Opening of a corporate bank account in Singapore

According to the Central Bank of Singapore (Monetary Authority of Singapore), there are now four local banks and more than 140 foreign banks in Singapore's banking industry. Of these, at least 34 are full-service banks offering various solutions for individuals and businesses. In addition, there are about 100 investment banks in Singapore, which are engaged in capital management of legal entities.


Singapore's largest banks

According to Forbes' 2021 ranking, Singapore's largest banks by total assets are:

• DBS BANK
  
• OCBC
  
• UOB
  

In addition to local banks, many international banks operate in the Singapore market. Among the largest international banks are:

• HSBC
  
• CITIBANK
  
• STANDARD CHARTERED
  
• MayBank

Banks from around the world are also represented in Singapore, including BANK OF CHINA, State Bank of India, the largest Japanese banks MUFG BANK and SUMITOMO MITSUI BANKING CORPORATION.

In contrast to the individual entrepreneur (Sole Proprietorship), the Company is a separate legal entity separate from its owner(s). The company must have its own current account in a bank or payment system in order to conduct its activities and to settle accounts for the company (accept payments and pay bills).

Each bank has its own list of requirements, including a list of required documents, mandatory deposit requirements when opening an account and other nuances.

At the same time, the following basic requirements for opening a current account for business can be highlighted:

• Providing a complete set of documents (varies from bank to bank)
• Initial deposit (varies from $1,000 to $100,000 depending on the bank)
• Maintenance of minimum account balance (varies from $5,000 to $100,000)
• Presence of directors and authorized signatories at account opening

Foreigners can open a corporate bank account in Singapore for both companies registered in Singapore and foreign companies.

Keep in mind that foreign companies, as well as companies with foreign ownership, carry much higher risks for banks than local businesses, which can lead to huge fines and even revocation of the bank's license. Therefore, banks have higher requirements for companies with foreign directors or shareholders. Each bank has its own list of requirements for foreigners, as well as a list of countries for which it is possible to open an account.

The default requirement for all banks in Singapore is that all directors and shareholders must be present in person at the interview at the opening of the account.

If the company has many directors and shareholders, the minimum requirement is the presence of at least two directors of the company (of which at least one must be a local director, i.e. a Singapore citizen or a permanent resident), and at least one shareholder of the company.

The default requirement for all banks in Singapore is that all directors and shareholders must be present in person at the interview when opening an account. At the personal interview, bank representatives communicate with potential clients, learn about the nature of the business, its development plans and on this basis make a decision to open or refuse to open an account.

At the moment, remote opening of a bank account is possible only in a few banks and only for residents of Singapore (citizens and permanent residents).

Opening a corporate bank account under standard conditions with a personal visit to the bank can take from 2 weeks to 2 months depending on the bank chosen. But it is important to keep in mind that when using the remote opening option, the time frame can be considerably longer.

It will also take another 2-3 weeks to issue and send bank tokens, a checkbook, a debit card and its password.

Banks never disclose the reasons for refusal to open an account. But our years of experience will allow us to make our top 10 reasons why foreigners are refused to open a bank account in Singapore:

1. Wrong choice of bank (Singapore banks have their own "loyalty" ratings. By which I mean the list of countries and industries with which this bank works).
   
2. You have not convinced the bank of the reality of your business. The bank is not interested in start-up companies with vague plans, incomprehensible business model and tiny (by banks' standards) turnovers.
   
3. You have not convinced the bank of the need for a bank account in Singapore. A classic situation - the client said my counterparties in Russia, Kazakhstan and China, followed by a logical question - why do you need an account in Singapore and you need to be prepared for this issue in advance.
   
4. Mistakes in the application, indicating unreliable or insufficient data, lack of site,
   
5. Ignorance of bank compliance requirements. Every bank has a list of unfavorable countries, nationalities and types of activities that are considered high risk. This can lead to information that banks would consider to be high risk and this in turn can be a reason to refuse to open an account.
   
6. Failure to provide a complete list of documents that can verify the seriousness of you and your company. (Write in the comments if you need a checklist and we will send it to you)
   
7. Improper interview behavior, including disclosing information in the interview that will alert bank representatives rather than convince them of your trustworthiness.
   
8. Directors or shareholders of companies appearing on international blacklists (down to a mere name match)
   
9. The bank has suspicions of suspicious transactions, including money laundering, in which the CIS countries are suspected by default.
   
10. A serial nominee director. If your nominee director has more than 12, maximum 15 companies, your chances of opening an account tend to zero.

There is no panacea that will give you a 100% guarantee of opening an account in Singapore. But here is a list of tips which factors can significantly improve your chances of opening a bank account in Singapore:

• Availability of operating similar business in other countries,
• Proven experience of directors and shareholders in the company's business,
• A strong resume in business English of the company's directors and shareholders,
• Strong website presence,
• Existence of contracts/agreements of intent with prospective clients and partners,
• Availability of invoices and proof of payment (for existing businesses in other countries)
• A nominee director with a minimum number of companies (the less the better)
• Giving the vetted nominee director at least limited access rights to the bank account
• Having business clients/partners in Singapore
• Work or long-term visa to Singapore
• Availability of office and employees in Singapore

There is no barrier for us to open an account with any bank in Singapore, as long as:

• Your preferred bank opens the type of accounts you need (if the bank does not have the necessary license and does not provide certain services in Singapore, it will not be possible to open an account)
• You/your company meet the requirements of the bank

If you are a startup and do not qualify for a bank or for some other reason you cannot open a bank account in Singapore, in fact you have 3 main alternatives:

• registration of a fully nominee company, with a nominee director and shareholder resident in Singapore
• Account opening in another country
• account opening in the payment system

The advantage of the first option is the speed with which you can open a bank account for the company and no need to personally fly to Singapore, but the cost of maintaining a fully nominal company is much higher.

Opening an account in another country or payment system gives you the ability to make settlements on behalf of the organization, but does not solve your problems if you need settlements within Singapore. If you don't really care about settling inside Singapore, you can use one of these options, build up connections and contracts with which you can later come to a Singapore bank. In this case, opening a bank account will be much easier for you.

In cases where:

• You are planning a large turnover (over 1 million dollars),
• You will have large transactions (over $10,000)
• You plan to obtain a work visa to Singapore
• You plan to rent an office/open retail outlets and be active in Singapore,

In any of the above cases, we recommend that you open a bank account for your company, as the reliability and functionality of bank accounts is currently much higher than that of payment systems. It's more convenient for you and your clients, and the fees are lower on average than those of payment systems.

In case of difficulties with opening an account in a traditional bank (impossibility of flying to Singapore to open a bank account in person, refusal of the bank to open an account, etc.), we recommend you to consider a payment system as a temporary alternative to a bank account.

As a rule, Internet-acquiring can be connected to a company's existing bank account. The ability to connect, as well as the fees and conditions for this service differ from bank to bank. With Internet acquiring, customers can pay you with credit cards and the money comes directly to the bank account. An alternative to bank acquiring can be an account in PayPal, Stripe and other popular international payment systems which will allow you to receive payments by credit or debit card, in this case money comes to an account in these payment systems and you can withdraw it to your desired bank account.