The United Arab Emirates (UAE) is famous for its renowned banking industry, and the high level of privacy banks offer their customers. The UAE has a booming economy and is home to massive populations of expatriates from across the globe. Most of the entrepreneurs and traders move to UAE for business. If you are planning on doing business in the UAE, you also need to open a bank account. Once your business or company is set up in Dubai, the next step to consider is the corporate banking options available to you and your company. If you are wondering how you can open a company bank account in UAE, there is no need to worry as here we highlight the complete guide to open a bank account.
Opening a UAE corporate bank account can be stressful for entrepreneurs. Newly implemented guidelines, ever-changing compliance regulations, and international banking protocols combined with the banks’ expectations over recent years can make it very time-consuming. The entrepreneurs might find the task of obtaining banking much more monotonous than the form filling and compliance checks that were needed for their company set up in Dubai and other emirates of the United Arab Emirates (UAE).
Why Is It So Hard To Open A Company Bank Account In UAE?
Among increased global inspection, acquiescence has become a top priority for banks. Across the globe, enhanced due to persistence and developing consents, are placing an everyday operational burden on companies.
Banks are fined more frequently for not following regulations to the letter, which has made them more unadventurous and accurate with account checking and vetting. The role of corresponding international banks is vital in any bank’s operation. This need for security creates a downwards pressure on customers as banks become more powerful to evade global inquiries on their transfers.
With new and existing accounts, UAE banks must be more careful than ever before. The regulatory overhead of such an inquiry from a corresponding bank is significant.
Why Is It Challenging To Get A UAE Bank Account For Some Company Types?
As the central bank has issued more stringent conditions and regulations, UAE banks have stretched up to ward off obstacles. Banks have executed more stringent rules and closed companies in some free zones with increased transfer data requests. They have also banned some license kinds that do not meet their upgraded acquiescence standards.
Nowadays, banks are resembling substance and proof that companies are who they say they are. Some banks have put cover due application wants on free zones in the northern emirates, while many license activities now also have additional necessities.
Company Bank Account Recommendations
When you are looking to secure a regional business bank account, then you must take the following steps to open a company bank account in UAE:
- Keep A Residential Address
It’s vital to secure a local residential address to prove your dedication to the country and the local economy. Bank signatories should also have a UAE visa and Emirates ID to enhance their opportunities for approval.
2. Signatory Should Hold Shares
Share ownership must be regarded when setting up an account. For international corporate and holding structures, the bank account signatory should have the company’s shares in the trust to open the account initially. After this is done, the claims can be assigned to your preferred holding structure.
3. Solid Business Plan
Create a robust business plan to make sure the best opportunity of opening your bank account. Your project doesn’t have to exceed three important information pages detailing who you are, where you come from, and your business purposes.
It is also suggested you create a landing page or website that confirms your suppliers and customers and secure physical offices in the most suitable location. Choosing for a free zone that matches your brand and persistence could also encourage your application’s viability.
4. Offshore Versus Free zone Viability
It would help if you familiarized yourself with the differences between offshore and free zone companies. Given the reputation of offshore banking scandals in recent years, UAE banks often negatively view local and international offshore companies. In this context, UAE banks usually only want to offer their services to local offshore companies under particular strict and structured events.
Recommendations For Company Bank Account Success
It’s important to distinguish your company in the right free zone to successfully secure banking services, with the correct visa and residential address.
In some cases, it may serve you to show loyalty to the country by investing in the right free zone rather than a cheaper offshore option, in addition to taking out a visa and Emirates ID with a local address.
Documents Needed For Opening A Company Bank Account In UAE
- Copy of MOA
- Trading license
- Passport with UAE entry page of shareholders
- Share certificate
- Emirates ID of shareholders (If shareholder have UAE residency)
- Visa Page of shareholders (If shareholder have UAE residency)
- Incorporation certificate
- Banking statement of shareholders dating back to the last six months
- Name of existing or prospective customers
- Utility bill of shareholders showing address proof
- Corporate legal documents and bank statements (If a shareholder has a company outside UAE)
Why Is The Bank Not Classifying Entrepreneurs As A Resident For Banking Purposes?
As global regulations continue to toughen, it has become more challenging to get resident status for UAE banking. As the UAE looks to improve its standing on the global stage, it has performed to Common Reporting Standards (CRS), which need all participating jurisdictions to get information from their financial institutions – comprising banks – and automatically replace this with each other every year to combat tax evasion.
You require to prove your commitment to the UAE within this context. Most local banks require that solely having a visa, and Emirates ID does not make you a resident for banking desires. If a UAE bank is uncertain of your residency or purposes, they must share your information with other banks under the CRS scheme.
Proving Your Commitment To The UAE
To increase your opportunities for opening a business bank account, it’s vital to show that you live in the UAE and spend a lot of time in the country. It’s also imperative that you get a residential address by renting or buying real estate. It’s possible to meet these criteria while still being internationally mobile as your business develops.