What are the benefits of having your business bank account in a Dubai bank?
A business bank account is needed to transfer funds, manage business cash flow, and control investments for any company established and active in Dubai.
The main functions of a business bank account in Dubai are:
- Cash flow management
- Credit
- Investment of assets
- Currency conversion
Cash flow management accepts deposits from third parties (customers, investors etc) on behalf of the company. Usually, this is done by bank-to-bank wire transfer from the paying bank. Another part of cash flow management by banks is in handling discounting of bills and to allow the company to make direct payments to employees for salaries, to suppliers for goods and services delivered to the company, and to meet regular business expenses through direct debit and credit card charges etc. Banks in Dubai also allow customers to pay suppliers by corporate cheques and drafts.
Bank credit is an essential feature that any venture must be able to obtain, since running a business completely on shareholder capital is becoming increasingly difficult. A good banking relationship will be required so that the bank is able to advance funds to your company in the form of fixed loans, lines of credit, overdrafts etc. Bank credit can be in the form of a deposit into the company’s current account, where it can be used in the same way as the ordinary cash balance, or it can be in the form of an overdraft facility, where the company’s account can go into minus.
Investment facilities provided by banks in Dubai cover normal cash management such as short-term deposits of surplus cash, medium-term investment in bank deposit accounts, and also equity investment in the local or international digital currency, bullion or stock markets.
Currency conversion is an essential function in the operation of free zone companies in Dubai. By definition, free zone corporations can only do business with customers outside of the mainland UAE market. In such cases, most transactions will involve currencies other than Dubai dirham, such as dollars, euros, pounds and yen.
How to open a company bank account in Dubai
The criteria for opening a business bank account in Dubai differ between free zones and the mainland, and also between bank to bank. It’s important that you review and become familiar with these stipulations before submitting an application.
How to open a corporate business bank account in Dubai
Once you have satisfied the above requirements, you can apply to your chosen bank to open a business account. Different rules for local presence apply. Mainland and offshore companies must have a registered office inside the country, but some free zones allow companies to either operate totally online from remote offices, or to rent virtual space “on the cloud” in a free zone. A mainland company requesting to open a commercial bank account in Dubai is required to be physically located in the country.
How to open a business bank account in Dubai for non residents
Some banks allow fully digital online processing of new account applications. This involves filling out the required application form and submitting copies of all of the necessary documents via the internet, and conducting any follow-up interviews etc in digital meetings.
What are the requirements for opening a business bank account in a Dubai free zone?
Below is a basic list of the documents banks will require from you before they will consider an application to open an account. This is a general list, and each bank sets its own rules, which can also change depending on your type of business, whether you are applying for credit or special features, your own banking history and many more details. It’s important to get all of this in order before approaching the bank, so you should let us do the necessary work and save yourself time and the risk of a negative reaction.
For a mainland company:
- Trade license
- Memorandum of Agreement and/or Articles of Association
- Certified copies of the passports and visas of all executives, partners and shareholders, with passport photographs
- Certified copy of the corporate share certificate
- Any real estate tenancy agreement along with the Ejari contract
- Historical bank statement for the past six months for executives, partners and shareholders of a new company, or of the holding company if this is a subsidiary of either a UAE or foreign company
- Utility bills as proof of address
- VAT certificate
- For new companies – a business model or business plan, financial projections, company profile
- CVs of all corporate signatories
- List of existing or prospective customer and suppliers, or government tenders
- Certified examples of the company’s invoices and receipts
How to open an offshore bank account in a Dubai free zone?
- Certified copy of the company’s UAE Trade licence
- Certified copy of the Memorandum of Agreement and/or Articles of Association of the subsidiary
- Certified copies of the passports and visas of all executives, partners and shareholders, with passport photographs
- Any real estate tenancy agreement along with the Ejari contract
- Historical bank statement for the past six months of the holding company
- Utility bills as proof of address
- VAT certificate
- Certificate of good standing of the parent entity
- Details of the parent entity’s foreign banks
- CVs of all corporate signatories
- List of existing or prospective customer and suppliers
- Certified examples of the company’s invoices and receipts
In most cases, these documents are mandatory.
How long does it take to open a business bank account in Dubai?
Before a bank will consider your application, you should have your company licence and UAE residency visa already on hand. Most banks will not process an application before these are available to view.
Usually, banks will immediately open an account in your company’s name, but only so that you can deposit any stipulated minimum balance which guarantees the payment of all banking fees in case of rejection. No transactional business can be conducted until the account is formally opened. Depending on the specific details of your company and the kind of account you are applying for, the application may take anywhere from two weeks to several months. The bank will keep the account frozen with that minimum amount in the meantime.
