Startups Opening Bank Account In Hong Kong Bank Account Opening
June 12, 2015/in
For expats with budding business idea, is quick and easy. Recently, many expats got caught up in the corporate bank account opening in Hong Kong after company formation.
If you love to source information from internet (everyone do), you’re probably fed by desperate posts and comments about abrupt and rejection by big names in the city e.g. HSBC, Standard Charater Bank.
Those disappointed entrepreneurs concluded somewhat “Hong Kong is no long pro-business”, “Hong Kong hates startups”, “Never come to Hong Kong for banking”, “Other offshore jurisdictions are very welcome expats to do business, except Hong Kong”.
No Pain No Gain
Why does Hong Kong earn its name as international financial hub? Our city is characterized by freedom of doing business, robust regulatory on financial system, effective currency peg of Hong Kong Dollar to US Dollar, and the low and simple tax regime.
Doing a quick online searching, you can find out the success of Hong Kong is highly relying on if we can keep our name as the worldwide financial center: We are .
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Whenever our non-Hong Kong clients say that Hong Kong is not a city for business anymore becasue they can’t open the bank account for their local companies or orversea corporations, we would remain them that Hong Kong is a city populating over 7 million people and we live here following the rule of laws. If you want your business to run a long way in this city, you have to follow the local games rule.
Hong Kong is not a jurisdiction whose economy is solely depending on offshore financial services, Hong Kong is a city for doing business. You may find the hardship during your initial stage of Hong Kong business, but you should not retreat. Seek help from experts, tune up your business strategy, and try again.
As bank accounts in Hong Kong banks are generally known as “difficult to open”, it means your customers and suppliers should feel confident to your company if you can successfully open a Hong Kong bank account after all the challenges.
Know-You-Client (KYC) is a Chicken-Egg Problem
No matter which banks in Hong Kong you have approached for account opening, the bankers are responsible to know all the details of your business as well as the owners. It’s because the banks are following the “Know You Client Policy (KYC)” imposed by the regulatory authorities in Hong Kong.
Simply put, the bankers must interview in-person with the business onwers in Hong Kong and the banks need proof from applicants to obtain no-doubt ansnsers the questions as follows:
- What is the nature of the business?
- Where are your suppliers from?
- Where are your customers from?
The whole situation sound ridiculous for startups as it’s the chicken-egg problem: They cannot do business without a Hong Kong business bank account, and they cannot get the Hong Kong business account without doing business
What make the banks’ KYC like a mystery is the the bankers and the banks’ customer services officers never elaborate the reasons why their applications fails.The only feedback
