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Banking for Expats in Brazil

Submitted: May 2014

Brazil is a high-tax developing country. Its financial system is tightly regulated, even though the exchange rate regime follows a free float. Consequently, opening an account is not necessarily that easy.

Opening an account is something that expats should plan for several weeks in advance. Bank accounts may be opened by both residents and non-residents, but banks are generally quite reluctant to open a current account for a non-resident. For US citizens, the FATCA adds fuel to the fire as it makes it more costly for non-US banks to accept US clients.

Foreign currency accounts

Foreign currency accounts are generally not available from Brazilian banks. However, the foreign exchange regulations may provide for some concessions for expats who are staying in Brazil temporarily.

Opening an account

Bank accounts must be opened in person at a bank branch, although the account opening process may be initiated online.

As far as paperwork is concerned, you need at least:

  • Proof of ID – if you are a resident foreign national, you will need a foreigner’s ID card (Cédula de Identidade para Estrangeiro)
  • Permanent visa
  • Brazilian tax identification number (a “CIC” or “CPF” number)
  • Proof of address

Other documents may be required, but this varies from one bank to another. This could be, for example:

  • Payslips
  • Employer reference letter
  • Bank reference letter
  • Credit card checks
  • Your last tax return
  • Proof of income

Non-resident accounts

Things can be much trickier for non-residents, even though the law does not expressly bar them from having bank accounts in Brazil. Opening an account in Brazil as a non-resident is likely to involve higher costs, if you can ever open any.

Typically, you will need to show a Brazilian address as well as a CPF number. This is often achieved by having some family in Brazil.

Being a high net worth individual will surely help as well. In such cases, you should consider going to a Brazilian private bank. See Wealth Management for Expats in Brazil.

Products available

Brazilian bank accounts are generally fee-paying, and the fee is meant to cover a basic banking package. However, your bank is likely to provide for a scheme that may cover these charges. Typically, holding a minimum balance with your bank would help you towards that fee waiver.

As far as Brazilian savings accounts (Poupança) are concerned, their interest rates have always been quite high. Currently, you could expect to get 6% on an easy-access savings account, tax-free. This tax exemption, in substance, is just a way to ensure your savings are not going to erode because of inflation.

Where to apply?

The banking system in Brazil is a concentrated one, a bit like the UK’s. Anyway, it is strongly advisable to shop around before selecting a bank. Feel free to compare the fees, the interest rates, the customer satisfaction rates, and the account opening process.

Brazil’s main banks are Banco Itaú, Santander, Banco do Brasil, Caixa and Bradesco. All banks are regulated by the Central Bank of Brazil (Banco central do Brasil).

Banks are typically open from Monday to Friday, from 10am to 4pm.

Day-to-day account management

Do always check if you are paying a fee for something you don’t need, for banks make a lot of money from the charges. Most importantly, you should check what is included in the basic monthly fee.

Once opened, your account will come along with a cheque book and a debit card. Cheques may be dispensed from an automated machine at your bank’s branches.

Both cheques and debit cards are widely used for payments in Brazil. Debit cards may also be used for your day-to-day account management (e.g. deposits, bill payments) through ATMs in Brazil.

Additionally, the following services are generally available from Brazilian banks:

  • Online banking and statements
  • Direct debits

 

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