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Banking guide to Hong Kong

Hong Kong is one of the world’s premier banking jurisdictions, and one of my personal favourites. In this guide, I detail how to open personal and business bank accounts, how to apply for credit, how to setup payment processing accounts, how to open wallet accounts, how to transfer money in and out of Hong Kong and share personal experience and observations.

An overview

Hong Kong has one of the world’s most developed and diverse banking sectors, with hundreds of banks and financial institutions operating on a wide range of licenses. The most relevant, for this guide, are the banks, virtual banks, EMIs and brokers. The banks all operate branch networks and all offer access to a wide range of products and services. Most tend to focus on the local market, as well as corporate clients. Nevertheless, it is possible for non-residents to open accounts with some of them. The virtual banks operate on full banking licenses but are exempt from having to maintain a branch network. Their product offering is often narrower than that of the banks and their focus, as of 2022, is entirely on the local market. The EMIs operate on financial services licenses, meaning they are not real banks and as such, cannot issue Hong Kong bank account numbers. Instead, they usually partner with banks to issue those numbers. They offer a wide range of products and services, many which are complementary to the banks and virtual banks offering, and their focus is on both private and corporate clients, often globally. The brokers operate on brokerage licenses and offer access to all the instruments and services expected of such institutions. Those include stocks trading, bonds trading, currencies trading, ETFs trading, robo advisor accounts and more. Licenses have also been granted to crypto-related companies, marking a turnaround in the HKMA’s stance from its previous anti-crypto stance.

Deposits in Hong Kong are protected by the Deposit Protection Board up to 500000 HKD, assuming they are held in eligible accounts. Term deposits held at licensed banks and virtual banks are usually covered if the maturity does not exceed five years. Other investment products are not usually covered. In any cases, deposit security is not a major issue in Hong Kong as the banking sector is very stable and well capitalised.

Since 2018, the Hong Kong Monetary Authority has been rapidly implementing a number of changes to the banking sector with the aim to not only allow Hong Kong’s banking and fintech industries to catch up with other countries’ but for them to become global leaders and for the SAR to become a testing ground for China and other markets. Important changes that have already been implemented include the launch of FPS, a system that allows for instant transfers between accounts held at licensed banks and virtual banks; advanced open banking, a set of protocols that allow third parties to leverage banking data and services as part of their own offering; the launch of the virtual banking license, a license that allows new entrants to launch entirely new digital banks without the requirement to maintain branch networks; the launch of a number of changes to the insurance and investment industries, allowing for new entrants to build entirely new platforms with a strong focus on technology and AI.

Of course I could not ignore the Chinese connection, and the possible impact Beijing may have on the Hong Kong banking sector in the future. My personal opinion is that while politics may have a negative impact on the sector in the coming years, the long-term position of HK as a financial hub remains solid.

Opening an account

In most circumstances, it is not possible to remotely open a bank account in Hong Kong as a non-resident. This goes for both personal and business accounts. Even in person it can be very difficult, unless you qualify for a premium account / private banking. If you simply want a functional offshore bank account, with low fees and interesting features, I recommend looking at the US instead.

Personal accounts

Your first step will be to choose a bank. This step is important and deserves careful consideration as it will significantly influence the account opening process and the services you will have access to as an account holder. While there are LOTS of banks operating in Hong Kong, only a small fraction accept non-residents. As of 2022, these include Citibank, HSBC, Hang Seng and Standard Chartered. BEA will also work with you if you can deposit more than 500000 HKD and DBS if you can deposit more than 200000 HKD.

The banks listed above all offer similar accounts and debit cards (debit Unionpay although Citibank also offers a debit MasterCard). They all have online banking, mobile banking, they also all support FPS and all offer multi currencies accounts. Where they differ most is in their credit card offering (Citibank, BEA and Standard Chartered are the clear winners here). If you plan to apply for a card, pay especially close attention to this as you will only be able to apply with banks with whom you have bank accounts.

My personal recommendation: Standard Chartered’s Premium account. The minimum balance requirement is a reasonable 200000 HKD, their debit card has no foreign currency fees (they even reimburse you for third-party ATM fees), you earn Asia Miles for most transactions, most regular fees are waived (including the annual fee on their Asia Miles credit card) and you get access to priority customer service.

After choosing a bank, you will have to start preparing your due diligence documents. Every bank in Hong Kong will ask you for a proof of address (from a reputable bank or utility company, in your name, less than 3 months old) and a valid passport. Some will also ask for additional documents such as a recommendation letter from a reputable bank, a proof of origin for the funds you deposit etc. It is important to note that your documents will have to be in English or Chinese. If they are not, they will have to be translated by a bank-approved translator. You will also need to have some cash on you, as a deposit is often required to activate the account. In most cases, 100 HKD will be enough. I recommend calling your chosen bank before flying to Hong Kong, to confirm their up to date requirements.

You can read my guide on travel hacking for ways to save money on your trip. Plan to spend at least 2-3 full days in the city (I recommend staying for an entire week in case you are asked for more supporting documents and need to have them shipped in). I recommend starting with Hennessy Road (MTR stations Wan Chai and Causeway Bay) as almost all the major banks have branches side by side there so in the event that one refuses to open an account, you can visit the one next door and try there instead. When you arrive, simply tell the receptionist that you want to open a non-resident account and they will point you in the right direction. Although it is not necessary, having a local mobile phone number will greatly help with setting up the online banking so I recommend getting a prepaid SIM card at a 7/11 or Circle K prior to visiting the bank (CSL and CMHK are both decent). You can keep the SIM active by depositing 50 HKD or so every six months. It usually takes up to an hour to complete the process so plan your day accordingly. In almost every cases, you will receive your debit card and documentation on the spot.

