Opening a business bank account in Dubai or corporate bank account in the UAE is a time-consuming process! The process demands keen attention to detail, more paperwork, proper documentation and financial statements, and much more.
What are the main difficulties to overcome while starting the process of opening a business bank account in the UAE? Let’s discuss this in detail!
In this article, you will get to know more about the challenges that an individual can encounter while establishing a bank account in the United Arab Emirates (UAE). You will also explore the reasons behind the rejections and reluctance of banks in the Emirates to open corporate accounts.
Opening bank account in UAE
Establishing a bank account in the UAE, whether you’re a resident or non-resident, presents distinct options. Residents have the privilege of accessing both current income and savings accounts, while non-residents are generally limited to cumulative, deposits, or investments. However, obtaining a current account, even for residents, can be challenging as banks tend to exercise caution, aiming to mitigate risks associated with high-risk countries. Banks maintain their own internal nationality-based risk assessments. Therefore, if you’re considering opening a UAE bank account, it’s advisable to submit your documents to multiple banks simultaneously for an increased likelihood of success.
8 tips on opening a UAE corporate bank account
Establishing a corporate bank account in the UAE offers options for various company types, including offshore, mainland, or those within free zones. However, 50 percent or more of companies encounter difficulties in opening corporate bank accounts in the United Arab Emirates.
If you are also challenging or having difficulties in opening a bank, these tips can really help you overcome the situation.
1. Get a Pre-established company with an existing business bank account!
The first option involves acquiring a pre-established company that already holds a business account. This avenue necessitates a thorough verification process.
2. Apply for your business bank account in Dubai on your own!
The second approach is the preparation of bank-related documents which is crucial to minimize any rejection and issues. It helps to ensure compliance with the UAE bank’s requirements. In this scenario, your application will undergo scrutiny to verify its legitimacy.
3. Choose the right bank.
Most importantly always try to research and select a bank in Dubai and the UAE that aligns with your business needs. Moreover, it should align with the industry and your business financial goals. You should also consider factors such as services offered by the banks, fees and banking system, and the bank’s reputation.
4. Complete your documents requirements.
Familiarize yourself with the specific documents needed for your business type. These may include business licenses, proof of address, shareholder information, and financial statements.
5. Compliance with UAE regulatory standards.
Ensure that your business setup in Dubai adheres to all UAE regulatory and licensing requirements. This includes having a valid business license and permits for meeting any industry-specific regulations.
6. Prepare a business plan.
UAE banks require that a company shows a well-prepared business plan. Banks always check that you have a clear vision and strategy for your operations as well as have a solid financial plan for a business to open in Dubai. This can enhance your credibility and increase the chances of approval.
7. Demonstrate financial stability.
You should provide evidence of your company’s financial stability during the process of your bank account opening in Dubai, which may include audited financial statements, cash flow projections, and proof of existing business relationships.
8. Consider seeking professional assistance.
The best thing to do is to seek assistance from the consultants. As they will be well-versed in UAE banking regulations. Additionally, they will guide you through the process and help ensure that all requirements are met.
Rejections on corporate bank account in UAE
UAE banks have always been stricter on their protocols for corporate bank account openings. This shift is driven by the UAE’s endless efforts to get up to the mark with European Union tax standards and distance itself from international lists of non-cooperative jurisdictions. In order to secure banks’ own licenses in UAE, they cannot open a business account that is aimed at tax optimization. To avoid the high risk of losing their license, they reject your account.
Negotiating with banks in the UAE
One of the biggest challenges when negotiating with banks in the UAE is their limited communication. This is because banks can’t give detailed advice on how to submit information. The process of opening a bank account is challenging, banks will require a standard set of documents without offering much feedback. This means clients often don’t understand why their application to open a UAE bank account might be declined.
In conclusion, opening a bank account in Dubai, UAE can be a straightforward process if you are on a residency visa and have all the necessary documentation that meets the requirements set by the bank. The account opening process typically involves submitting an application form, providing identification documents, proof of residence, and a valid visa. It is important to choose a reputable bank that offers the services you require and has a good reputation in the industry. However, it is challenging to register a bank account when starting a business in Dubai. Emirates Business Setup is here to help you open your bank account for your business. Contact us today!