Having a foreign bank account, or offshore account, can be very useful. For expats living or working abroad, freelancers with international clients or those supporting family overseas, international banking can prove to be an invaluable way of managing your finances wherever you are in the world. In this guide we will run through the various aspects of foreign bank accounts and the process behind transferring money to a foreign bank account.
A foreign bank account, or overseas bank account, is set up to hold funds with a financial institution based somewhere outside your home country.
For example, if you are residing in the UK for 6 months, as a non-resident, you may want to open a bank account to manage your money while in the UK.
An offshore bank account is another term for a bank account in a country you do not reside in. Foreign and offshore bank accounts are one and the same.
For those with spending a significant amount of time overseas, it is worth considering banking abroad. As some domestic banks charge for international transactions and foreign ATM withdrawals, having an international bank account can help you avoid these sort of charges.
Anyone relocating overseas, permanently or an extended period of time, will benefit from a foreign bank account. There are plenty of foreign bank accounts designed specifically for people living an international lifestyle.
Funds held in foreign bank accounts are treated differently to money in domestic bank accounts. To avoid possible penalties, and to guarantee eligibility, make sure you clear up any credit concerns or outstanding tax issues before opening a foreign bank account.
Foreign banks will request the following information when opening a new account:
If you are thinking of using a foreign bank account, chances are you may need to make regular international money transfers as a way of managing finances in multiple countries and currencies. If this is the case, learning what sort of international bank transfer services are offered by your new foreign bank is paramount. Oftentimes banks can charge an excessive amount of money for transfer fees and for anyone sending or receiving regular international payments, this may be a deal breaker. Find out what the common fees associated with international bank transfers are in this guide.
Foreign bank accounts benefit many people, and there are a multitude of reasons for using one. Many reputable banking and financial institutions offer suitable and secure options for foreigners. However, if, after reading this guide, you remain unconvinced about using a foreign bank account, perhaps virtual banking might be a better fit for you: What is a Virtual Bank Account? As always, we recommend using our comparison tool before initiating international payments of any kind.
April is a trained journalist and the Content Editor for MoneyTransfers.com. She has 10 years experience writing about a diverse range of subjects, from financial services to arts and entertainment. When she’s not writing about global remittances she can be found daydreaming about her next holiday abroad.