within one hour even without a company representative being present and meeting the individuals at the bank. As time passed by, what was once a laissez-faire method of corporate banking had taken a turn becoming more and more suspicious. After Hong Kong became a part of the global anti-money laundering (AML) system, the HK authorities asked the banks to become more vigilant and tighten up the banking AML policies. The banks in Hong Kong had started to suspend suspicious companies in order to avoid compromising transactions and public scrutiny.
Although the new process is justified in its use, this has made opening new company accounts very difficult for newly registered companies. Because of this there is a huge amount of demand for service companies assisting with account opening services with multiple different banking companies. Here at Primasia Corporate Services Limited, we offer that service as part of our company incorporations package and thus work with both local and international banks to help our clients incorporate and register in Hong Kong.
Key Features of Hong Kong’s Major Banks
When you open a bank account in Hong Kong for corporate or personal purposes, there are numerous banks to choose from. For many of these banks, there is a strong presence in not only the East Asian region but also around the world. Here is an example of one local bank and one international bank you as a business owner can choose from:
HSBC is one of the largest banking and financial services organizations in the world. Serving more than 40 million customers worldwide in over 64 countries and territories in Europe, Asia, the Middle East, and Africa, they provide individuals with services such as wealth and personal banking, commercial banking, and global banking and markets. In Hong Kong, this is one of the banks that offers the most flexible wide range of services for your company.
Another option that businesses in Hong Kong can opt for is ‘Citi Hong Kong Corporate Banking’. With approximately 200 million customer accounts and doing business with more then 160 countries and jurisdictions. Citi provides consumers, corporations, governments, and institutions with a broad range of financial products and services including consumer banking and credit, corporate and investment banking, security brokerage, transaction services and wealth management. For newly registered businesses, this is one of the banks that offer some of the more convenient services for individuals. Citi Bank is also known for scoring well in terms of international services. This means, you use Citi bank if you wish to branch away from Hong Kong into other territories in the East Asian region. Conversely, an individual could use Citi to branch into the Hong Kong region allow the new business entity to easily set up an international business bank account for Hong Kong.
Choosing the right bank for your company will depend on numerous factors which need to be considered from your own perspective. Some examples of these factors include the international presence of the bank or the number of services that are offered as part of that bank’s package scheme for businesses in Hong Kong. Clients will also rely more on options with banks that provide digital banking and other packages that provide an easier term of use. All banks will have a set criteria of special policies for due diligence and clients have to undergo verification before they can open a bank account in Hong Kong. Primasia has worked with these banks and therefore has expert experience on particularly HSBC and Citi Bank. Here is some information that we know about them:
|Feature||HSBC (Local Bank)||Citi Bank (International Bank)|
|HK$ current account availability.||Yes.||Yes.|
|Foreign currency account availability.||Yes.||Yes.|
|Initial deposit.||5,000 for HK$ current account|
5,000 or equivalent for foreign currency.
|For HK$ current account: HK$10,000.|
For foreign currency account: HK$10,000 or equivalent.
|Average monthly balance||500,000 for HK$ current account. (Business Vantage)|
500,000 or equivalent for foreign currency account. (Business Vantage)
|For HK$ current account: HK$10,000.|
For foreign currency account: HK$10,000 or equivalent.
|Monthly fee payable in the absence of average monthly balance.||For HK$100,000-HK$500,000: HK$75.|
For < HK$100,000: HK$150.
|ATM card availability.||Yes.||Yes.|
|Default ATM withdrawal limit per day.||HK$20,000.||HK$20,000.|
|Chequebook facility.||Yes, for HK$ and US$.||Yes, for HK$ and US$.|
|Credit card availability.||Yes.||Yes.|
|Internet banking facility for enquiries, local payments etc.||Yes.||Yes.|
|Unlimited internet transfer subject to account funds availability.||No.|
For non-designated account: HK$500,000.
For designated account: HK$1million.
|Accounts Payable Services:||Yes.||Yes.|
|Accounts Receivable Services:||Yes.||Yes.|
|Account setup fee.||HK$100.||None|
Step-by-step guide on how to open a bank account in Hong Kong.
Some banks in Hong Kong will insist you meet them in person, though online meetings are now somethings possible Even if the bank provides an e-form and a possibility to apply online; The bank will only consider the documents and give the general approval or disapproval ahead of the meeting. Hong Kong banks decide on their own discretion whether to accept or deny an account opening application. In other words, if they turn down your application, they are not obliged to either explain their decision or give you a chance to reinvestigate the procedure. This entire process of opening a corporate bank account in Hong Kong takes approximately two weeks. We do acknowledge however, there are cases when clients got their account applications approved within 2 business days and then the accounts were activated within a week.
The following documents are required to open a corporate bank account in Hong Kong
- An extract of the board resolution approving the opening of a corporate bank account.
- A certified true copy of the company’s Certificate of Incorporation.
- A certified true copy of the company’s Business Registration Certificate as issued by the IRD.
- A certified copy of the company’s Articles of Association.
- A director declaration providing the personal particulars of directors and principal shareholders.
- A copy of the Hong Kong identity card or passport; residential proof for each of the directors, authorized signatories, principal shareholders and beneficial owners of corporate shareholders.
- A list of specimen signatures of authorized signatories.
- Proof of business such as business plan or audited financial statements.
- A certified copy of an organization chart that shows the percentage of shareholdings held by each individual and the ultimate beneficial owner. This is applicable for corporate shareholders of the company.
- Details of ultimate beneficial owners for nominee shareholders of a company.
- A certified copy of the trust deed or declaration of trust with details of the trustees, settlers, and beneficiaries. Applicable for ultimate beneficiaries who are trusts.
Although these are all the documents you will need to open a corporate bank account, another requirement would include the initial minimum deposit to open the bank account with whatever bank you choose in Hong Kong. In addition, if you are an offshore company you will need to submit a Certificate of Incumbency and Certificate of Good Standing in addition to the normal documents.
If you wish to open a company in Hong Kong in 2021, our team here at Primasia is more then happy to assist you throughout the needed steps, starting with choosing the business type, followed by opening a corporate bank account with one of our partnered banks and other steps towards proper business registration. If you are an individual that is currently outside of Hong Kong it is a benefit to work with local teams and experts in the area in order to get your business off the ground the right way. For more information about company incorporation services and corporate bank accounts, please click here to visit the Primasia Corporate Services website and learn more about our company’s services here in Asia, as well as the wide range of other service we offer.
Primasia Corporate Services is a Hong Kong based corporate services provider that has been supporting its clients in Asia for over three decades. Among several of our services, Primasia Hong Kong (Primasia) offers our clients Online Accounting services, China Company Incorporation services, Virtual CFO services, MPF Filing services, Profit tax filing services, Employment return filing services, Wholly Foreign-Owned Enterprise (WFOE) incorporation-, and registration services etc. One of our services which we are proud to be offering our clientele is our investment visa and working visa Hong Kong services.
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Hong Kong Headquarters: Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wan Chai, Hong Kong