Opening a Bank Account in Bahrain
Company incorporation process in the Kingdom of Bahrain has evolved over time. Business investors take several measures dealing with completing the company setup process in a hassle-free way. At the same time, it is essential to understand that equal measures need to be taken to proceed ahead with the bank account process. The Bahraini government mandates the business entities to move forward with the bank account process simultaneously with the company setup process. This guide outlines the several steps that are required to be taken into consideration to complete the bank proceedings.
However, let’s start with the basics of understanding the banking system in Bahrain that will help you to understand the process in a smooth way as you deal with the company set up process in Bahrain.
Banking Scenario in Bahrain
The Kingdom of Bahrain holds a strong banking network that allows the individuals and business entities to proceed with the account setup process easier, along with financial assistance. As of 2019, the nation holds a wide number of financial institutions including the top international private players like HSBC, Standard Chartered, Arab Bank etc. The complete banking system in Bahrain holds the below-mentioned aspects.
- 385 financial institutions including,
- 68 wholesale banks
- 16 branches of foreign banks
- 7 representative offices
- 36 insurance companies
- 52 investment business firms
- 53 specialized licenses
The Muslim investors widely accept the concept of Islamic finance and the region hosts several global organizations which include:
- Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI)
- International Islamic Financial Market (IIFM)
- General Council for Islamic Banks and Financial Institutions (CIBAFI)
- Islamic International Rating Agency (IIRA)
- Bahrain Institute of Banking and Finance (BIBF)
Types of Bank Account in Bahrain
The Kingdom of Bahrain holds the different types of bank accounts:
Proceeding with the current accounts grabs the maximum financial flexibility. This type of account helps account holders with instant access to the available funds. Some of the features of a current account in Bahrain include the following:
- The account can be opened by investing in international currencies like:
- Bahraini Dinars
- Saudi Riyals
- US Dollars
- British Pounds
- UAE Dirham
- The account can be opened in the name of individuals, Joint Personal, Sole Proprietorship, Society or any other legal entity
- Availability to utilize Cheque book facility
- The flexibility of free Debit Card
Some of the key essentials for opening a current account in Bahrain include:
- The account holder must hold a minimum income
- BD 500 for Bahraini holders
- BD 800 for Non-Bahraini holders
- The applicant must be at least 21 years or above
- The minimum initial deposit can be BD 300/ USD 2,500/ EUR 2,000 SAR 10,000/ AED 10,000/ GBP 2,000
However, while dealing with the current account, make sure that you don’t overdraft your bank account. In case, if the account is overdue, the respective bank might charge a substantial fee for the same.
2.Savings and Deposit Account
The savings and deposit account can be opened in any of the retail banks in Bahrain. One of the core reasons for opting for a savings account is that the deposited amount can be withdrawn at any point in time. Some of the features of a savings account in Bahrain include the following:
- Free debit card
- Low minimum balance is required
- Competitive rates
- Quick access to the deposited funds
- Free quarterly account statements etc.
How to Open A Bank Account in Bahrain?
Bahrain, being one of the booming business hubs, mandates the corporate entities to proceed ahead with opening a bank account for the relevant business entity. The process turns out to be a simple one. However, one needs to make sure that the right set of documents is required to proceed towards the completion of the process.
Documents Required for Opening a Bank Account in Bahrain
The relevant set of materials must include the following list.
- Copy of Passport of the shareholder(s)
- Copy of Visa of the shareholder(s)
- Copy of relevant Work Permit
- Copy of residential address of the shareholder(s)
- No Objection Certificate (NOC) from the existing employer
- Salary Slips (if required)
- Bank statements from the previous banks
Fundamental Essentials to Look for Before Opening a Bank Account in Bahrain
Before you proceed towards the corporate bank account process in Bahrain, certain key points are to be remembered.
- Selection of the Bank- Make sure to choose the bank close to your residence or office premise
- Proceed with the right Bank Account- Be well versed with the available types of bank account (Savings, Current, Deposit). Select the one that fits your business needs.
- Be careful with the terms and conditions stated by the respective bank
- Keep a check on the fees, as it might get deducted at the end of the financial year
Challenges Faced Before Opening a Bank Account in Bahrain
As the foreign ex-pats focus on completing the business setup process, yet, they face several obstacles when it comes to establishing a corporate bank account in Bahrain. Some of the challenges that are faced by the ex-pats include:
- Choosing the appropriate bank suiting their business needs
- Difficulty in understanding the terms and conditions
- Confusion regarding the documents to be presented
- Even a minor error might delay the process
Why Avail Corporate Banking Services in Bahrain?
As a business entity would attract a vast number of customers and deal with multiple business transactions, holding a separate business bank account helps in the following ways:
- The business owner is clear regarding personal and professional finance
- Proper track of the business transactions
- Reports can be generated to figure out the respective growth
- Helps to keep track of the investments made in a business cycle
- Maintain a robust investment portfolio
- Enhances the credit facilities
- Maintain clear accounting and bookkeeping records
- A good credit score would boost the company goodwill
- Investors get clarity regarding the relevant usage of business finance
- Helps in dealing with the tax proceedings effectively
Business Setup Worldwide is one of the top business consultants in the UAE. If you are looking forward to opening a bank account for your business, feel free to have a word with our advisors. Contact us today-we’d be glad to assist.