Do you plan to open a multi-currency business account in Hong Kong but not sure what options you have? Perhaps you have tried to open a business account with some banks, but got rejected.
I understand your frustration in that case. Luckily, there are service providers, such as Neat HK, that allows foreign companies to open multi-currency bank accounts in just a few days and without the need of even visiting Hong Kong.
Neat HK has shaken up the banking industry in Hong Kong and made it possible for many small companies to open local bank accounts.
What is Neat HK?
Hong Kong is the preferred location for FinTech companies, startups, and eCommerce sellers that want to incorporate in Asia. Even if it’s comparably easy to open a company in Hong Kong, it’s become significantly more difficult for small companies to open local business accounts.
Hong Kong’s banking industry has been bashed on much in the past years as locals and foreigners suffer from the hurdles to open local personal and business accounts.
Therefore, Neat HK was started in 2016. The founders, David Rosa and Igor Wos, both have a long experience from the banking industry and knew what issues SMEs and startups had to deal with when trying to set up business accounts in Hong Kong.
So is Neat HK a traditional bank? Not really. It’s a FinTech solution that works with a licensed partner and allows companies to open online business accounts for free from anywhere in the world. You don’t even need to visit Hong Kong in person.
They also work with ePaylinks, which is a licensed MasterCard prepaid card issuer in Hong Kong.
Benefits of using Neat HK
Opening a multi-currency business account with Neat HK is easy and it won’t take you more than 15 minutes to apply online. Your account is normally ready in just a few working days, compare that to other banks that sometimes need months to open an account.
Besides, you get access to a multi-currency account with local payment instructions for currencies such as HKD and USD, while you can also open a UK business account for GBP and EUR.
At the same time, Neat is integrated with payment processing solutions like Paypal, Amazon, Braintree, and Stripe, allowing you to offer end-to-end payment solutions for cross-border eCommerce sellers, for example.
There a few drawbacks of using Neat though, at least at the moment.
For example, they don’t allow integration with accounting systems, but this will be upgraded soon. Also, money received in foreign currencies will be automatically converted HKD and you cannot get credits or a saving account.
Having said that, the benefits overweigh the disadvantages from my point of view. There are few or none that offer similar services for free and without the necessity of visiting Hong Kong in person.
Simply visit Neat HK’s website if you’re interested in opening a multi-currency business account for free.
What kind of business accounts are available in Hong Kong?
To help you better understand whether Neat HK is your preferred option, I’ve made a comparison with the traditional and offshore banking solutions. Let’s start and have a look at the benefits and drawbacks of opening a traditional bank account in Hong Kong.
1. Opening a Traditional Bank Account in Hong Kong
Some years ago, it was easy to open a local traditional bank account. Foreigners could simply go to a local branch in Hong Kong and provide a handful of documents, having the bank account set up in just one day.
That’s not the case anymore.
Nowadays, you need a more robust business plan, sound financial results, more information about your company and the directors/shareholders.
Not only is it more expensive, setting up a business account at a local branch can take months if you’ll ever get accepted. Thus, many companies need to get help from agencies who specialize in helping to set up accounts, which adds to the costs.
Having a traditional business account brings some similarities to Neat HK as you get access to multi-currency accounts that are integrated with the above-mentioned payment processing solutions. Besides, they sometimes offer credits, which is not available at Neat HK.
Opening a traditional business account can be beneficial for bigger firms. However, Hong Kong banks have become notorious for charging high fees and the process is slower and more complicated.
Not to forget, you need to visit Hong Kong and a local branch to open the account.
2. Opening an Off-Shore Business Account
It’s generally easier to open off-shore business accounts compared to traditional bank accounts, so this solution is somewhere in between when looking at complexity.
However, it’s easier said than done and companies often need help from an agency that can help them through the process. Again, this will add to the costs.
Keep in mind that it can be difficult to manage transactions through Paypal, Braintree, and Stripe if you have an off-shore account. The reason is that these payment service providers generally require that you connect a bank account from the country where you’re company is registered, which in this case would be in Hong Kong.
You’ll also need to be careful when opening an off-shore account due to tax regulations (protecting both the business and the directors) and do research about CFC regulations as these differ between countries.
Process when opening a business Account with Neat
You can simply go to the Neat HK website and make an online application directly. The process won’t take more than 15 minutes, but just be sure to prepare the following documents beforehand:
- Explanation of your company’s business model
- Business license
- Copies of passports of the shareholders and directors with more than 10% of shares
After, they will send you an email where and confirm that they have received the application and that it will take some days to register and activate the account.
Again, this is free and can be done from any place in the world.
Another benefit is that you can apply for a MasterCard, which is free as well. This needs to be done through the Neat application.
Restricted Nationalities, Countries, and Companies
Neat cannot open business accounts or personal accounts for customers, directors, or shareholders from countries such as Bulgaria, Estonia, Saudi Arabia, and Ukraine.
To see the complete list, you can visit this page.
Also, examples of companies that operate in any of the following industries cannot open an account:
- Aviation related businesses
- Adult industry
- Cryptocurrency related businesses
- Foreign exchange related companies
- Gambling & casino related companies
- Stock & securities companies
Can a foreign company open a business account in Hong Kong?
Traditional banks can be reluctant to open bank accounts for overseas companies, due to strict anti-fraud regulations. Having said that, there are no laws that prevent foreign individuals or companies to open Hong Kong bank accounts.
Can I open a business account online in Hong Kong?
Traditional banks generally don’t allow companies and individuals to open bank accounts online. But, there are service providers that have made it possible for both individuals and companies to open personal accounts and business accounts online.
How much money do I need to open a business account in Hong Kong?
The minimum amount to open a business account in Hong Kong starts from around HKD 10,000. It’s up to the bank to decide what the minimum limit is.
How does a multi-currency account work?
It’s an account that has the same account number but with different currencies. This is useful in today’s globalized world and where companies manage cross-border transactions.