3 Main Challenges Startups Face Opening an HSBC Bank Account
Updated on 23 April 2020: If HSBC (Hong Kong) rejected your business account opening application, you can either try our Guaranteed Hong Kong Business Bank Account Opening Scheme to access to other Hong Kong banks, or consider to open your bank account in Singapore where some Singaporean banks provide remote business account opening for selected clients who are not Singapore citizen nor residents. Details of Singapore Business Bank Account is here.
Updated on 16 July 2018: We found that some Hong Kong banks are more open to Hong Kong and overseas companies with non-Hong Kong residents directors and/or shareholders, details are here.
After a year of trial-and-error in Hong Kong, we (Asia Business Centre – a corporate service provider in Hong Kong) could conclude that Hong Kong HSBC has tightened the KYC / due-diligence requirement of HSBC business accounts opening to new level of difficulty. If you are going to apply for a bank account for your new company / corporate, we hope you are well prepared for accordingly.
Remark: KYC is the short form of Know-Your-Client by which the banks verify the identity of accounts owners.
#1: HSBC accepts only phone appointment for account opening
Unlike its personal banking sector which accepts online appointment and walk-in applicants, HK HSBC needs every account opening applicants phone its Commercial Banking Application Hotline (+852 2748 8282) within office hours 0900-1800 local time for appointment of a bank interview. “Sorry, no walk-in applicants and no online appointment scheduling.” says HSBC.
In addition, the phone operators can speak fluent English, Cantonese and Mandarin (Pu Tong Hua).
#2: Phone interview challenges every startups and small businesses
When your conversation between HSBC begins, HSBC need you to answer a series of questions about your business and your identity. Unfortunately, lots of applicants are turned down here.
This questionnaire aims to screen OUT applicants who are NOT able to provide the documents and proof as follows:
- Identification document and Nationality proof of all directors and shareholders (i.e. Original HK Permanent ID card and and/or Passport of them who are require to show up in the later bank interview in Hong Kong)
- Residential Address proof (i.e. Utility bill and / or Bank statement with your name and address which MUST be the same as the the residential address you used to incorporate.)
- Original Incorporation document & Business registration document (i.e. Certificate of Incorporation and Business Registration Certificate for Hong Kong companies, equivalent documents for companies of other jurisdictions)
- Certified copy of Original Incorporation document & Business registration document
- Company stationary (i.e. company “chop” / company stamp, common seal – optional, Articles of Associations or equivalent)
- Business plan & proof (i.e. Ownership Structure Chart, Source of funds, information of products, your client & supplier list, financial forecast, invoice & receipt)
- Business address proof: It must be a Hong Kong address in commercial area (i.e. tenancy agreement bears your name)
- Business employment proof: Employment contracts with persons who are residing in Hong Kong as proof that your business has solid operation in Hong Kong is required.
Point 1 to 5 are reasonable and simple to handle. However, point 6 & 7 are very difficult to deal with for new or overseas business owners. If you answer “No” anyone of them, your application ceases and no interview will be arranged. You can phone again later when your application can fit this requirement but most applicants give up and feel angry with HSBC as well as Hong Kong.
#3: “Meet the HSBC banker” is a stressful interview
After your appointment is scheduled, you need to make sure all directors and shareholders of your business are physically present in Hong Kong to take part in the bank interview which is held in one of the HSBC branches in Hong Kong. The interview can be conducted in English, Cantonese and Mandarin (Pu Tong Hua).
Be reminded to make the documents certified in advance. If the documents are not written in Chinese or English, make them translated in English or Chinese by the consulate of your country or PRC consulate respectively, and make them certified as well.
Nominee signatory, directorship and shareholder-ship CANNOT help here. During the interview, HSBC banker asks if these people are the ultimate beneficial owners and your nominee should expose themselves to avoid legal responsibility.
The KYC needs the banker to go dig deep on all the documents and proof. All of you should be questioned by the bankers for every documents and proof submitted.
Our final thought, the interview is a formal and serious business meeting, any unconformity or careless mistakes can put all the effort in vein.
Usually, the meeting lasts for one hour, a lot of details are touched during the conversation. Formal dressing, displaying a professional attitude, thorough understanding of your business, and humble language are the basic requirements.
We want to share our first hand experience of HSBC commercial bank account opening here because we want more oversea business can do business in Hong Kong. In addition, HSBC is a truly global brand in banking, every expats we met mention this bank for their personal and business accounts before they start their business here.
However, HSBC is also “closely monitored” by bank regulators everywhere. It has introduced stricter KYC policies to cope with the US’s FATCA compliance and OECD’s CRS standard in expense of entrepreneur, startups, overseas business and eventually the reputation of Hong Kong where is the most business-friendly place in Asia to do business so HK government would have us believe.
As an experienced a corporate services provider in Hong Kong, we offer Hong Kong bank account opening arrangement service, we refund (up to 100%) our service fee if your commercial account application in Hong Kong is not fruitful. Apart from HSBC, you can find a dozen of reputable banks for commercial account opening such as Heng Seng Bank.
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[…] Update on 7 July 2016: HSBC Hong Kong has tightened further its commercial account opening requirement, we have seen that new entrepreneur and startups from either Hong Kong or overseas have been rejected by the bank regarding their commercial account opening. More info is available in this post. […]
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