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19 Aug

FTAHK Guidance: Opening a Bank Account in Hong Kong as a FinTech Business

Hong Kong has one of the most dynamic and thriving startup ecosystems in the world, at the heart of the Greater Bay Area and unrivalled as a gateway to China. However, startups often face significant challenges when opening a bank account in Hong Kong, which can be a major sticking point when launching. This is because banks are subject to rigorous anti-money laundering and counter-terrorist financing requirements that if breached, can damage their reputations. Despite this, there are steps you can take to smooth the process of opening a bank account in Hong Kong. They start with looking at the challenge from the banks’ point of view.

This document includes the valuable insights of major banks, tech companies (including start-ups) and professionals in the arena and was coordinated by our Policy & Advocacy Committee. We look forward to continuing our work with the industry on ongoing collaborative initiatives

Hong Kong has one of the most dynamic and thriving startup ecosystems in the world, at the heart of the Greater Bay Area and unrivaled as a gateway to China. However, startups often face significant challenges when opening a bank account in Hong Kong, which can be a major sticking point when launching. This is because banks are subject to rigorous anti-money laundering and counter-terrorist financing requirements that if breached, can damage their reputations. Despite this, there are steps you can take to smooth the process of opening a bank account in Hong Kong. They start with looking at the challenge from the banks’ point of view.

Banks are in the business of providing services to real businesses for a fee, meaning the process of opening an account is primarily about learning and collecting evidence that your business is real, invested and run by ‘real people’. This process has become very important for banks, particularly following recent scandals, fines and an increase in regulatory oversight. In addition, banks that operate globally often need to comply with the regulatory obligations of a number of jurisdictions, which is a time-consuming and costly process for them.

When going through the bank account opening process, be prepared therefore to demonstrate how you have built the right compliance resources, policies and controls within your business to safeguard your customers and company. This will assist the bank in considering whether to onboard you, or whether the relationship will create a risk that they are not willing to accept in light of international regulatory obligations and business/cost considerations.

There are a number of practical steps you can take to speed up and ease the process:

1.      Find the right bank and the right person within it, and explain the business simply (i.e. how you get paid for services that a group of customers want)

2.      Collect all your information that shows who owns, operates and controls you

3.      Polish your business plan so the bank can understand the nature, scale and risks of your business

4.      Put together a proposal that explains the rationale of your business, who the people behind it are and where you see it going

5.      Get your people together on the ground and be willing to have a face to face meeting with your bank in Hong Kong

6.      Open more than one bank account, as this helps to guard against the risk to your business when an account is closed

All of this may sound daunting, but the FinTech Association of Hong Kong has developed an informative step-by-step guide for start-ups on how to navigate the account opening process and to maintain it once opened: https://www.ftahk.org/publication/ftahk-guidance-opening-bank-account-hong-kong-fintech-business

This document includes the valuable insights of major banks, tech companies (including start-ups) and professionals in the arena and was coordinated by our Policy & Advocacy Committee.   We look forward to continuing our work with the industry on ongoing collaborative initiatives