Start-up & SME: Open a Business Bank Account in Hong Kong

Beginning your start-up journey in Hong Kong? After registering your business, opening a business bank account is the next step. But we know it’s not always easy to open a business bank account in Hong Kong. (Even more difficult if you don’t have a Hong Kong Permanent ID.) Have no worries! We’ll cover the alternatives and tips to smooth the process for you.

What is a Business Account?

A business bank account has most of the features of a private account but with additional functions for your business needs.

Opening your business account establishes your business’s creditworthiness with your banking record, which may help your future financing as you may get a lower interest rate if you have a good track record of credit.

Second, you can access business services like having multiple holders’ access for different business partners, cash management, payroll processing, overdraft services, electronic fund transfers, etc. More importantly, you could have higher transaction limits to run your business.

Why Do You Need a Business Account?

You may skip the bother and use your personal account for business use. But we can’t stress enough the benefits of separating your personal and business accounts for running your business. Here are the top 3 reasons why you need a business account.

1. You can access business account features such as cash management, payment processing, and overdraft services to manage your business finances better.
2. You can distinguish between business-related and personal transactions.
3. You can limit possible legal and financial risks.

How to Open a Business Bank Account?

For opening a business account, you need to fulfill two requirements: being physically in Hong Kong and preparing all the necessary documents.

Being physically present in Hong Kong is the first requirement for opening a business account. Just keep in mind that during the application, the shareholders, directors, significant controllers, and bank account signatories, such as the company manager, may need to visit the banks in person despite the fact that some banks allow online applications.

Preparing all the required documents is your second challenge when opening a business account. There’s nothing worse than waiting for an arranged appointment and discovering that you’ve missed some documents, so make sure to double-check them with the banks.

In general, you’ll need to bring your personal and company documents for the bank to review as part of their due diligence and KYC process. Each bank has different document requirements for opening a business account, so remember to prepare the supporting documents tailored to each bank’s specific needs.

Here’s a list of some of the basic documents that are commonly required by most banks, but please inquire directly with the banks for further details:

• • Proof of identity. Passport, Hong Kong ID, or business director’s ID for all directors, shareholders with 10% shares or more, signatories, significant controllers, and ultimate beneficial owners.
  • Proof of business address. Property license or bank statements, utility bills, tax letters, or driver’s licenses no more than 3 months, for all directors, shareholders with 10% shares or more, signatories, significant controllers, and ultimate beneficial owners.
  • Board resolution approval. The resolution serves to approve the opening of the business bank account and assign one person the authority to handle the application process with the bank.
  • Declaration from directors. This declaration includes personal details for all directors and principal shareholders, such as professional experience and resumes.
  • A certified copy of the business registration certificate, certificate of incorporation, and business articles of association. These documents prove that your company has been duly established and legally registered in Hong Kong.
  • List of specimen signatures for all authorized signatories. This includes the signatures of the registers of directors, members, significant controllers, and secretaries.
  • Proof of business operation. This includes contracts, supplier invoices, detailed business plans, or audited financial statements.
  • A certified copy of the incorporation form (NNC1/NNC1G) and the latest annual return (NAR1).
  • A certified copy of share certificates from the organization chart. It shows the shareholding and management structure of the company.

Here are some extra documents for any body corporate as director or shareholder:

• A certified copy of the Certificate of Incorporation and Certificate of Incumbency. Also known as the Good Standing Certificate, it is necessary for offshore companies with limited public information. It verifies the company’s management and ownership structure and confirms its good standing.
• A certified copy of Share Certificates of the organization chart. It shows the shareholding and management structure of the company as well as the equity percentage held by the ultimate beneficial owners in the company.
• Register of Significant Controllers. The document discloses the details of the individuals with substantial influence on the company to be accessible for review by law enforcement officers upon demand.
• A certified copy of the trust deed. For beneficiaries that are a trust, the paper should include the details of all trustees, settlers, and beneficiaries.

Having the required documents doesn’t guarantee a successful application. Due to strict compliance regulations, each bank makes an independent decision on each application.

Hong Kong Business Bank Account Comparison

Choosing the right bank to open your business account can save you the hassle later, with all the customer services, interest rates, etc. We know you don’t have time for research, so we’ve prepared a comparison for you!

