Setting up a Cayman Islands company is a simple process and many foreign investors choose to set up a company here. Opening a business bank account is a subsequent step after the formation of the legal entity and individuals and entrepreneurs can choose between the various bank branches that offer their services.
Are you interested in starting a business and opening a corresponding bank account in 2024? Our team will help you throughout the process and will act on your behalf in front of the bank if needed.
| Quick Facts | |
|---|---|
| Mandatory local bank account for companies | No |
| Mandatory residence requirement | No |
| Bank account opening time | 1 week (The time can vary when you open a bank account in Cayman Islands for companies) |
| Online bank account opening | Possible with some banks |
| Bank accounts for foreign nationals in the Cayman Islands | Yes |
| Required documents for companies | In most cases the documents to open a bank account in Cayman Islands are: – filled-in application form, – identification documents for the shareholders/directors/administrator, – company good standing certificate, – company incorporation documents |
| Required documents for individuals | – filled-in application form, – identification document, – employment letter, – proof of address – other documents for showing the right to reside in the Cayman Islands |
| Special requirements for foreign nationals | US citizens can be required to present a special form as per the FATCA requirements. |
| Bank fees | Bank fees in the Cayman Islands vary. Examples include: – monthly maintenance $10.00 (not applicable for average balances), – premium account annual fee $1,000, – online transactions $0.25 (per item) |
| Initial deposit | Banks can impose a minimum average balance, for example $100,000, to be considered by those who open a bank account in Cayman Islands. The minimum average balance for personal banking can be $10,000. |
| Types of accounts | – chequing account, – savings account, – student account, – business account etc. |
| Online banking | Yes, features depending on the chosen bank in the Cayman Islands |
| Local agent requirements | Not mandatory. We advise having a local agent, such as from our team. |
| Main banks in the Cayman Islands | – Cayman National, – Trident Trust, – Cainvest Bank, – Fidelity Bank etc. |
| Criteria for choosing the bank | – online banking options, – account services fees, – number of ATMs, – special features or solutions, – available currencies for opening an account and others |
In order to open a bank account in the Cayman Islands for a legal entity, registered either in the Islands or in another location, the applicant will need to provide relevant documentation.
The Cayman Islands offer not only different business advantages, most notably the lack of tax for locally registered companies, but also a high level of banking safety and professional services. The concept of banking secrecy is not necessarily the one understood by many who refer to the Cayman Islands as a tax haven. The Islands have signed a number of bilateral agreements for the automatic exchange of financial information and this is relevant to citizens for signatory states who open a non-resident bank account. The reporting obligations do not apply in case of countries that have not signed this type of bilateral agreement.
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The steps briefly described below apply to most business owners who open a bank account in the Cayman Islands:
When the business of the company takes place in the Cayman Islands, a copy of the Trade and Business License will be required. A certificate of good standing will also be required for companies that are older than one year. The bank may require that the company documents are certified by a notary public.
Bank accounts can be opened by e-mail in most cases. The company directors can be involved in the process, however, one of our agents who specialize in Cayman Islands incorporation can handle this step as part of opening a company. Non-residents who wish to open a bank account in Cayman Islands for personal purposes apart from the one used for their registered business in the Islands can talk about this matter with one of our banking specialists.
Bank account opening is an essential step for the set up of a Cayman Islands company. If you require specialized assistance or pre-incorporation counsel, our company formation agents can answer any questions. Banking matters have significant importance and implications, however, foreign investors interested in offshore company formation can also find out other important details from our experts.
Bank commissions in the Cayman Islands will include those related to the maintenance of the account, fees for wire transfers, those for issuing a debit or credit card and different other fees. The account can be opened in any international currency. A minimum deposit can be required.
For the purpose of transparency, the Cayman Islands Monetary Authority provides a summary list of the common fees. The one available on 1 November includes the following fees for retail banking:
Other operations that are subject to charges include large cash handling, with more than one bank charging 1% of the amount over 5,000 USD, foreign exchange, local or international drafts, incoming and outgoing wire transfers, electronic funds transfers, overdrafts or bill payments.
Please keep in mind that the fees are issued for informative purposes and they are general ones. In practice, banks may change them as they see fit and those who open a bank account in Cayman Islands should check their availability before making a choice that is also based on these fees. ATM card issuance is usually free of charge, however, the subsequent issuance of a card is taxed. ATM withdrawals are also subject to a fee and this is larger if the withdrawal is made at another bank locally or at an international bank.
We invite you to watch a short video on how to open a bank account in the Cayman Islands:
All banks charge monthly maintenance or service fees. As per the data gathered by the Cayman Islands Monetary Authority, in November 2020 the following examples applied for these services:
Banks reserve the right to calculate the maintenance or service fees for the personal and business accounts (savings or chequing) as per their own policies. For example, the Butterfield Bank Limited charges the corporate chequing account maintenance at a rate of 6CI$ per account if it falls under the required daily balance average of 5,000 $.
The Cayman Islands offer significant advantages in terms of company formation and taxation. The Cayman Islands exempted company is the preferred business form and the one that has the most notable advantages for foreign investors.
Some of the advantages of opening a bank account in the Cayman Islands include the following:
The Cayman Islands is part of the Foreign Account Tax Compliance Act of the United States (which reports the activity to the Internal Revenue Service) and also a signatory in a number of bilateral treaties for the exchange of financial information. This means that although the country does retain important tax advantages, however, individuals who open bank accounts are to be regulated as per the treaties in force.
The Cayman Islands is part of the Foreign Account Tax Compliance Act of the United States (which reports the activity to the Internal Revenue Service) and also a signatory in a number of bilateral treaties for the exchange of financial information. This means that although the country does retain important tax advantages, however, individuals who open bank accounts are to be regulated as per the treaties in force.
The FATCA Guidance Notes are useful for understanding the provisions that apply in terms of reporting. As far as compliance with the United States Regulations are concerned, failure to do so by Cayman financial institution may result in a 30% withholding tax imposed on the US source of income of the said non-compliant institution. As highlighted below by our agents, the majority of the banks in the Cayman Islands are Category B, meaning that they provide services only to clients outside of the Islands (which in many cases may very well be US nationals – making it relevant for the bank or the financial institution to comply with the rules in force).
All Cayman Islands Reporting Financial Institutions and Registered Deemed Compliant Financial Institutions under the US Agreement are required to register with the IRS and obtain the Global Intermediary Identification Number (GIIN). Such registered and compliant financial institutions appear on the monthly IRS FII (foreign financial institutions) list.
The Guidance Notes on the International Tax Compliance Requirements contain different provisions for reporting in case of the United States of America and for the United Kingdom in terms of reporting and non-reporting financial institutions. Investors from the UK and the USA can take note of these differences before they open a bank account in Cayman Islands.
Bank account creation in the Cayman Islands in 2024 observes the rules for anti-money laundering and criminal activities. However, the Cayman Islands remains one of the locations with a solid respect for banking privacy and foreign nationals are able to open an account quickly and in some cases while still being offshore (provided that they send the needed documents and use local services, such as those offered by our agents).
According to the Cayman Islands Monetary Authority, the number of international banks remained largely the same in 2023 as in 2022, with certain fluctuations or minor reductions in the total number of banks per a given region. Our team also presents the data available for the third and fourth quarter of 2023:
One of our specialists in Cayman Islands incorporation can give investors more details on the process of opening a business bank account in 2024 and the requirements for locally registered and non-resident companies.