A bank account is opened to deposit cheques, maintain balance, carrying out different forms of transactions. An individual and company can open bank accounts. For this purpose, there are different forms of bank accounts.
Singapore is one of the largest financial centres in the world. Owing to its worldwide reputation, companies want to set up their business in Singapore. Any corporation would require opening a Singapore bank account to carry out transactions on behalf of the business locally.
A bank account which is opened in Singapore for an entity must be differentiated from a regular bank account which is opened by an individual. A person will open a Singapore Bank account, with a retail bank. Corporate businesses can also open bank accounts for retail banks. However, there are specific conditions for opening a Singapore Corporate Bank Account.
Types of Bank Accounts in Singapore
There are different banks which operate from Singapore. Being a financial hub, this country will have domestic banks as well as international banks. The market offered for opening a Singapore Corporate Bank account is competitive. Hence banks which operate out of Singapore have to offer competitive benefits to different customers.
The following types of bank accounts can be opened in Singapore:
- Singapore Individual Bank Account- Any individual can open this form of a bank account. An individual would be eligible to open this form of a bank account. An individual can be a resident, non-resident, or a foreign resident. It is relatively straightforward to open this form of a bank account when compared to the Singapore Corporate Bank Account.
Most retail banks in Singapore open this type of corporate bank account for individual customers.
- Singapore Corporate Bank Account- A Singapore corporate bank account, can be opened either by a company, a limited liability partnership, a sole trader, or any other form of entity which has its form of legal existence. An entity which has a separate legal personality must be differentiated from the shareholders and directors.
Therefore, this form of bank account can be opened by most corporate houses that offer services in Singapore. For example, a law firm in the UK wants to open an office in Singapore. Apart from other formalities for registering their business in Singapore, they would also require to open a Singapore Corporate Bank account.
This is a mandatory requirement for a business to open a bank account in Singapore for carrying out different forms of transactions in Singapore. All the transactions which occur in Singapore have to go through the bank account. Hence, the firm must open a Singapore corporate Bank account.
What is the main regulatory authority for opening a Singapore Corporate Bank Account?
The primary regulatory authority for opening a corporate bank account in Singapore is the MAS. The MAS is an abbreviation for ‘The Monetary Authority for Singapore’. All financial transactions which occur in Singapore are routed, through the MAS. Hence compliance has to be maintained with the MAS for opening a bank account in Singapore.
Pre-requisites for opening a Bank Account in Singapore
There are specific pre-requisites for opening a corporate bank account in Singapore. If a business or entity fulfills all the conditions, then the bank account can be opened with ease.
The following pre-requisites have to be considered for opening a Singapore Corporate Bank Account:
- A company or any other form of entity is only capable of opening a corporate bank account in Singapore.
- The company has to satisfy the minimum eligibility criteria for opening a corporate bank account in Singapore.
- The company must also satisfy the requirements of submitting the minimum documents for incorporating a company.
- If required, the bank opening a Singapore corporate bank account on behalf of the company or business may require the director or the shareholder to be in-person to represent the company for opening the bank account.
If all the above requirements are satisfied by the company, then a corporate bank account can be easily opened in Singapore.
How can a company open a bank account in Singapore?
The process of opening a bank account is straightforward. As long as the company satisfies the minimum criteria, the bank account can be opened. When compared to the individual bank account, the corporate bank account also has a similar process.
The following steps have to be followed for a company to open a bank account:
- Researching the Singapore Market
- Choosing a Bank
- Filing an Application for Opening a Corporate Bank Account
- In-person Visits
- Verifying Permits
- Opening the Bank Account
- Researching the Singapore Market- Singapore is one of the largest financial hubs in the world. Hence many banks offer different types of banking processes in Singapore. The company needs to research the market. In this process of research, the company has to choose an appropriate bank which offers incentives and benefits to customers. For example, some banks which open corporate bank accounts on behalf of companies in Singapore offer certain benefits such as no form of minimum balance which has to be maintained by the company. Like this, there are other banks which offer benefits. Based on the requirements of the business, a Singapore corporate bank account can be opened.
- Choosing a Bank- Once the company has researched the type of bank chosen for opening a bank account, then the company has to go ahead and choose the type of bank. Again here, the company would have to weigh the benefits and drawbacks of opening the account with a particular bank.
- Filing an Application for Opening a Corporate Bank Account– The Company has to make an application for opening the corporate bank account. This process can be carried out either online or offline. Some banks prefer submitting the documents in person, whereas other banks are used to conducting the Know Your Client details online. Technology and Digitisation have converted the entire process of banking processes. Nowadays, video KYC and other forms of identification are allowed.
- In-Persons Visits- Some banks in Singapore require the company to send a representative to open the bank account. This is required for physical verification purpose. A bank which considers the same will require the applicant to either nominate a director or shareholder to represent the company in opening a Singapore Corporate Bank Account. In this process, bank executives would be able to meet the representatives of the company in person. Apart from this, the representative of the company would also have to submit the documents. Through this process, it becomes easier for the bank to collect and verify documentation of the applicant.
- Verifying Permits- In this step, the banks would cross-check the identity and verify if the applicant obtains respective permits. If an international company makes the application, then, the bank will have to verify KYC (Know Your Client) of the applicant. The bank will have to check if all the directors and shareholders of the company have permits to work in the company. Apart from this, the bank must also verify with the Registrar of Companies, Singapore if the business has satisfied all the requirements of opening a business. Along with this, the bank will also cross-check if the business has registered with the Income Tax Authorities in Singapore.
