4 Steps and 6 Powerful Tips to Overcome Challenges to Open Business Bank Account in Vietnam

When a company decides to invest in Vietnam, one of the first steps is to open business bank account in Vietnam to facilitate the receipt of investment funds. To open business bank account in Vietnam is crucial for paying for services and managing the business operations within the country.

Vietnam as Attractive Destination For Investment

Vietnam’s economy has been steadily growing despite global geopolitical tensions. Every day, it seems like the news brings more concerning developments from around the world, with tensions rising over the last few years for various reasons, particularly post-COVID.

Many companies are finding that they need to downsize in some affected markets. As a result, it’s essential to focus on markets that offer stability and potential for future growth. Vietnam, along with other Southeast Asian countries, has emerged as an ideal investment destination due to its stable political and economic environment.

In this article, we will explore the requirements to open business bank account in Vietnam, how to choose the right bank, the necessary documentation, the step-by-step process, common challenges, and how to overcome them. We will also discuss the costs and the range of banking services available in Vietnam.

Legal Requirements and Regulations

When a foreign company is established in Vietnam, it is legally permitted to open a business bank account in Vietnam. The first step is to open a Direct Investment Capital Account (DICA), which allows the company to transfer funds into its operational account in popular currencies such as USD, EUR, and VND.

One common concern is whether companies from certain countries are allowed to open business bank account in Vietnam. The answer is yes, as long as the company is set up with an investment certificate and an enterprise registration certificate in Vietnam, they are eligible to open business bank account in Vietnam.

Banking services in Vietnam vary from bank to bank. Typically, clients must comply with specific rules, such as filling out forms and signing declarations to ensure compliance with anti-money laundering laws and other regulations.

How to Choose the Right Bank

Choosing the right bank to open business bank account in Vietnam involves considering several factors. These include the type of documentation required by each bank, whether the bank is locally owned or foreign-owned, and the range of banking services offered. The banking fees, reputation, and ease of transactions can also vary. Each bank’s advantages or disadvantages will depend on the specific needs of the client.

For instance, some companies may require a simple bank account to receive funds and pay for local services, while others may need a bank that can quickly transfer money abroad in foreign currency. Additionally, some businesses might seek credit services with less complicated procedures.

Step-by-Step Process to Open Business Bank Account in Vietnam

1. Prepare Required Documents: Start by gathering all necessary documents based on the bank’s requirements. Foreign and local banks in Vietnam may have different requirements, with foreign banks often focusing more strictly on anti-money laundering compliance and client verification processes, commonly known as KYC (Know Your Customer).
2. Submit Applications: After ensuring all documents are in order and properly signed by authorized personnel, such as the director and chief accountant, submit the application to the chosen bank.
3. Verification Process: The bank will carry out a verification process to ensure all information is accurate and complies with regulations.
4. Activate Bank Accounts: If everything is in order, the bank account will be activated, and the initial deposit requirement will need to be met.

How Long Does It Take to Open Business Bank Account in Vietnam?

The time required to open business bank account in Vietnam can range from one day to two weeks or more, depending on the complexity of the KYC process and the completeness of the documents submitted by the company. In some cases, bank accounts can be opened within one day if all guidelines are followed correctly.

Challenges in Opening Business Bank Account in Vietnam

Opening a bank account in Vietnam can present several challenges. Language barriers can be an issue when dealing with local banks, which may be a disadvantage for foreign companies. While foreign banks may offer more convenience in this regard, their KYC processes can be more stringent and time-consuming.

Another challenge is the bank’s motivation to open a new account. Some banks may prioritize offering loan services or encouraging clients to deposit funds on a term basis rather than focusing on opening new accounts. Therefore, it’s important to align the bank’s services with the client’s needs to ensure a good match.

Costs Associated with Opening Business Bank Account in Vietnam

The cost to open business bank account in Vietnam is generally minimal. Most banks do not charge a fee to open an account, although they may charge for other services, such as transfer services or providing credit. Additionally, there may be fees for maintaining balances below a minimum amount or for services like internet banking or financing.

About ANT Lawyers, a Law Firm in Vietnam

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers has lawyers in Ho Chi Minh city, Hanoi,  and Danang, and will help customers in doing business in Vietnam.