Business accounts

While the requirements vary from bank to bank, they usually are the same as for personal accounts + certified copies of your company documents. Be prepared to answer questions regarding the type of business you run (or plan to run), your business experience, your clients, the source of your initial deposit, your transaction volumes, how do you process payments etc. Often, you will have to provide the bank with A LOT of supporting documents, possibly even some references.

To open a business account, you will first need to book an appointment with the bank. I recommend calling at least 2-3 weeks in advance to ensure that you get your preferred time-slot. During the call, the bank will inform you of their due diligence requirements and of the location of their commercial banking center. Simply show up with the requested due diligence documents. Depending on the bank, the account may be opened on the spot or in the following days (or weeks). A debit card will usually be issued and in some cases, a two-factor authentication device. Please note that most Hong Kong banks charge a company search fee when opening a business account. The fee for HK-registered companies is trivial, usually no more than 500 HKD. For overseas-registered companies, however, it can be as high as 20000 HKD (and will be due regardless of whether they approve or decline your application). Speaking of which, it is possible to open a HK business bank account for a foreign registered company but it certainly is not easy. In most cases, you will be asked for a reason for opening the account (that you want a HK business bank account is not a valid reason, you need a reason why you NEED the account).

If you have a HK company but cannot open a HK business bank account, using an EMI may be an alternative. Neat, AirWallex and Currenxie are the most popular options.

Premium banking

The major banks all offer premium banking accounts and opening such accounts is much easier than opening “normal” personal bank accounts. You will need the documents listed in the personal accounts section as well as a proof of origin for the funds you will initially deposit. As a premium account holder, you will benefit from lower transaction fees, better customer service and a waiver on annual fees and income requirements for most credit cards. Obviously, you will need to maintain a much higher relationship balance to qualify and keep the account active (ranging from 500000 to 8000000).

Virtual banks

The HK Monetary Authority started issuing virtual banking licenses in 2019. The virtual banking licenses are very similar to the existing banking license, with an important distinction. There is no requirement for the licenses to maintain branch networks (they are required to maintain at least one in-person customer service centre). This means that HK virtual bank accounts are full banking accounts, not EMI accounts, and that virtual banks are allowed to offer the same range of products as brick and mortar banks. Do note that some virtual banks have started offering business bank accounts, very useful if you have a HK company and a HKID.

As of 2022, none of the virtual banks accept non-residents (except if they hold a permanent HKID). My favourite virtual bank is ZA, thanks to their excellent app and wide range of services. Mox and WeLab are also excellent. In every cases, opening an account is near-instant and is done entirely remotely.

EMIs

EMIs are financial services companies that offer accounts that mimic bank accounts, but are not. They are not allowed to hold deposits directly so instead they use segregated accounts at underlying banks. This means that deposits are not protected by the government.

They also typically issue prepaid cards instead of debit cards. These cards function in a similar way but are not as widely accepted.

In Hong Kong, the most popular EMI is HKT Tap & Go. They offer a MasterCard that can be used worldwide (including online) and the ability to receive / send (via FPS) and hold money. The card can also be used via Apple Pay, Google Pay etc.

Long term considerations

Once your accounts are open, you should register for online banking using the information the bank provided to you. I recommend doing this while in Hong Kong so that you can visit the bank again if there is any problem. Once registered, make sure that your account information is accurate and that you are signed up for two factor authentication with at least one backup method (for example, mobile number + authentication app). 

If you intend to pay local bills using your new accounts (credit card bills, for example), head over to a Circle K convenience store and ask for the PPS machine. Register using your ATM card and local phone number. Once registered, visit the PPS website and log in. Change your username and password to something more convenient. You can then add payees, pay your bills etc. It is much more convenient to use PPS than the online banking facility of your bank.

Local address

While the residential address on your accounts should be your real address, it is usually possible to add a different correspondence address. Using a Hong Kong address as your correspondence address can greatly help with the long-term maintenance of your account. The most cost-efficient way of getting a Hong Kong address is via a mail forwarding service provider. You can find more details here along with a list of my favourite service providers.

Applying for credit

A number of credit opportunities are available in Hong Kong. To access this content, please log into your Insiders Club account. If you do not have an account, click here to learn about the benefits of membership.

Payment processing

Stripe, PayPal and Braintree are available in Hong Kong, for locally-registered companies. Their processing rates and fees are higher than they are in the US and Europe, however, so it makes sense to consider using a payment processing subsidiary instead (not to mention currencies support).

If you have a Hong Kong business, you have access to a large number of payment processing services. I maintain a list of such services and provide service specific guides, you can access it here.

Moving money

I have written a comprehensive guide on how to transfer money internationally. You can read it here.

Wise and AirWallex are both available in Hong Kong and are excellent options for international money transfers. For local money transfers, FPS is the best option. Do make sure to register your email address and phone number for FPS before sending / receiving transfers.

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