Business Bank Account	Account opening fee	Initial Deposits	FX Support	Fees and Charges
HSBC Sprint Account	HK$ 1,300	HK$ 10,000	11	Waived for 1st year. HK$ 200 per month is charged if average TRB is below HK$ 50,000.
OCBC Wing Hang SME Banking Business Account	HK$ 1,200	HK$ 10,000	15	HK$ 150 per month is charged if TRB is below HK$ 50,000,
Bank of China Business Integrated Account	HK$ 1,200	N/A	16	Wavied for the first 3 months HK$ 120 per month if TRB is below HK$ 50,000
Hang Seng Bank Biz Virtual+ Account	HK$ 600 Through Online Service HK$ 1,200 Through Business Banking Centre	HK$ 20,000	Special rate for FX	From the 25th month, waived if Total Relationship Balance is above HK$ 50,000. HK$ 200 per month is charged if TRB is below HK$ 50,000.
DBS Business Account	HK$ 1,200	HK$ 200,000	14	HK$ 250 per month is charged if TRB is below HK$50,000.
Citibanking	HK$ 2,100	HK$ 0	12	Wavied

Which Business Bank Account Suits Your Business?

Before you make the decision, let’s check out what they offer to a start-up company like us.

HSBC Sprint Account

HSBC Sprint Account is an entry-level business account for start-ups. It now offers a monthly fee waiving for 1st year. You may also use the exclusive payment app “PayMe” for your business. It now has a welcome bonus of HK$ 300 bonus by signing up PayMe for business by 31 March 2023.

Hang Seng Bank Biz Virtual+ Account

Hang Seng Bank Biz Virtual+ Account is a great choice for those just starting out. It has the lowest application fee, and you won’t have to pay any monthly fees for the first 2 years and a halved application fee (HK$ 600 only). It’s a great option to test-drive your business bank account and see if it’s the right fit for you.

DBS Business Account

If you’re looking for the bank which won the title of ‘Hong Kong’s Best Bank’ and ‘World’s Best SME Bank’ from Euromoney’s Awards for Excellence 2023″, DBS Hong Kong is your choice. They offer banking services that won’t disappoint you.

You can set up a DBS business account online as short as 3 working days, and if your application is successful, you’ll enjoy a series of ‘$0 fee’ offers exclusively for SMEs. This offer is available until March 31st, 2023, so don’t miss out! In case for some reason your application isn’t successful, you won’t be charged any account opening setup fees.

Tips for Opening a Business Account in Hong Kong

Apart from researching and preparing all the necessary documents, don’t forget to call the bank beforehand to book an appointment. some banks may require certified or translated documents if they’re not in English or Chinese.

If you don’t live in Hong Kong, you’ll need to fly there to meet with the bank officer or consider hiring an agency to help you gather the required documents and guide you through the process.

Statrys and Airwallex: Bank Alternatives for Business Accounts

We know the frustration of getting a business account. Still, some people have started to use Money Service Operators (MSOs) as alternatives to getting the job done. Maybe it’s a good time to try out a new way—MSOs.

MSOs, as a bank alternative, are regulated as payment institutions rather than banking institutions. When you use their services, your funds will sit under a traditional bank that operates underneath it.

In general, it’s pretty safe in the sense that no collapses or scandals have been reported so far.

To open an account with MSO, you don’t need to travel to Hong Kong. MSO has full online services, so you can stay wherever you are to get your account. It only takes 48 hours to complete the online application.

Generally, the fees charged by MSOs are cheaper than those charged by traditional banks if you aren’t offered fee waivers. For example, Statrys is charging HK$88 per month compared to the cheapest option with a monthly charge of HK$120 from Bank of China.

If you feel regret for opening an alternative bank account and want to transfer to a traditional bank, you can definitely do that to save time and keep your business with MSO while waiting for the application process with traditional banks. One thing to notice is that when you have a track record with MSO, it’ll be much easier to open a business bank account with traditional banks later.

Here are two popular Money Service Operators offering services in Hong Kong: Stratrys and Airwallex.

Statrys

• Has payment accounts in Hong Kong and Europe
• HK$ 88 on a monthly fee basis
• No fees for receiving local payment in HK$ and only 5 HK$ for local transfer
• Good FX rates
• B2C service is supported.
• UK MasterCard (for UK account)
• Ideal for an SME to use on a daily basis

Airwallex

• Integrates with Xero accounting platform
• Very good FX rates
• Can setup accounts in Singapore for risk diversification
• Commercial customer support
• Allow transfers to individual
• Opening is quick
• Physical visa card
• Upcoming payment getaway to (merchant account) – Stripe alternative
• Preferential rates for e-commerce companies
• Not Hong Kong-based company

For more details of Airwallex, you may click the link here.

Looking for more personal finance tips? Remember to check out the MoneySmart blog!
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