To common users of banking services, money transfers are money transfers. As in, you don’t consider them complex: just a tool to send and receive funds. But then, you face a plethora of terms like bank transfers, wire transfers, electronic payments, online transfers, and so on. And you start to wonder – “is there a difference between all of these?” and “what should I use?”. Well, let’s figure it out together! In this article, Genome will primarily focus on bank transfers and wire transfers and how they differ and compare wire payments to other transfer options as well. Wire transfer:
What’s the first thing you do after booking tickets and housing in a foreign country? That’s right, you think about your payment options and day-to-day banking. It’s no secret that having a foreign account would simplify a lot, no matter whether you’re traveling for business or pleasure and whether it’s a short trip or long-term stay. It’s not all about low fees or beneficial currency exchange rates. In fact, having and using a foreign account abroad also has a lot to do with comfort. If you’re in a foreign country, you do not need any hassle or complications with the speed of your financial transactions, obscure banking rules, and unknown charges.
Opening and managing an overseas account is not rocket science, but how do you choose one? What’s more reliable and cost-effective: high-street banks or fintechs? In today’s Genome blog post we’ll explore all the options and walk you through the whole process with our practical guide.
Who needs a foreign bank account
“How to open a bank account overseas?” – this question bothers many people from different countries and social circles because we all want to spend money effectively without paying extra charges. By saying “foreign account” here, we mean a regular account for daily expenses.
Generally, an account overseas will have the most benefits for people traveling abroad often or those who moved to another country for an extended period. Of course, the number of advantages depends, to a great extent, on your needs and financial provider. Many banks and financial institutions have their branches all over the world and provide excellent services overseas, such as reduced fees for ATM withdrawals or favorable currency exchange rates.
Many people still prefer using cash when they travel, especially if it’s a short touristic trip. On the one hand, it’s a smart decision: you exchange the necessary amount and spend it abroad. No difficulties with managing accounts, withdrawing cash or looking for an ATM nearby while you should be relaxing and enjoying the journey. On the other hand, paying with cash usually takes more time and is not all that safe – tourists are easy prey in big cities and busy places, like most sights and attractions. You can even lose or forget money or wallet along with other documents that you need for traveling like visa/passport/COVID vaccination certificate/etc.
On the contrary, if you’re a lucky owner of a foreign bank account, you can:
- purchase everything with a bank card;
- use this card via Apple/Google Pay and pay with your phone or other smart devices;
- send and receive transfers with a local bank, which is cheaper and faster;
- close an account any time, even online (depends on the provider).
Types of foreign bank accounts
All accounts can be divided into three broad groups:
Also known as checking accounts, the current accounts are made for everyday use. It’s a basic account that you can have with most financial providers.
These are great for earning interest on your long-time savings. Usually, cash withdrawals and most other financial operations are restricted with savings accounts.
With a few different currencies available, international transfers, payments (both online and in physical stores), as well as cash withdrawals abroad should be cheaper and more convenient. Speaking of which, Genome also offers multi-currency accounts! Open a personal or a business wallet and start up to 5 IBAN accounts within them in each of said currencies: EUR, USD, GBP.
Each situation is unique, so go for the account that will work best for you instead of stepping into your brother’s/sister’s/friend’s shoes and going for an account with the same provider that might not have all the services that YOU need. In the next part of our article, we will weigh up the factors that influence your choice of a bank account overseas.
Choosing the right bank to open a foreign bank account online
We’ve prepared a short list of the most common questions to answer before you finally opt for that one special account with a financial provider abroad.
How long are you staying abroad?
Depending on the length of your trip or stay, you will need more or less money. If it’s just a weekend in Europe, a foreign account might not be a must. However, if you’re staying longer, an account can save you not only money but also time. For instance, instead of looking for a place with the best currency exchange rate, you can do this with your bank within a few minutes.
Do you need more than one foreign currency?
If you’re planning to visit multiple countries, you will probably need different currencies. Look for banks that offer multi-currency accounts and pay attention to currency exchange fees, as well as ATM charges.
Are you visiting a big or a small country?
