Have you tried to open a European business bank account online? Welcome to the jungle.
Whether you’re an entrepreneur, business owner, startup founder, or have an international business, you probably know how tough opening normal business bank accounts can be. But, opening corporate accounts like a European business bank 100% online is often challenging.
KEY TAKEAWAYS
- You can open European business accounts online
- Account options range from digital to traditional bank accounts
- Business account benefits include SEPA transfers, strong banks, and more
- Available account services will depend on the bank & country
- Opening an online account is not common practice in all EU countries
- Bank selection is key as many EU banks don’t open online
- Businesses will likely need to demonstrate a local connection
- Documents for opening an account will vary between countries & banks
The internet is littered with stories about being rejected a bank account, non-resident companies being given a flat-out “no,” and business owners spending (and losing) thousands during the process of opening an account.
With that sort of introduction, you’d probably think that all hope is lost. But it’s not…
In this article, we’ll explore the best ways to open an account online, the benefits, how to do it, and what you MUST watch out for. This is all based on our team’s experience helping members who successfully opened an account online in Europe.
But before diving in, download your FREE copy of the Business Banking Starter Guide. It shares useful, lesser-known tips that international businesses and foreign companies can use when opening business bank accounts abroad.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Can You Open European Business Bank Accounts Online?
- Europe’s Fintech Frenzy
- Who Should Open an Account Online?
- Why Open a European Business Bank Account?
- Why Do People Fail at Online Account Opening?
- Ready to Open an Offshore Bank Account?
Can You Open European Business Bank Accounts Online?
Yes, it is entirely possible to open European business accounts online as long as you choose the right bank, meet the bank’s account opening requirements, and have a suitable client profile. Bank selection is key as not all banks in Europe accept non-resident businesses. Knowing how to choose the right financial institution is critical in successfully opening a bank account in Europe.
Whether or not your company can open a European business bank account online highly depends on various factors, which we will discuss in further detail below.
Each business bank and fintech has different opening requirements. And, business banking is getting increasingly difficult due to changing banking regulations and tougher compliance procedures for opening an account.
Whether or not your company meets the bank’s criteria depends on where you’re from, where your company is registered, how much money you have, what ties you have to the country the bank is in, and whether or not you can acquire the right paperwork.
For instance, if you’re looking to open a bank account in the UK for an American company, it will be difficult. But, if you have a British passport or are a British national, it will be much easier.
The same goes for opening an account with a business bank in other countries like Germany, Spain, France, Portugal, and so on. So how can you open the bank account you need?
Here are the steps:
- Research the best business bank for your company. Consider your business needs and what type of account would be most beneficial for you. There are many different types of accounts, from simple current accounts to more specialized accounts like investment accounts or forex accounts.
- Research the bank’s opening requirements. Each bank has different requirements, so it’s important to make sure you can meet them before beginning the process of opening an account.
- Gather the required documentation. Once you know what the bank requires, gather all of the necessary documentation. This may include items like your passport, company registration proof, proof of address, and more.
- Start the opening process. This will vary depending on the business bank, but usually, you can begin by filling out an online application.
- Follow the bank’s instructions. Once you’ve submitted your application, the bank will likely require additional documentation or may request a meeting. Follow their instructions to complete the process.
What Else Do You Need to Know?
Analyzing each bank’s opening procedures, document requirements, specific sensitivities, likes and dislikes, and the experiences of companies similar to yours is key.
It also helps if you know what your peers are doing, where they’re opening, and what problems they’ve faced when opening an account.
With this in mind, selecting the right country and the right bank is critical to getting your account open. If you choose incorrectly, you’ll either get rejected or end up with a useless business account that you can’t even use.
Typically, the most undesirable accounts will have high fees, horrible services, and lack basic functionality (think: no online banking, no debit card, or major currencies), and you’ll pay above-market fees to open, close, and maintain it.
In the digital space, you’ll want to be careful not to open a business account with constant fund holds, compliance investigations, and sudden terminations that are becoming increasingly common.
In a nutshell, there are six ways to open a bank account:
- Traditional business bank
- Digital bank, EMI, money services business, payment platform – without a banking license
- Digital bank, EMI, money services business, payment platform – with a banking license
We detail the other three ways to open a bank account with our GlobalBanks members in our banking intelligence reports, which share specific strategies and tactics for opening accounts with specific banks and countries.
