How to open a Canadian business bank account from the US
- •Requirements for opening a Canadian business bank account from the US
- •Can I open a Canadian business bank account online?
- •Costs and fees associated with opening a Canadian business bank account from the US
- •Opening a Canadian bank account as a nonresident
- •CAD business bank accounts with Airwallex
- •Propel your US business expansion to Canada with Airwallex
Businesses that are looking to globally expand typically need to open a foreign bank account.
However, it’s not always feasible to travel across borders, let alone overseas, to open a bank account for your business. Nevertheless, you need to open one somehow.
Here we’ll take a look at how you can open a Canadian bank account from the US so you can start growing your business as fast as possible.
Requirements for opening a Canadian business bank account from the US
The US and Canada have cultural and geographical similarities. But in terms of banking, there are some differences — one of them being the number of banks. In fact, there’s over 7,000 banks in the US and only 28 domestic banks in Canada.
This makes banking in the US a bit more complex, especially since we have a higher population and a generally more “crowded” economy.
Alternatively, Canada’s financial system consists of the “Big 6” banks, which control a striking 85% of domestic assets. Here are Canada’s “Big 6” banks specific to each province:
While Canada’s banking system is certainly more concentrated due to its lower number, it’s also more diversified. It reaches into various sectors, including insurance, brokerage services, loans, deposits, wealth services, and more, which is substantially helpful for US businesses expanding to Canada.
In order to open a Canadian bank account from the US, a business owner needs to submit valid forms of identification (one being a photo ID and the other government issued). You’ll also need additional required documents depending on your business type.
Sole proprietorships require the following additional documents:
Trade name registration
Master business license
Corporations require the following additional documents:
Two forms of ID from signing authorities at the corporation
Articles of incorporation
Corporate profile report
Certificates of status, compliance, and existence
Corporate annual government filing
Notice of assessment for income tax
Business number and business license
Partnerships and limited partnerships require the following additional documents:
Trade name registration
Registered declaration of partnership
Copy of partnership agreement
Can I open a Canadian business bank account online?
This depends on the bank. Some Canadian banks require you to be physically present, while others don’t.
Additionally, some banks require you to visit the physical branch and be present at the time of opening, but not at any other point down the road. Others will allow you to open an account online. However, opening a Canadian account via online banking usually entails more requirements and account restrictions.
Or let’s say you choose Toronto Dominion as your bank of choice. TD is an American National Bank, and is also a subsidiary of the Canadian multinational Toronto Dominion Bank, which might be easier for your business to work with if you can’t travel. You can potentially open a TD bank account in the US and have it transferred to Canada.
However, you should expect excessive fees since Toronto Dominion is technically holding the international bank account for you. They might also require a high minimum balance.
You should call the specific bank you’re thinking of opening an account with to clarify whether you can open an account online or not. Directly speaking with someone at your Canadian bank of choice is the only way to know for certain whether you can open a bank account online as well as whether the bank can match your business needs.
Costs and fees associated with opening a Canadian business bank account from the US
You can expect some amount of fees regardless of the country you open a business bank account in. And this includes Canada.
You can typically expect monthly or annual account maintenance fees, debit fees, deposit fees, and ATM fees with a Canadian bank account.
There are also foreign transfer fees as well as transaction limits that are especially relevant to US businesses on a growth path. For example, RBC charges $13.50 per global transfer, and you can only send up to $2,500 at a time. While this might be fine for small- and medium-sized businesses (SMBs), it can certainly hold back large corporations from carrying out smooth operations.
Take Toronto Dominion, for example. TD Bank will charge up to $25 per transfer. This is a substantial hit to profit for most SMBs, especially if they make a high number of daily transactions.
Additionally, you could also be charged for your incoming SWIFT payment network transfers. SWIFT’s network covers Canada, so any funds coming into your Canadian bank account may also be subject to fees. TD, for example, charges $17.50 for incoming global transfers.