Developed countries have large banking networks and numerous partners worldwide. Your financial provider can even have branches in the country you’re traveling to. Thus, you will not need a foreign bank account. Conversely, smaller countries may be not so advanced when it comes to finances and banking. That is why you might not receive top-notch banking services and experience there.
What financial operations will you be doing (transfers (domestic or international ones), online payments, ATM withdrawals, etc.)?
Are you planning to withdraw cash or use a bank card mainly? Will you be making transfers overseas or only domestic ones? Get familiar with the range of services a foreign bank provides before opening an account with them.
What are the fees?
How much will you pay for the aforementioned financial services? Are there any other cheaper options out there?
Do you need advanced mobile and web applications or a bank with physical branches?
Here you should analyze your banking habits: whether you need a mobile banking app or a web application, how do you prefer communicating with client service (in chat, via phone, email, etc.), and so on. For some people, a user-friendly intuitive banking app is a defining factor when choosing a provider, while others still want to visit branches and do everything there.
The same goes for the option of applying for an account online. If it’s just a short trip, you might want to open and close an account online to not waste any time signing and submitting documents.
These are the crucial aspects that have a tremendous impact on your choice of financial provider abroad. As we’ve already mentioned before, everybody has their own needs and requirements for overseas accounts. Therefore, the only recommendation here is to compare all the options beforehand and choose wisely based on what financial operations you will be doing abroad.
How to open a foreign bank account online: guide
Of course, all the steps of applying for an account overseas on the Internet will differ with every provider. The widespread phases of the onboarding process are the following:
- Register on the website or via mobile application with a phone number or email;
- Fill in the application and upload the required documents or photos (proof of residency, ID, visa, etc.);
- Pass verification;
- Wait up to a few days till your application is approved;
- Some banks will demand to top up an account or make a small deposit to activate it.
After all these steps, you’re all set up and should be able to have full access to the account, including such services as ordering a bank card, instructing a transfer, and so on.
Can a foreigner open a bank account in Europe
The requirements for having an account with a financial provider overseas vary from country to country. It’s a wide-known fact that traditional high-street banks will demand more documents and information. Digital banks (fintechs), in their turn, are more flexible and will probably review your application pretty fast with the minimum data required.
Here’s a list of the most common documents that you will need for a foreign account:
- Proof of identity
Usually, you will need a state ID or passport for this. Some providers also accept student IDs or driving licenses.
- Proof of residency
Some banks require proof of residency for both your home country and the country where you’re applying for the account or where this bank is based. For this, you can submit utility bills or rental contracts in your name. You can also try to send in an ID with the address printed on it. Each provider has a specific list of documents they can approve.
Additionally, you can be asked to provide an employment contract or visa (if you need these for the official stay abroad).
*For business accounts, there’s a whole different set of requirements, including articles of incorporation, list of all shareholders, registered and operating address of your company, etc.
How Genome can help
With Genome, you only need an ID to have a personal wallet. Receive your current account in no time: start with signing up in a web or mobile application using either email or phone number. The next step is to fill in our online application. The last step is to pass verification using your ID and smartphone. Voila! Your European current account is ready to go! Make use of multi-currency accounts, favorable exchange rates, free and instant internal transfers – all this and more with Genome wallet.
Can I open an international bank account?
Yes, and you don’t even have to leave your home country for this. No matter if you will use an international account for short trips abroad or for a long-term stay in a foreign country, you can do this via the Internet. Remember that not all banks provide such services. Some of them still demand the physical presence of their clients in one of the branches to apply for the account.
Can you open a foreign bank account online?
Not all of them, but there are both traditional and digital banks that allow customers to apply for an account with them online. The onboarding process usually takes a few business days – you will need to fill in your personal details and submit the required documents. Similarly, you can also close an account online anytime. This is especially handy when you don’t have much time to visit branches to arrange everything.
What do you need to open an international bank account?
The requirements vary from bank to bank. In most cases, you need to present proof of identity and residency. However, additional documents can be also required. These can be visas, employment contracts, etc.
What countries allow non-citizens to open bank accounts?
There’s no specific list as such. It’s best to check with the bank or financial provider whether they can help non-residents with obtaining an account. Nowadays, many fintechs and even some traditional banks will not require proof of residency.