Singapore is known globally for being one of the most business-friendly destinations. The ease of incorporating a business and opening a business account implies that Lion City is conducive to success for all businesses stepping into its realm.
For businesses committed to being profitable, opening an office in Singapore can be one of the most strategic decisions. There are three main types of offices that a foreign business can establish in Singapore:
- Subsidiary Company: Foreign companies can register themselves as subsidiaries to gain the same advantages as a Singapore-incorporated company. A subsidiary can have its own name and business structure. A business owner would be required to appoint a Singaporean citizen, a PR, or an EP holder as the local director and get a registered local office space.
- Branch Office: A branch office is an alternative to a subsidiary company. The downside is that the branch office would be ineligible for local business incentives provided by the Singaporean government. Additionally, a branch office would be required to maintain the same business name and model as the parent company. However, rather than appointing a local director, a branch office would be required to appoint two local agents.
- Representative Office: Foreign enterprises seeking to investigate commercial prospects in Singapore might establish a representative office before undertaking a permanent local establishment. Registered offices have no legal status; they can’t partake in revenue-generating trade. In essence, a representative office is a temporary arrangement for prospective businesses.
To successfully operate your business in Singapore, a business owner would be required to open a business account.
Steps to open a business account in Singapore.
- Choosing a bank: Different banks offer different financial services and account options. Thus, it’s up to the owner’s discretion to determine whether a specific account type or bank would be the right choice for sustaining the business. Below are a few things that a business owner must consider before choosing a bank:
- Fees related to account opening, including minimum balance and maintenance fees. The minimum balance usually ranges from 500 to 3000 SGD.
- Multicurrency support should be provided so that the international business can save optimally on currency conversions.
- Business owners should check if they’d be required to be physically present at the bank for account opening.
- Online account management is integral as it saves account holders from having to visit the bank for minor financial transactions physically.
- The ability to integrate the business account with different business tools is also something that a business owner should look for.
- Lastly, the reputation of the bank should be checked before opening an account.
- Form-filling and submission of the documents: After a business owner has chosen the bank and the account type, they would be required to fill out the respective bank’s account opening form and complete the KYC process. A business owner would be required to submit the following documents to the bank.
- Proof of registration.
- Identification and residential proof of directors, shareholders, and ultimate beneficiaries.
- AoA and MoA.
- Resolution to commence business transactions, signed by the company secretary.
- Copy of the company constitution.
- Business profile, plan, and other documents required by the bank.
- The company secretary should sign each copy. Additionally, it’s also good to carry the original copies in case the bank demands to see them.
- Review and authentication: The bank checks all the documents and permits to authenticate the commencement of a business account. The bank would notify the applicant if they require more documents. It usually takes about 3–4 weeks for the application to be processed. Business owners should be wary of any entity that claims to get the process done in a shorter duration. Some banks may also insist on conducting in-person interviews.
To conclude, it’s integral for all business owners to carefully select the account type and bank where they want to open a business account. Opening a business account can be a straightforward process for foreign businesses if they have all the necessary documents ready with them. Nonetheless, foreign business owners should be aware that they’ll have to go past stricter compliance checks and KYC processes. Moreover, a business owner should also be aware that opening a business account as a foreign business can take up considerable time.