- Opening the Bank Account- If all the requirements have been satisfied by the company, then the bank will open the corporate bank account. However, the bank may impose specific conditions which have to be followed by the company.
Who is eligible to open a Singapore Corporate Bank Account?
The following individuals are eligible for opening a Singapore Corporate Bank Account:
- Individual Representative of the Company– If the company is a domestic entity then a Singapore national is required for opening the corporate bank account. If the applicant is an international company, then the bank will require documents such as a passport and visa.
- A bank account in Singapore can be open either offline or online. However, opening the bank account in Singapore will depend on the requirements of the company. Some banks offer both processes of opening the Singapore corporate bank account.
- The applicant should not have any form of criminal convictions or any form of insolvency proceedings against them.
- Apart from these requirements, the applicant must take the required consent from all the authorities for conducting the business.
What Documents do I have to submit to open a Singapore Corporate Bank Account?
The applicant has to submit the following documents for opening a Singapore Corporate Bank Account:
- Any form of permit documents such as passport and visa documents. Such documents will only be required if the applicant is an international company.
- Company Incorporation documents such as the memorandum of association and articles of association. These documents have to be in accordance with the requirements of the bank for opening a bank account in Singapore.
- POA (A power of attorney) is required in document form from the company if they have appointed a representative to open a bank account.
- Planning Permission and Other requisite permission required from the Government of Singapore.
- Operation Plan that the company or entity is going to start the business in Singapore.
- Resolution of Directors and Shareholders.
- Residential Proof of Directors (Permanent Residents in Singapore).
- Any other documents which are required by the bank.
When submitting the documents, the directors or representatives of the company have to state that all the facts provided are true and accurate as per the information provided by the company. If all the documents are in order, the corporate bank account can be opened.
Different Domestic Banks and International Banks in Singapore
The following features are offered by domestic as well as international banks in Singapore:
DBS Bank (Development Bank of Singapore)
- A representative is required for opening the corporate bank account for DBS bank. Apart from this, an authorised signatory is required for opening the account.
- Online applications for opening a Singapore corporate bank account is allowed for this bank.
- Verification of documents is possible through ways such as Video KYC, Skype and other video calling applications.
- There is no initial fee which is required for the bank to open a Singapore Corporate Bank Account.
- Minimum Deposit of between SGD 1000 to 5000 is usually required to be maintained by the business in DBS Bank.
- Minimum Balance of more than SGD 10,000 is required to be maintained by the business. If this cannot be maintained, then the company will be charged monthly a specific amount.
- There is no form of debit card fees or cheque book fees which is required to be paid by the business. For securing the cheque book, the business requires to pay SGD 25 for opening the Singapore Corporate Bank Account.
- All other banking facilities, such as Internet Banking are cost-free.
OCBC Bank (Overseas Chinese Banking Corporation)
- The requirement of in-person meets is required for this bank. However, there are specific exceptions that can be made as per the requests of the company.
- For opening the Singapore Corporate Bank account with OCBC bank, there is no application fee or setup fee. However, this bank would charge an administration fee for the account. This is not charged for the initial period.
- SGD 3000 is charged for opening the Singapore Corporate Bank Account with this bank.
- Minimum balance which has to be maintained with this bank. The minimum balance charged by this bank is SGD 4000 per month. If the busines does not maintain this, then a fee would be charged by the bank.
- There is no form of the fee charged on the use age of debit cards offered by this bank. The daily debit card transaction limit is SGD 5000, and the business can withdraw up to SGD 10,000.
- Any other form of transactions such as internet banking is free.
Standard Chartered Bank
- Physical verification is required for Standard Chartered Bank. The director or shareholders have to attend the physical verification process. The bank would require conducting due diligence procedures. This physical verification may be exempted for particular purposes if the customer is an already existing customer.
- For opening a Singapore Corporate Bank account with Standard Chartered Bank, there is no application or set up fee.
- The minimum balance which has to be maintained with this bank is more than SGD 30,000. If the business does not maintain a minimum balance, then a fee would be applicable.
- No Amount of money is charged for having an ATM card or a cheque book.
- Another form of banking transactions carried out through this bank is free.
- The requirement of the physical verification process is mandatory for Citi Bank. For conducting KYC and due diligence, the process must be face to face.
- No form of the setup fee is charged for Citi Bank.
- There is a minimum deposit requirement for opening an account with Citi Bank. The company has to maintain SGD 100,000 in this account.
Hence it is important to understand the types of banks before opening a Singapore corporate bank account. The company must individually understand the requirements and carry out the process of opening a bank account.
There are different forms of bank accounts which can be opened in Singapore. Opening a Singapore Corporate Bank Account requires the company to satisfy the minimum criteria. If the company satisfies the criteria, then the process of opening the corporate bank account is seamless. A company has to carry out proper due diligence before opening a corporate bank account. This process will help the business to analyse which bank is most beneficial for their business.
Read our article:Company registration in Singapore: Requirements and Procedure
Varun Hariharan has completed the Legal Practice Course from BPP Law School, Manchester. He has a Masters in Commercial and Corporate Law from the Queen Mary University of London and LLB Honours from Bangor University, UK. He specialises in law related to corporate, artificial intelligence and technology law.