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Banking for Expats in Hong Kong

Author: Gavin Adie
Submitted: July 2013

Hong Kong, as one of the world's top financial centers, lays claim to one of the highest concentrations of banking institutions in the world. Seventy of the largest hundred banks have operations in Hong Kong, and as such expatriates have a wide variety of accounts from different banks to choose from. Moreover, rules on who may set up an account in Hong Kong are significantly less restrictive than in the UK, Europe and the United States.

Bank accounts are open to all persons, whether resident or non-resident. Unlike the common scenario elsewhere, Hong Kong also offers banking services to temporary visitors requiring only proof of a home country address.

Persons seeking to establish an account prior to departing from their home country should contact the bank they desire to open an account with. You will be required to provide a home address where the bank will send correspondence, which will be used as proof of address when setting up an account in Hong Kong, in cases where you do not intend to maintain a permanent residence.

If you instead choose to set up an account in person in Hong Kong, you will be required to provide one form of identification, such as a passport or a Hong Kong Identity Card (HKID), proof of address, such as a utilities bill, and depending on the type of account you wish you establish, proof of employment, such as a contract although a pay check may suffice.

A simple cash account can be established in one to two days, while more complex accounts involving the ability to use ATMs or credit cards may involve a lengthier process.

As previously mentioned, there are several local banks and international banks operating in Hong Kong. There is a three-tier bank classification system in place, meaning that some international banks in Hong Kong will not be permitted to provide banking services, including to expatriates.

The top banks for expatriate banking services include: HSBC (The Hong Kong and Shanghai Banking Corporation), Standard Chartered, local bank Hang Seng Bank, as well as DBS Bank, Bank of China, and the Shanghai Banking Corporation.

A vast number of international banks operate in Hong Kong. Notable banks that offer expatriate banking services include: Bank of America, Deutsche Bank and Citibank.

Banks are regulated by the Hong Kong Monetary Authority, which has provided a list of all licensed institutions, here: https://www.hkma.gov.hk/media/eng/doc/key-functions/banking-stability/banking-policy-and-supervision/list_of_lb.xls

In total, more than 200 banks representing over 30 countries are present in Hong Kong.

Most banks in Hong Kong are open six days a week, from 9am to 4.30pm on weekdays, except on Friday when banks generally close at 5pm. Many banks open for a limited period on Saturdays, generally until 12.30pm.

Expatriates who do not speak Mandarin are advised to go to branches located in the center of Hong Kong, or locations where expatriates frequent, such as Tsim Sha Tsui, Causeway Bay or Wan Chai, where English-speaking bank staff are more prevalent.

Although the process of establishing an account in Hong Kong is relatively less onerous than elsewhere, Hong Kong banks often require that depositors maintain a minimum deposit balance, and some may require that you transfer your income stream to your account.

Special care should be taken with respect to rules on maintaining an account in Hong Kong. If you choose to retain your account in Hong Kong and discontinue paying in income, you should be wary of fees that may apply. The majority of banks levy semi-annual fees, for instance, where a depositor's dormant account balance falls below a pre-agreed level.

ATM transactions are generally free, but fees may apply if you withdraw cash from an ATM operated by another banking group.

Fees may apply to outbound transfers, standing orders, and some banks may charge you a fee if you close your account before a certain period of time. Some banks offer credit cards with a fee-free grace period, where fees will apply only after the first couple of years. Many retailers accept debit and credit cards for payment, and unlike elsewhere, checks are still commonly used in Hong Kong.

Local bank accounts are usually denominated in the Hong Kong Dollar, which is pegged to the US dollar at a rate of 7.8:1. Interest earned from bank deposits is not subject to withholding tax in Hong Kong, although interest earned on basic accounts in Hong Kong generally yield interest rates below one percent.



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