As mentioned in the previous article, banks are now adopting the KYC (Know Your Customer) procedures to decide whether to accept a bank account applicant as a customer. The KYC process is challenging and everyone who tries to apply for a business bank account should be well prepared for it.
1）Company Documents
- Company Incorporation Certificate
- Up-to-date Business Registration (some banks require the business nature be shown on the Business Registration)
- Incorporation application form (NNC1) and, if the company has been incorporated for more than one year, the latest annual return (NAR1) is also needed
- If there are any changes to the company after incorporation (e.g. transfer of shares or appointment or removal of directors, etc.), the relevant documents must also be submitted.
If you hired a professional company to set up the company for you, these company documents should be well ready.
2) Personal documents of directors, shareholders or beneficial owners
- Proof of identity : Hong Kong identity card, passport, etc.
- Proof of residential address : could be bank statements, utility bills, etc. The document must be in Chinese or English, show name of the applicant, full address, and issued date (must be within the last 3 months).
3) Proof of business
This is the most difficult part of the process for many people. The general principle is that you have to prove to the bank that the company has a genuine and legitimate business. The bank will expect documents such as contracts, invoices, receipts and even shipping documents. Certainly, it’s hard to prove that the company has just been set up and the bank account is still under application.
If you have another company that does related business and you are a shareholder or director of that company, that company is considered a related company. The business documents of a related company can also be used as proof of business for the new company. Simply explain to the bank why you want to set up a new company, usually for reasons such as “business expansion” or “business restructuring”.
If you are an entrepreneur, it may be more difficult to provide proof of business, but there is hope. We have the following suggestions.
1) Prepare a business plan to help the bank manager understand your business model and to more effectively convince the bank that your business is viable and feasible.
2) Prepare a curriculum vitae to demonstrate that the applicant has the relevant academic qualifications or has extensive experience in the industry.
3) Do the preliminary work for the operation：
– Sign the documents (letters of intent, contracts or even invoices) with suppliers or customers in advance, if possible.
– Set up a website if the company intends to have one.
– If you are running a retail business, rent a shop or office space in advance.
– If you have already launched your own products, you can provide the relevant information to the bank.
– If you are in the business of software production, you can provide the bank with the software interface;
The above are just a few examples. In general, the idea is that you need to prove to the bank that your company has everything in place and that all it needs is a bank account to start operating immediately, which will give you a much better chance of success.
Next time, I will give tips on how to increase the chances of success in applying for a bank account.
Formation Kit is skilled and experienced in helping customers opening company bank accounts. If you need any further information, please feel free to contact us.
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