Why Open a Bank Account in Georgia?
Georgia is widely acknowledged as a premier jurisdiction for opening a bank account, particularly for non-residents. The stability and effective management of Georgian banks contribute to this reputation. Furthermore, the Georgian economy strengthens yearly, making it an attractive option. Despite regional challenges, Georgia stands out as one of the most accessible European banking jurisdictions for non-Europeans. It surpasses countries like the UK, Australia, Canada, Germany, and the UAE, ranking #7 worldwide for “ease of doing business,” according to the World Bank’s 2020 report. In recent years, the government implemented favorable tax rates, investment incentives in Georgia, and an easy visa program to attract foreigners interested in opening a bank account in Georgia. Other benefits of opening a bank account in this country include:
- Secure your privacy: As a non-CRS country, opening a bank account in Georgia ensures that your banking information is not automatically shared with your home country. Note that Georgia plans to join CRS in 2024.
- No deposit requirement: Enjoy the convenience of opening a bank account in Georgia without needing an initial deposit. Consider depositing enough money for premium service to be assigned a private banker.
- Minimal service fees: Georgian banks offer attractive benefits with minimal service fees compared to Western counterparts.
- No capital controls: Experience the freedom of sending money anywhere from Georgia except to countries on the sanctioned list.
- Convenient banking options: Georgian banks provide efficient in-person and online banking services, including mobile banking for international transactions. The AML department may require additional documents.
- High-interest rates: Benefit from high-interest rates of 11.5% on deposits in Georgian Lari (GEL), a stable currency with daily growth.
- Competitive deposit rates: Enjoy higher deposit rates in USD and EURO than those offered in the US and Western European countries.
Efficient fund transfers: Bank accounts in Georgia follow the international IBAN format, making fund transfers convenient and eliminating the need to deal with SWIFT/BIC codes. Transferred funds are received promptly, ensuring fast and efficient transactions.
Georgian Bank Account Application Process and Restrictions
The process of opening a bank account in Georgia and the success rate vary based on residency, citizenship, account type (personal or corporate), and the application method. Recent global events have led to some changes and stricter procedures. It’s important to note that in certain countries, citizens have a 20% chance of opening a Georgian bank account, per internal bank regulations. While these lists are generally similar across banks, there may be variations. Citizens from Iran, Syria, Libya, Sudan, Cuba, North Korea, South Africa, Ghana, Nigeria, Pakistan, Afghanistan, South Sudan, and Somalia are restricted from opening private accounts at TBC and Banks of Georgia. This list is subject to change, with countries potentially being added or removed.
How to Open a Corporate Bank Account in Georgia? (Business Account)
To begin with, to open a business account in Georgia, it is necessary to establish a company registered in Georgia. More information regarding this can be found in the section on business formation in Georgia. In simpler terms, if a company operates physically in Georgia, accepts or makes card payments, and has employees, it must open a corporate bank account in Georgia. Additionally, companies registered for VAT in Georgia must have a physical corporate bank account. This account is essential for filing tax returns and fulfilling business tax obligations to the Georgian Revenue Service.
Advantages
Having a corporate bank account in Georgia offers advantages such as the following:
- Access to a multi-currency account supporting various currencies, including USD and EUR
- The inclusion of company debit cards from TBC or Bank of Georgia
- The possibility of opening an account remotely using a power of attorney
- Advanced Internet banking facilities
- The opportunity to receive special rates for currency exchange through online banking.
Procedure
Opening a Georgian bank account for companies involves a few key steps:
- Ensuring bank compliance: Establishing economic substance in Georgia is essential to meet Georgian bank requirements. This facilitates the account opening process and ensures its long-term viability.
- Streamlined opening process: If you visit Georgia in person, simply bring your company documents and passport to the bank for a straightforward process. Within two days, you can access internet banking, a DigiPass for transaction authorization, and company debit cards. Alternatively, you can open a bank account in Georgia remotely by providing a power of attorney.
- Effective bank communication: Building a solid relationship with the bank is crucial once your account is active. Promptly and honestly responding to any transaction-related queries is essential. Be prepared for occasional requests for supporting documents. While opening an account is relatively easy, maintaining it requires proper communication.
