Opening a Bank Account in UAE as a Foreigner
Foreigners might feel the need to open a bank account for legal transactions. These could be buying real estate, transferring money to another account, and many other things. Even though it is not a difficult procedure, it is always best to work with a professional advisor. In this way, the time-consuming process can be finalized in the blink of an eye. Here’s everything you want to know on how to open a bank account in UAE.
Who Can Open a Bank Account in the United Arab Emirates?
Individuals over 21 years of age can freely open a bank account in the United Arab Emirates. Young adults between 18 - 21 years can open an account under one condition. They should be employed by an entity of government or semi-government enterprises. Children under 18 years old should open an account at the bank with their parents or legal guardians.
Why Do I Need a Bank Account in the United Arab Emirates?
Foreign short-term visitors may not need to open a UAE bank account, but foreign expats might. Short-term visitors can withdraw a certain amount of cash with the cards from their overseas bank accounts. But for each transaction, the bank might charge a transaction fee.
A great part of daily expenses can be covered via debit or credit cards. For newly moved foreigners or foreign residents, a bank account in the UAE is essential. Foreign expats can use the bank account to send high amounts of money to a UAE account or receive, pay their utility bills, and invest in local funds. Any monetary business requires a UAE bank account.
Requirements and Documents to Open a Bank Account in the United Arab Emirates
Foreigners should provide certain documents to open a bank account in UAE, like as their passport of identification and previous bank statements. While residents only need their passports with residence permits or Emirates IDs, opening a UAE bank account for non-residents might require more documents to submit.
For personal accounts applicants should submit the following;
• Copy of their passports
• Bank statements from their country of residence (Showing at least 2 months of activity, but mostly underlined as 6 months)
• A statement that includes the reason for opening the bank account
• Utility bills that indicate the applicant’s address information (For the last 2-3 months)
Foreigners can open both personal and business accounts. Each account type has its own requirement scale. The process of opening business accounts tends to be more complicated than personal bank accounts. For business accounts applicants should submit the following;
• Legal address information of the company
• Company memorandum
• Residence permits or Emirates ID documents of all administrators of the company, including the founders and CEOs
• Legal information of the company including certificate of registration, valid trade license, etc.
• A confirmation letter signed by all founders of the company to open the bank account
• Other bank account statements of the company. In the case of a start-up, all founders should provide their personal bank statements.
The required documents can differ depending on the bank. Some banks might request more documents from applicants. These could be proof of sufficient funds such as a payroll, a letter of employment, or a tax credit statement. If you work with a consultant along the way, it would be easier to find out all the requirements. Your advisor will inform you about all the necessities requested by the bank you’re applying for.
How to Open a Bank Account in the UAE for Non-Residents?
There are several steps to opening a bank account in the UAE. Firstly, it is highly recommended to work with a consultant. There are various types of banks in the UAE, ranging from Islamic banks to commercial banks. It is essential to choose the most appropriate bank to apply. A consultant would assist the applicant in the right direction.
Secondly, the advisor will help the applicant to gather the necessary documents. The documents may vary depending on the type of the application, or to the bank.
After collecting all the required documents, the applicant should be present at the appointment at the bank to proceed with transactions. If every step is followed properly, the applicant will be declared eligible to have a bank account in the UAE.
The process could take a day or a couple of weeks. Things like misleading information or missing documents could prolong the process. They can even increase the chances of a refusal. From A to Z, all processes must be conducted under the supervision of a professional, just in case. If not, non-resident bank account UAE applicants can come across certain complications while opening a bank account.
Bank Account Types in the United Arab Emirates
The types of UAE bank accounts can vary depending on the purpose and can be listed as;
• Current Accounts
• Savings Accounts
• Offshore Accounts
• Investment accounts
For everyday transactions such as withdrawing cash, account owners use current accounts. Foreigners can pay their utility bills and open a checking account linked to it. Plus, salary accounts are also considered current accounts.
Savings accounts allow the account owner to preserve their savings and can be used as a salary account. These accounts often provide higher interest rates but may come with restricted access to funds and potential penalties for withdrawals to preserve the savings.
Investment accounts allow account owners to gain profits through advantageous interest rates by depositing the money for both the short and long haul. Account owners must sign a binding investment contract stating the profit rate and everything for a bank account opening in UAE.
Expats holding a valid UAE residence visa can establish offshore bank accounts. It is mainly used for international fund transfers. Offshore banking is well known for its stability, reliability, and security. Plus, it offers additional financial and legal benefits including reduced tax rates.
Offshore accounts are more private channels to manage monetary assets. There is an array of services that come with offshore accounts. These can be sorted as asset protection and wealth management, private banking, tax advisory, estate planning, and company incorporation.
Costs of Opening a Bank Account
Opening a bank account in the UAE is costless. However, some transactions require a certain amount of fee or have money-deposit conditions.
Minimum Balance Requirement: Depending on the account type and the bank itself, the applicant can be required to obtain a certain amount of money in their bank. The minimum balance limit varies between AED 3,000 to 5,000. Depending on the account type, the minimum balance limit can rise up to AED 150,000, especially for business accounts.
Account Closure Fee: If an account holder wants to close their bank accounts, they usually pay a fee of about AED 100.
Cheque Book: Usually in UAE the first chequebook is freely given. However, for additional use, a renewed chequebook can cost around AED 25.
Statements About the Account From the Bank: On certain occasions, foreigners might need additional statements from their banks in the UAE. These could be an account balance letter, or a statement of that shows there is no liability. The cost of it is between AED 40 - 100, but often around AED 50-60.
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