One doesn’t need a degree in finance to realise that holding a bank account in Europe can be very convenient and save one a lot of money. Those living in the EU can bank in any country of the bloc, but opening a non-resident bank account might be somewhat tricky. In this post we explore the challenges and benefits of banking in Europe and explain how to open a European bank account as a non-resident. We also offer some tips on how to efficiently send money from Europe and not pay a fortune in fees.
In these turbulent times, the European financial system remains one of the strongest in the world, boasting a stable currency and a reliable banking system with solid protection mechanisms in place. As of recently, the latter has also become known for its rigorous policies, especially when it comes to clients’ financial transparency. Following a number of major money-laundering scandals, today opening a European bank account for non-residents may not be that easy – but still possible if you are able to prove the legitimacy of your case.
Each country and bank apply their own KYC (know your client) procedures and those that offer bank accounts to non-residents each set different terms. Therefore, you first need to identify the purpose of holding a bank account in Europe and then compare the options available to you.
Who needs a non-resident bank account
A rule of thumb is that a non-resident wishing to bank in Europe must have close ties with the country (or be super rich, but that’s a topic for another blog post). Let’s have a closer look at what those ties might be.
Usually, the bank you would like to open an account with expects you to financially engage with local persons or organisations in some way or another and be able to prove it. Some of the examples of ‘eligible’ non-resident clients would include:
- Entrepreneurs and freelancers dealing with customers and/or providers in Europe
- Asset holders/managers aiming to diversify their portfolios
- Frequent travellers, even for tourism purposes.
Why is it worthy to have a European bank account?
Even if your particular case is not on the list above, but you still feel it might stand the KYC scrutiny, do not hesitate to reach out to the bank and discuss it with them. It is worth a try because a bank account in Europe comes with many benefits, such as:
- Quality service and a wide range of products and services
- Security, which is strictly regulated at the European level
- GDPR protection of your data
- Access to the crypto market. While this is a relatively new field, many European banks are starting to offer crypto products and services.
- Less fees for payments and transfers across Europe. Moreover, a parallel ecosystem of dedicated money transfer services offers non-resident holders of bank accounts in Europe very attractive terms to send money internationally (more on that later).
Where to open a non-resident bank account
Keeping in mind the ‘close ties to the country’ mentioned earlier, banks in some European states are much more open to foreign customers than in others. For example, the Scandinavian countries are known to be very reluctant to open bank accounts for non-residents. In Germany, it is mostly the so-called ‘direct’ (online) banks that a foreigner can hope to sign up with, but even with those only a minority will get through the KYC procedures.
On the other hand, there are countries that allow foreigners to open a European bank account with no hustle. Perhaps, Estonia immediately springs to mind, known for its very progressive ‘online’ e-resident scheme aimed at modern-day digital nomads. A word of caution here: e-residency does not grant any rights to open a non-resident bank account in Estonia and, in fact, the banks there are like those in Germany in their approach to foreigners.
In comparison, Slovenia is much more welcoming: here even tourists might be eligible for a European bank account, although this option is only offered by some banks. Usually, you need to visit the bank branch in person, but the procedure is straightforward and takes about an hour. The required documents usually include a proof of identity (passport) and tax residency as well as a Slovenian tax identification number.
Banks in Italy and Spain, for instance, offer a special type of non-resident bank accounts called conto corrente non residenti and cuenta mundo respectively. Keep in mind that while you can apply online with some banks, in most cases it is usually done in person.
Ireland is another EU country whose banks routinely serve non-resident customers. No surprise here, considering its booming IT sector with the biggest names in the industry hiring talent remotely from all over the world. As a rule, you need to provide proof of ID and proof of address. Notably, with the Bank of Ireland, for example, it is possible to open a European bank account online, but in this case, you will be required to submit scanned copies of not one but 2 different documents confirming your identity and address.
Cyprus and Malta, two EU island states known for their lax banking requirements, used to be the go-to destinations for foreigners wishing to open a bank account in Europe. However, the widespread abuse of their banking systems in the past has led to the introduction of much stricter KYC policies. Today, the two countries still allow opening of European bank accounts for non-residents, but one should be ready for rigorous checks and some serious bureaucracy there.
Language and formalities
Even though the very case of a non-resident bank account implies dealing with foreigners, not all European banks have staff who speak your language or even English. This is especially true for countries such as Italy or Spain. Therefore, in your interactions with the bank, you might want to have next to you someone who can translate for you if needed.
Further on, keep in mind that the documents you submit to the bank usually must be in the local language. Which means you will have to have them officially translated beforehand. In some cases, those must also be certified by the police, a solicitor, or other similar authority. Is holding a non-resident bank account expensive?
If you are used to the relatively ‘free’ banking in your home country, the situation might be strikingly different for opening a European bank account as a non-resident. Fees and charges vary at each bank, as does the selection of services the banks offer to foreign customers. For example, with some you may not have access to your account online, others only provide debit cards but not credit cards, still others do not grant the option of money transfers online or would not work with popular wallets.
In any case, before you decide – first on the country and then the bank – make sure you check if the bank’s offering and requirements are suitable for your specific needs and resources. Otherwise, you might find yourself in a situation where all the time and effort spent on opening a European bank account (online, even) come to nothing because of exorbitant fees or stringent demands.
Sending money from Europe
In addition to the benefits mentioned above, a bank account in Europe enables its holder to take advantage of top-notch fintech solutions. In particular, to send money online – internationally, instantly, and with next-to-zero fees.
For example, Profee is a money transfer system that allows you to send money from Europe to over 55 countries around the world. It conveniently works both as a website, www.profee.com, and an iOS/Android app and once you have logged in, you can seamlessly switch between the two. The registration is with your phone number only, and you can send up to €1,000 immediately after.
You save time as it takes only a couple of minutes to send a transfer. And you save money because thanks to its in-house monitoring system, Profee offers the best currency exchange rate on the market. But the best thing is that, unlike banks, Profee has no hidden charges: you always know the exact amount your recipient gets.
As you can see, opening a European bank account, online or in person, can be quite a challenge. But if eventually you manage to find a suitable bank and convince them you are a worthy customer, the opportunities are endless!
