The main problems when opening an account in Hong Kong

Feb 06, 2021
6 min. to read

Have you applied to open a Hong Kong bank account and been denied without the bank’s explanation? You know how complicated and frustrating it is to open a bank account in Hong Kong.

Bank account rejections more often than not concern start-ups and SMEs.

The reality, though is that the extremely stringent risk control practices of the financial industry are also making it much harder for major companies to open bank accounts.

While some corporations are lucky enough to have their bank account up and running in a matter of weeks, others wind up waiting for months. Those that have had many accountopening denials, let’s not ignore them too.

Below, we walk through the most common explanations why the opening request for your bank account does not meet the criteria of the bank and what you can do to fix it.

Why is opening a bank account in Hong Kong difficult?

Geopolitical uncertainty and evolving criminal methodologies

The management of emerging sanctions regimes has been considered by financial institutions to be a major obstacle, although evolving criminal methodologies are still seen as the greatest potential danger. This has left us rightly anxious about the need for risk plans, procedures, and controls to be handled and revised, and all as they are still grappling with the global financial crisis of 2008.


Banks have invested heavily in their regulatory departments to cope with the challenges mentioned above. In the customer ‘onboarding process, these teams are becoming more powerful than ever. If you look like a possible risk, unless the expected advantages outweigh the enforcement costs, the banks will not do business with you. There is very little reason for a bank to do business with a start-up in this situation.

Regulatory pressure

Hong Kong banks have had to upgrade their internal procedures on a virtually constant basis to cope with regulatory changes. No sooner had the US Foreign Account Tax Enforcement Act (FATCA) been discussed, then came the Common Reporting Standard (CRS) of the OECD, the 3 G20 High-Level Rules on Disclosure of Beneficial Ownership and now they have to deal with the Base Erosion and Profits Shifting (BEPS) initiative of the OECD as well.


The banks have also not saved themselves, irrespective of how tough the economic situation is or has been. According to Boston Consultancy Group statistics, banks worldwide have paid $321 billion in penalties since 2008 for an abundance of compliance failures from money laundering to financial abuse and terrorism funding. All this suggests that there is also less appetite for market risk for banks.

Challenges for opening Hong Kong bank accounts

  • The due diligence of the Hong Kong Bank is not transparent. Banks refer to this move as an internal part of their procedures. And the bankers you meet do not know the labeling method of the bank, so consumers are not able to determine the ability to open.
  • The compliance condition of the Hong Kong bank will adjust (i.e. it is normally tightened) without warning after the submission of your application.
  • The compliance department of Hong Kong banks spends weeks and even months on their backstage due diligence review as part of the due diligence requirement.
  • Hong Kong bankers you will face the need to review the operating records of your company plus your justification as verification. So, you should win their trust that your organization is legit.
  • During their analysis, Hong Kong banks can randomly request supplementary documents from you.
  • In the circumstance of rejection, Hong Kong banks hold your application for years. In the future, it would be highly difficult for clients to open accounts at the same banks.
  • As part of their “Know-Your-Customer” rule, Hong Kong banks need almost any key individual in your business to visit Hong Kong for an account opening interview with their bankers

And hence, because of the bank account opening process, we can notice that start-ups believe that Hong Kong banks are unfriendly to them:

  • Waiting too long for their backend service
  • Rejecting their proposal without justification, most importantly
  • It takes too much time to plan
  • Lack of transparency
  • Varies from banks to banks/time to time

What do banks in Hong Kong like?

Trading Businesses based in Hong Kong

If you have or are planning to have an office in Hong Kong, hire workers in Hong Kong, have clients or vendors, or both in Hong Kong, etc., Hong Kong banks are more likely to open an account for you. In other words, they’re looking to Hong Kong for true substance. This rule of thumb extends to the creation of new enterprises in Hong Kong, as well as to the establishment of branches of foreign firms there.

What do the banks of Hong Kong dislike?

Businesses dependent on cash

Hong Kong banks want to know where the funds that are sent to your account come from. Cash-based firms from a compliance standpoint, cash is a big concern for banks. For the latest digital currency, the same would be true.


In general, Hong Kong banks will not offer many extra items to start-ups and will thus not make much (or even any) cash from them. Simply put, for banks, the risk-reward equation doesn’t work. ‘Business proof’ is the one thing the banks need to justify taking on the risk.

Regulated businesses

Banks in Hong Kong don’t like working with highly controlled businesses. If the company wants authorization to work, so before they consider opening an account for you the bank would normally like to see an authorization in place.


It is much tougher to set up a merchant account with a Hong Kong bank than it should be. Hong Kong banks don’t like linking to payment gateways because the regional origins of the funds hitting the account cannot always be identified.

Companies in Hong Kong whose members and signatories live outside Hong Kong

If the organization does not have a clear justification for opening a Hong Kong bank account, it would be more difficult to open an account.

The best option for opening a bank account in Hong Kong?

Open an offshore account

Several global banks are opening accounts for Hong Kong and offshore enterprises. In general, such banks operate only with eligible implementers. A bank in Hong Kong is more likely to approve your application when you have generated at least six months of account operation with an offshore bank because by evaluating your account history, they can more reliably determine risk. Following six months of dealing, you will now have more supporting documents in place.

Office in Hong Kong

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