Offshore banking is a topic we have covered extensively here at Nomad Capitalist. It can be a time-consuming and frustrating process if not handled properly.
We find that often it’s not unwillingness that is stopping people from investing abroad but paralysis by analysis and the sheer amount of time necessary to get started.
With so much choice, the last thing you want is to make the wrong decision and waste your time. Your time is valuable. An hour squandered on pointless bureaucracy means lost effort that could have gone into increasing your bank account balance.
This article will guide you through the process with tips and advice on opening an offshore bank account quickly and efficiently. It also offers guidance on the best countries to choose from.
If you want to take the next step and find out about our bespoke offshore tax planning, financial services, and asset protection strategies, get in touch here.
How to Open a Bank Account Remotely
The dream is that you can just sit on your couch, fill out some form, send it through the mail, and the bank immediately reviews it and accepts it.
Sadly, it is becoming more difficult and the fees are increasing. By the time you’ve paid the charges (account opening, monthly, online banking, bank transfers, and FATCA fees, to name a few), you might as well just have flown in and enjoyed a nice vacation.
Not only that, but those banks have higher due diligence standards as they’re not seeing you in person. So, they’re likely to take much longer than a day, even if your involvement does not take as long.
How to Open a Bank Account In-Person
This category includes those that consider themselves “offshore banks” and regular retail banks:
The banks that cater to foreigners tend to be in Switzerland, Luxemburg, Singapore, or any of the big banking countries. Given that they’re bound to get clients from all around the world, with all manner of backgrounds, their vetting procedures are stricter than with other more traditional banks.
What this means for you is that they must dedicate more resources to check your background, and your time is wasted with this bureaucracy.
The slight way around it is if you can prove some sort of connection to the country, like real estate; but that kind of defeats the purpose of “banking offshore” when you’re really just banking within your jurisdictional shores anyway.
Retail banks are run-of-the-mill banks that just so happen to be able to give anyone, even a foreigner on a tourist visa, an account. They often actively shy away from the offshore label.
Funnily enough, a bank even got mad with me once because I praised them on this website for their “offshore” capabilities.
But for practical purposes, for any non-local account holder, they can treat it as an offshore bank, as it’s a depository entity in another legal jurisdiction from their own. They are also frequently faster and cheaper than the ones supposedly designed to cater to foreigners.
It’s worth mentioning though that not every country has the regulatory ability to do this. But among the ones that do have the capability to get you up and running within a 24-hour period, Georgia and Armenia are your best options.
There may be some additional details to clear out, like getting the debit card and the online banking details. But for the most part, you’ll be done within a day.
Go For Effective, Not Flashy
Did you know that the supermarket’s own brand of groceries often comes from the exact same factory as the ones with the name brand?
People often value brands more than they actually value the product. But business decisions and investment opportunities should be decided on their merit, not on how flashy they are.
The same thing happens with offshore banking. People immediately go to one destination because it has brand recognition, not because it’s inherently any better than other alternatives.
Georgia and Armenia aren’t going to win any “Offshore Banking” awards – heck, they’re likely not even on the list! But precisely because of this, they are able to fly under the radar and they’re able to offer hassle-free accounts for whoever is interested.
More well-known destinations face international scrutiny, and thus they must comply with global banking agreements or risk sanctions. They also have a reputation to uphold, so they can’t just accept anyone. Their prospective customers have to be properly vetted, which takes time and money.
Why would you want to increase the number of eyeballs looking at your financial affairs than is strictly necessary to comply with the legal requirements?
Other than brand recognition and being able to feel like a Bond villain, these well-known jurisdictions offer comparatively poor value for money, disregard for your time, and often bad service.
No matter how rich you are, in places like Hong Kong and Singapore, you’ll always be a guppy in a sea of billion-dollar whales. It’s more time-consuming than it’s worth, quite frankly.
Why not go somewhere where you’re treated best, somewhere lesser-known where you can have the red carpet treatment instead? In these places, you’re likely to be their most important client and they will often bend over backward to keep you happy.
Once something goes on everyone’s radar it becomes more scrutinized and everything becomes far more complicated. Far from finding ways of complicating our lives, we want to make them easier.
The Nomad Capitalist philosophy is about living life on your own terms and not being beholden to third party interests. If you do stuff differently, you will get better and faster results.
What Is The Best Offshore Bank For Me?
Like most things in the offshore industry, knowing which offshore bank is best for you will depend on what you want and what you need.
If you’re looking to open an offshore bank account for your business or need help deciding where to open a personal account, feel free to reach out here.