Needed Documents
To open a bank account in Georgia in 2023, you will typically need the following documents for most company types:
- Bank’s account opening application form
- Proof of registration with the Public Registry
- Sample signatures of all authorized persons and copies of their ID cards
- Note from shareholders owning more than 25% and copies of their ID documents
How to Open an Individual Bank Account in Georgia? (Private Account)
Opening a bank account in Georgia has become more complex for non-residents due to the implementation of AML/CTF rules by local financial institutions. In 2023, customers need to undergo KYC procedures and provide details about the purpose of account opening, sources of funds, and tax compliance. Compared to previous years, non-residents can no longer open an account with just a foreign passport.
Advantages
Opening a personal bank account in Georgia in 2023 offers numerous advantages for foreigners:
- Accelerated settlements and reduced commissions for transactions with Georgian partners
- Lower financial service costs compared to the EU and many CIS countries
- High-quality service at an affordable price, with accessible premium packages
- Remote access to accounts through online banking systems
- Multilingual staff to overcome language barriers
- No specific minimum balance requirement for personal accounts
- Increased confidentiality as Georgia is not yet a full participant in the CRS system
Procedure
To open a personal bank account in Georgia, visit any bank branch, bring your passport, and answer their questions for initial processing. If approved, your request moves to the next phase. While some banks reject applications automatically, around 10% conduct company checks and notify applicants of the decision within 2 or 3 working days. Building connections in Georgia increases your chances of gaining banks’ trust and successfully opening and managing an account.
Needed Documents
To open a personal account in Georgia, you may be required to provide essential documents such as:
- Your passport
- a Georgian contact/phone number
- A filled-out application form (KYC Form)
- Proof of your source of funds
- US or UK passport holders might need to submit additional documents, like a W8/W9 form, to ensure compliance with IRS and FATCA regulations.
How to Open A Georgian Bank Account Remotely?
Opening a Georgia bank account is convenient because you can do it remotely without being physically present in the country. This option is especially beneficial for Non-residents, as direct identification is typically required. You can use a power of attorney from a local notary office and a notarized passport. This opportunity is available to residents of all countries except those under sanction. Whether you want to open a personal or corporate bank account, Georgia offers this flexibility.
Bank Account Application Rejection Reasons in Georgia
When opening a bank account in Georgia, it is essential to be aware of certain factors to reduce the risk of rejection. These include:
- Source of funds: Providing satisfactory documentation to prove the legality and origin of your wealth is crucial to avoid rejection.
- Source of payments: If a significant portion of your payments come from other countries, your account application may be more likely to be rejected.
- Foreign currency: Opening a foreign currency account is more prone to rejection than opening an account in Georgian Lari (GEL), particularly for business accounts.
- Business model: For business accounts, the nature of your business activities and organizational structure can impact the approval process. Ambiguous or questionable business practices may lead to rejection.
Georgian Bank Account Opening Fees and Timeline
When it comes to opening a bank account in Georgia, the fees and timeline can differ based on the bank and the type of account you choose. Regarding the timeline, opening a bank account typically takes around 30 minutes, ensuring a swift and efficient experience for individuals and businesses. In terms of fees, TBC Bank, for instance, charges a non-refundable fee of 500 GEL for corporate accounts, while personal accounts require only 50 GEL. On the other hand, the Bank of Georgia does not impose any fees for account opening. However, they require proof of physical or economic connections to the country for corporate accounts.
Conclusion
This comprehensive guide has provided valuable insights into creating a Georgian bank account. From understanding the necessary documentation to navigating the opening process, we explored the benefits and requirements. Just keep in mind while opening a bank account in Georgia is straightforward, it is essential to consider the bank’s domestic policies and transaction analysis, as they may lead to account closure. Choosing the correct account type and banking institution is crucial to avoid potential future costs and complications.
Bank Account In Georgia FAQ
Under thirty minutes
Bank accounts in Georgia follow the international IBAN format.
The fees for opening a bank account in Georgia vary among different banks, depending on the type of account.