Managing finances and establishing a bank account is a crucial aspect of running a business, even if you don't reside in the country where your business operates. For entrepreneurs with Canadian businesses who are not based in Canada, there are several options available to open a business bank account. In this blog post, we will explore three methods to obtain a business bank account for your Canadian business when you don't live in Canada. Additionally, we will discuss the benefits and drawbacks of each approach, along with a recommendation for expert assistance from Ribbon.
Use a Non-Bank Digital Account
One of the most convenient and accessible ways to open a business bank account for your Canadian business is through online banking platforms like Wise or Airwallex. These platforms offer easy setup processes that can be completed remotely. They are particularly suitable for businesses that generate revenue from online services such as Shopify, Klarna, Afterpay, eBay, PayPal, and more. While these accounts do not provide chequing services and may not offer credit card options, they are a viable solution for managing finances digitally.
Benefits
- Quick and straightforward setup process.
- Can be established fully remote.
- Ideal for businesses relying on online revenue streams.
Drawbacks
- Lack of chequing account services, limiting compatibility with certain financial services.
- Credit card options may not be available.
- Accounts typically lack insurance coverage provided by Canadian banks.
Work with Banks with Branches in Your Home Country and Canada
Another option for obtaining a business bank account for your Canadian business is to partner with banks that have branches in both your home country and Canada. This approach allows you to open a fully functional Canadian bank account remotely, leveraging the established presence of the bank in your home country.
Benefits
- Quick and straightforward setup process.
- Remote account setup is possible.
- Enables seamless international banking operations.
Drawbacks
- Banks may require your business to reach a certain size or meet specific criteria.
- Some banks might have limitations or strict requirements for remote account setup.
Fly to Canada and Open a Bank Account in Person
The traditional method for non-resident individuals to open a Canadian business bank account involves traveling to Canada and personally visiting a bank branch. Although this option requires more effort and resources, it provides access to the full suite of services offered by Canadian banks, including credit products like credit cards.
Benefits
- Complete access to Canadian banking services, including credit products.
- Ability to establish a comprehensive Canadian bank account.
Drawbacks
- Requires physical travel to Canada.
- All shareholders and directors may need to be present to open the account.
Conclusion
Establishing a business bank account is a critical step in managing your Canadian business's financial affairs, and choosing the right method will ensure smooth financial operations and growth. To help you think through the options, Ribbon offers a free business bank account consultation with every business incorporation where their team will help you understand the available options.