While Denmark’s economy and high standard of living make it a popular destination for foreigners, it’s an expensive and bureaucratic place to live — and the same principles apply to Danish bank accounts.
But bureaucracy aside, banking in Denmark attracts attention from foreigners for a few very good reasons. For example…
During the last financial crisis, Denmark (and other Scandinavian countries) were relatively unaffected compared to their European peers.
Denmark also offers diversification for those overexposed to EUR, GBP, or USD.
Finally, while Denmark is not an offshore banking hub by any stretch of the imagination, banks here are well managed and offer solid products and services.
So what’s the problem?
The largest bank in Denmark, Danske Bank, was at the epicenter of the largest money-laundering scandal in Europe… ever.
And at the heart of this scandal were non-resident bank accounts.
So it’s no surprise that Danish regulators (and the banks themselves) are apprehensive when it comes to opening non-resident bank accounts.
But there are still a handful of account opening options available for motivated foreigners who really want to open a Danish bank account.
In today’s article, we’ll shed light on the account opening process, explore differences between resident and non-resident accounts, and dig into some of the obstacles non-residents face.
It can be complicated to get started, and many banks will charge you for most of their services, but once you get your ducks in a row, banking in Denmark can often make your life easier.
First, let’s take a look at who can open an account and the steps involved.
Not just anyone can open a Danish bank account. To be eligible, you need to be a resident of the country (staying in Denmark for at least three months and having a residence permit or EU residence document).
Even if you’ll be a resident in the near future, you won’t be able to open a Danish bank account until you’re there in person. Some banks let you start the registration process online, but you’ll have to go in-person to a branch to finalize your paperwork.
But if you’re a resident who lives and works in Denmark, you need to open an account as soon as possible. Since your employer must deposit your paychecks into a Danish bank account, you can’t get paid until you have one.
First, register for a civil registration (CPR) number, a ten-digit registration number that’s a unique identifier for all Danish residents.
Once you’re registered in the CPR system, you’ll receive a yellow health card called a sundhedskort, which gives you access to medical treatment in Denmark.
This number is mandatory for all Danish residents, so it’s a good idea to get one as soon as possible. You’ll need it to open a bank account, pay taxes, access your health insurance, and anything else involving interaction with government agencies.
Once you’ve got your CPR number, opening a bank account in Denmark looks much the same as anywhere else.
You must present your yellow health card as proof of your CPR number, plus proof of identity and residence. Check with your chosen bank for a list of required documents, but here are a few things to note:
Next, set up your NemID, which is the secure login information that lets you access your account and other financial records (like your tax information) online.
You’ll receive a username, password, and a “code card.” Once you have a NemID, you can access your bank from any internet-enabled device.
A NemKonto, or “Easy Account,” is your designated bank account for public sector payments like tax refunds, subsidies, and child benefits.
Denmark introduced the NemKonto to help digitize the Danish public sector. It’s an easy way for individuals to receive money from public institutions without visiting a bank in person.
The easiest way to set up NemKonto is to use your NemID to log into the self-service site. You can then assign your bank account as your NemKonto, free of charge.
Once you’ve created an account, obtained your NemID, and linked it to NemKonto, you should be ready to bank in Denmark!
As a general rule, there are no longer checks in Denmark, so you won’t get a checkbook with your new account. Danish banking takes place digitally or in cash.
You can request a Dankort (a Danish debit card), and you can also request a credit card, which will take several more months to arrive.
Before diving in further, if you’re interested in opening non-resident bank accounts that meet your specific needs, we encourage you to download a FREE copy of the Non-Resident Banking Starter Guide.
There are two broad categories of banks in Denmark: national and international. Of the national banks, many offer free accounts, but Danish banks have a reputation for charging fees for many services.
Once you’ve opened a Danish bank account, you probably won’t need to visit often, since most transactions are digital. If you do need to visit a branch, keep in mind that Danish banks are open from 10:00 to 16:00, with some branches staying open to 17:00 on Thursdays.
Also, remember that while most branch employees speak English, not all online banking is available in English. Be sure to ask about online language options before setting up an account.
While central banks everywhere are considering low rate and negative interest rate policies to encourage lending and economic activity, a few countries have led the charge. Among them, Denmark and a handful of other European countries and Japan.
In Denmark, it all comes down to where you bank, whether it’s your primary personal (NemKonto) account, and how much money you have in the account.
For example, Danske Bank announced in June 2020 that customers with over 1.5 million DKK (approximately 200,000 EUR) in a NemKonto will pay interest of negative 0.75%. And the same rate will apply to non-NemKonto accounts of more than 750,000 DKK (approximately 100,000 EUR).
But Danske Bank isn’t the only culprit. Four other Danish banks have also introduced negative interest rates, making them a mainstay of banking in Denmark.
If you’re working in Denmark, it’s worth your while to open a Danish bank account as a foreigner, since you’ll need one to receive your paychecks.
And once you set up your account, you can enjoy the many benefits of Danish banking.
Thanks to the NemID’s universality, you’ll have the same secure login information not only for your bank but for engaging with public authorities and dealing with other businesses that use the NemID. And with the NemKonto system, you’ll have an automatic location for public sector funds to be deposited into your account.
While it can be complicated to open a Danish bank account as a non-resident, it is possible. But you’re not going to be able to walk into a branch off the street.
Though the benefits of doing so are questionable given the prevalence of negative interest rates and the sector-wide disdain for non-resident foreigners.
Make no mistake, the process is tedious — from registering your CPR number, to setting up your NemID, to designating a NemKonto, and negotiating your way into an account — but in the long run, you might find a Danish bank account is exactly what you’re looking for. Or not?
Much like the nation itself, it can be expensive and bureaucratic to get open a Danish bank account. But, once you finally get situated, you can enjoy streamlined efficiency and benefits of banking with solid banks.
If you’re seriously motivated and want to open a bank account in Denmark, we can help you find and open bank accounts in Denmark (or elsewhere) that meet your objectives.
If you want to know which specific banks will accept you, which account opening strategies to use, how to avoid high fees, and overcome tough paperwork requirements, then we’d be happy to help you on your journey.
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