Europe’s Fintech Frenzy
Unless you’ve been sleeping under a rock for the last five years, you know that Europe is in the midst of a digital banking frenzy. From Lithuania to the UK and everywhere in between. New platforms, e-money institutions (EMIs), money service businesses, payment systems, and free online banks are popping up left and right.
There are thousands of them… and, it’s hard to know which (if any) you should trust.
Some of them have banking licenses, some don’t. Others don’t even have IBANs. Some can’t even transact in US dollars. Many of these companies are notorious for business account freezes, sudden shutdowns, and backfiring when you need them most.
But, what’s worse?
Many European fintechs are entirely reliant on ONE German company for their infrastructure. And, that German company was accused of fraud and had its CEO arrested… in case you didn’t hear they lost around $2 billion dollars.
So where does that leave entrepreneurs and business owners who still need to open a business international banking account or a business IBAN account in Europe online? And what options exist for anyone wanting to open remotely or online?
Well, that mainly depends on your background and what type of business you have. So with that in mind, let’s take a look at who should be opening European accounts online in the next section…
Who Should Open an Account Online?
Generally, four groups typically want to open a euro business account, specifically the best business bank account in the UK.
Some are EU citizens or residents, while others aren’t. Some have EU-registered companies, while others have foreign companies.
Who Can Benefit Most From European Business Bank Accounts
- Digital nomads, expats, & freelancers
- Non-EU & offshore companies
- International businesses doing business…everywhere
- Businesses with European customers
- UK Business in need of post-Brexit banking
- Businesses in need of an EU payment card for expenses
Here are the four groups:
Group #1: Entrepreneurs & Small Businesses Owners in Need of an Account
Included in this group are digital nomads, expats, life coaches, drop shippers, Amazon FBA sellers, online business gurus, subscription businesses, software developers, freelancers, and startups.
Group #2: You Have a Business Fintechs Hate
This group includes non-EU companies, offshore companies, investment funds, small fund managers, traders, high-risk businesses, and businesses with no ties to any EU country.
Group #3: You’ve Outgrown Fintech (e.g. Revolut Business Account)
Fintechs either reject you, constantly freeze your business account, or just have too many limitations. Though free, businesses on a serious growth trajectory, transacting in high volumes, or in certain industries, often need a more sustainable option. So even if you have a virtual bank account like a Revolut business account or a Wise business account, you may be looking for a different solution.
- Outgrown Paypal, N26, Revolut, or a similar fintech app
- Business platforms don’t like or are a compliance risk
- Restrictions and limitations for transaction size, frequency, & volume
- Can’t get past the initial app onboarding process
- Require a payment card for each employee & manager
- Free banking apps can’t offset banking disruptions
Group #4: You’re a Student & Need an Account in Europe
You are studying at a European university or college and want a bank account and bank card before you arrive. This will make it easier to pay your tuition, rent, and other expenses. Additionally, having an account will help you get a mobile phone plan and set up other utilities.
Why Open a European Business Account?
Why do people and companies want to open euro business bank accounts?
Reasons range from raw business utility to diversification, safety, backup accounts, payment processing, merchant services, affordability, and opportunity.
Low-cost SEPA transfers within Europe
International wire transfers from non-EU countries are expensive. So, certain companies open bank accounts to get access to SEPA and slash their transaction fees.
This might be highly desirable for foreign companies from countries without SEPA. Especially, those countries not yet supported by Transferwise or that have exorbitant wire fees for transfers, horrible conversion rates, and high rates of lost wires. SEPA access solves all of these problems.
Can’t travel & need to open remotely
Sometimes, paying a personal visit to a European bank just isn’t realistic. Maybe you’re too busy. Flights are too expensive. You can’t get a visa. Or, there’s a global pandemic.
If you choose the right bank and know what you’re doing, opening business bank accounts online in Europe can be easier, faster, and way less expensive. But, the opposite is true as well, so choose wisely.
In some cases, you may even be able to receive a debit card while outside of the EU. However, in most cases, you still need a local (EU) address to receive the card. So, if this is important to you make sure you have a secure EU address where you can receive the payment card before you start applying for accounts.
