Bank account opening process in the UAE has its pitfalls of which you might not be aware of if you do not deal with it on a daily basis.
As a result of international initiatives of AML/CFT activities the account opening process has become more complicated and financial institutions are more rigorous in their due diligence process with different Enhanced Due Diligence processes such as Know Your Customer and Know Your Customers Customer as well as Know Your Supplier and Supplier’s Supplier etc.
Regulation is coming from the Central Bank that is applying international AML/CFT/Risk standards to the local market. Considered a High-Risk zone because of its transit nature and geographical location UAE has tightened the screws, which in itself is a great thing. More transparency and more knowledge of the customer should lead to a better overall relationship. Unfortunately, it’s rarely the case as some of you may know. Often if the relationship manager who holds your account isn’t deeply invested in the relationship, you will find yourself answering the same questions repeatedly, getting service issues as well as wires held up and overall difficulties of opening and managing accounts.
Some of the contradictory and sometimes paradoxal examples of bank policies:
- Location/Place of registration: Some banks will refuse specific freezones although they are in the UAE. Mainly the Northern Emirates are more complex then Dubai or RAK freezones for example.
- Business activities: Certain business activities such as general trading are prohibited to onboard in banks. Other business licenses have requirements such as physical office etc and these change from bank to bank.
- UAE residency: To increase the likelihood of getting a bank account having a UAE residency is a big added value. Some banks will not consider opening bank accounts for non resident individuals without a certain investment or insurance that creates income for the bank and lets them justify the relationship with their management.
- Office requirements: In our day to day experience the physical office requirement is becoming a gold standard with local banks. If you do not have a local business premise and not a virtual desk your account will not be opened.
- Business plan: Without an appropriate business plan drafted in the right way and in the correct manner that the compliance department can understand the onboarding team will reject your file.
- Website: website is now also a must, if you have a startup or a trading company imports exports goods between your private clients you still need to have a website or the banks will consider you a non-existent business.
There are many more red-flags that pop up during the onboarding process and that can be prevented with good planning, professional advice and local knowledge. Our team has been working in this market for more than 5 years and has dealt with private, corporate and private banking cases in local and international banks. We have the knowledge and know-how to assist you.
Send us an inquiry at email@example.com and one of our team members will get in touch with you within 24 hours.