A bank solvency certificate is sometimes required for legal, government, and contracting purposes.
In this article, we’ll share how you can get a solvency certificate and answer the most common questions related to them.
This article is part of our free series on banking in India, including how to navigate banking in India and the NRI bank account opening requirements, click here to access more now.
Alternatively, if you’re looking to open an account with a government-owned bank, also known as a nationalised bank, you can get started by accessing our free guide linked here. It’s important to understand the requirements for submitting an application for opening bank accounts in India as a non-resident as not all banks in India accept non-resident clients.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Bank Solvency Certificate
- Why Is a Bank Solvency Certificate Required?
- How to Request a Solvency Certificate From the Bank?
- Frequently Asked Questions
- Do You Want Help Opening Bank Accounts?
Bank Solvency Certificate
Bank solvency certificate refers to an official certificate issued by a financial institution confirming the financial soundness of an individual or entity. In India, certain legal processes, government departments, and tender applications require a solvency certificate in order to be completed.
Before diving in, if this is your first time visiting GlobalBanks, don’t forget to download your FREE Non-Resident Banking Starter Guide. It’s designed to help non-residents open an international bank account in top banking hubs around the world.
Why Is a Bank Solvency Certificate Required?
A bank solvency certificate may be required during certain government and legal proceedings, including (but not limited to) submitting competitive tenders, being awarded certain contracts, and even during the process of certain visa approvals.
Fortunately, there are several ways that an individual or entity can obtain a solvency certificate, including directly from financial institutions. However, certain government departments are also able to issue a solvency certificate, including the revenue department of states.
How to Request a Solvency Certificate From the Bank?
To request a solvency certificate, you will need to meet certain requirements. These requirements typically include a completed request form, copy of identification, income information, statement of assets and liabilities, valuation of net worth, and the purpose of the solvency certificate being requested.
Of course, different banks have different requirements. In certain instances, you need to provide information about other holdings or a certificate of net worth from a chartered accountant. However, in most cases, financial institutions will only issue a solvency certificate in relation to the specific assets (and liabilities) that they have access to directly.
With this in mind, if you require a solvency certificate that includes non-bank assets (e.g. gold, real estate, and various investments) and liabilities, you will likely need to approach the revenue department in your local state to request a solvency certificate instead.
If a bank solvency certificate meets your needs, you may need to submit a formal request to the bank outlining your requirements.
Here is a closer look at the documents to obtain a solvency certificate.
Documents Required to Obtain a Solvency Certificate
- Completed solvency certificate request form
- Copy of a valid passport
- Bank account statements
- Investment account statements
- Valuation of real estate holdings
- Valuation of other investments
- Applicable insurance policies
- Certificate of net worth from an accountant
- And more
Frequently Asked Questions
Below are three of the most common questions we receive from people looking at how to obtain a solvency certificate. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
How Long Does a Bank Solvency Certificate Last?
A bank solvency certificate validity typically lasts for 12 months long. However, depending on the party requesting the certificate, it is possible that you should provide a more recent solvency certificate. With this in mind, you should carefully review the specific requirements before submitting a request.
Who Has the Authority to Provide a Solvency Certificate?
The authority to provide a solvency certificate rests with financial institutions and the revenue departments of local states, as they have the ability to assess and validate a person’s financial stability. That said, individuals (or entities) seeking a solvency certificate may also need to provide certification from a chartered accountant to accompany and support the issuance of a solvency certificate.
Does a Bank Charge For a Solvency Certificate?
Yes, banks do charge for a solvency certificate. In most cases, the cost to obtain a solvency certificate is between 300 and 200,000 rupees. The price you pay for a solvency certificate depends on the value of the assets being assessed. That said, each financial institution sets its own fees for issuing a solvency certificate, so you should confirm with your financial institution before moving forward.
Do You Want Help Opening Bank Accounts?
If so, you can access GlobalBanks Insider and start the process of applying for an offshore account in a few clicks.
GlobalBanks Insider is a dedicated account opening solution that involves direct support from our team and direct introductions to the banks of your choosing. It gives you instant access to the…
+ Direct support from a team of banking experts
+ Direct introductions to your desired banks
+ Answers to your most pressing questions and challenges
+ Expert insights on which banks to choose & why
+ Plus FULL access to our entire suite of account opening tools and intelligence!
And “yes!” GlobalBanks Insider is designed to help foreign and non-resident individuals and companies open bank accounts.
You can learn more on the products page from the main menu above.