Backup business bank account
Some entrepreneurs want to open a European business account online because they want a backup banking option for their company. For example, if your current business account is frozen, gets shut down, or has a major disruption– you can just shift your business to your backup bank account instead.
Diversification
Some businesses want to open bank accounts for diversification purposes. Whether that diversification is geographic, economic, political, or currency-focused varies.
For example, some entrepreneurs hate the idea of holding 100% of their company’s cash in a single country or single bank. If the country is unstable, has unpredictable laws, has failure-prone banks, or is known for ambulance-chasing lawyers and frivolous lawsuits– keeping some of your company’s cash abroad just makes sense.
Additionally, some companies want to open a foreign SEPA bank account to protect themselves from their home country’s currency. If you think the USD or GBP will devalue, but the EUR is going to hold steady or increase in value– holding some cash in euros outside of the US or UK could be a good idea.
Access to European Payment Processors, Transfer Services, Online Marketplaces
For some entrepreneurs and companies from non-EU countries, business bank accounts in Europe are a golden ticket.
With a European business account, you can access European payment processors, merchant services, transfers, online marketplace (like Amazon), and get a debit card. Plus, having access to the currencies, services, and payment methods that your customers actually want is key.
Profitable Arbitrage Opportunities
Some entrepreneurs open business bank accounts online to take advantage of certain arbitrage opportunities that aren’t available in other countries.
For example, government regulations in Europe keep prices artificially low for certain types of banking activities. Payment processors have to keep fees below certain amounts. And bank to bank transfers within the EU is regulated.
European payment processors are sometimes more lenient. If you’re a new company with high transaction volume, some European payment processors may be easier and cheaper to deal with. Whereas in the US, you’d have your business banking account frozen every few months, constantly have to send supporting docs, and pay double the fees, their European cousins are sometimes more laid back. This alone can boost profits.
Bank Stability & Deposit Guarantees
If you’re from a non-EU country with unstable banks, high corruption, and an unpredictable currency– being able to open business bank accounts online in Europe to protect your money can be a godsend.
In fact, it might also be the only way for your business to access a stable bank with deposit guarantees up to €100,000.
Keep in mind that, in case of bankruptcy, Europe has a “bail-in” system in place. So, if a bank fails– shareholders and creditors are on the hook before taxpayers. This makes European banks much less likely to fail than their counterparts in other countries. At the same time, common sense would say (hope) that the management of such a bank is probably more risk-averse and diligent. In either case, you should always be wary of where you deposit your money.
Why Do People Fail at Online Account Opening?
Many entrepreneurs and businesses end up rejected for an account for entirely avoidable reasons. Here are the top reasons why businesses fail to open an EU bank account.
- Misunderstanding (or ignoring) the bank’s account requirements before applying
- Overlooking the bank’s sensitivities & concerns
- Not realizing that an in-person visit is still actually required
- Not getting the right paperwork before applying for an account
- Applying the wrong business structure
- Your business appears high-risk and sketchy… when it isn’t
- Applying for an account and then having to close it
- Discovering your business can’t meet the minimum balance or turnover requirements
- Realize the fees are insane AFTER opening the account (and then having to close it)
In GlobalBanks Insider, we get granular, giving you the tools, information, and support you need to open an account and navigate the international banking world.
Discover what the biggest pitfalls and stumbling blocks are in specific countries, banks, and even certain branches before applying for an account.
Don’t go in blind. Don’t waste your applications. And stop repeating the same mistakes over and over again.
Here’s the nightmare scenario…
If you get rejected at your “dream bank” because you made a careless mistake or didn’t know what you were doing– you just lost your chance at opening a bank account there.
And, that’s a huge problem. Sometimes, there are only one or two banks in an entire country that’ll work with your business. If you go to the wrong branch or the wrong banker or don’t have the right documents going in– you’ve essentially blacklisted yourself and eliminated that bank as an option for your company.
A lot of business owners and entrepreneurs are brilliant when it comes to business– but they don’t know about the nuances of opening an account and business banking.
Ready to Open an Offshore Bank Account?
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.
Use this link to see how GlobalBanks Insider can help you successfully open accounts.