Opening a Canadian bank account as a nonresident
Can you open a Canadian bank account as a nonresident? Yes, you can. Canada does not require residency to open a business bank account.
However, the process of opening a Canadian bank account is relatively long and not the simplest. But if you have all of your required documents in-hand and ready without error, the process shouldn’t be too difficult.
Let’s take a look at Canada’s “Big 6” banks and their main account offerings.
Royal Bank of Canada (RBC)
RBC charges monthly fees between $5 (for the Digital Choice account package) and $100 (for the Ultimate Business account package). However, these fees can be waived if the minimum account balances are met.
You can receive complimentary online business banking services from RBC.
The “Newcomers to Canada” package (which includes a cash reward) is provided by RBC for business account owners.
Toronto Dominion (TD) Bank
TD offers a range of checking account options for businesses.
A TD Business Simple Checking account charges a $10 monthly fee, and requires a minimum deposit of $25 to open an account.
TD offers five different Small Business plans with monthly bank account fees ranging between $19 and $125.
A TD Unlimited Business plan provides unlimited transfers, deposits, and withdrawals.
Customers with an Unlimited Business plan benefit from waived monthly account fees if they use TD’s financial services, including TD small business lending, TD Digital Express, or Merchant Solutions.
Bank of Nova Scotia (Scotiabank)
Scotiabank allows electronic payments, same-day availability for deposits made in-branch, as well as next-day availability for night deposits.
You can tailor your account fees based on your usage to save money.
Get one free transaction for every $1,500 kept in your account.
Scotiabank offers a USD account option to help US businesses avoid foreign exchange (FX) rate fluctuations as well as currency conversions.
Bank of Montreal (BMO)
BMO offers four different business account plans with various features, fees, and flexibilities.
A Business Builder 2 plan, for example, requires no minimum balances, allows 70 transactions per month, features two e-transfers, and charges a $45 monthly fee. It also features unlimited transfers to other BMO accounts, and unlimited Moneris transactions (Moneris is Canada’s largest debit/credit card processor).
Canadian Imperial Bank of Commerce (CIBC)
CIBC accounts have numerous features that help small businesses narrow down the most suitable plan for their operations.
For example, small businesses often sign up for the Basic Business Operating Account that has a low monthly fee, and you only pay for the features you actively use.
CIBC customers also have access to transaction reporting through Cash Management Online.
Customers can assign transactions to individuals within a business, as well as receive unlimited small business convenience cards for no cost.
National Bank of Canada
NBC account benefits are known to get better with time.
Your first year charges no monthly fees (as well as up to three years), free phone support seven days a week, access to financing, and unlimited electronic transactions.
Year two and three offers a National Bank Mastercard, online bank statement, and payroll deposit or electronic payment of two bills per month.
Related article: The best way to collect payments from Canada
CAD business bank accounts with Airwallex
Airwallex allows you to open a business account in CAD from the comfort of your home. You won’t need to travel, visit a physical branch, or even have proof of a Canadian address.
You can create your Airwallex CAD foreign currency account by simply going online and completing a quick and free signup process. We charge zero monthly account fees as well as zero annual fees when using our virtual borderless cards.
Enjoy the ability to receive and send CAD from your global account through a local sort code and account number without any hassle at all. Here are some additional benefits of Airwallex’s global accounts:
Low FX margin fees between 0.4% and 1.0% above interbank rates
Full payment amounts guaranteed upon delivery when using our local payment method
Market-beating FX rates for transfers, no matter the size of your transaction
Initial investments aren’t a requirement, either. So no need to shuffle money around to meet a minimum account balance.
Propel your US business expansion to Canada with Airwallex
It only takes a few minutes to create a foreign currency account with Airwallex. Our goal is to make your international finances as simple as possible so your business can thrive.
Sign up for free and get started today.
Related article: 6 Reasons why your bank transfer might be delayed
Margaret runs marketing for Airwallex US, working with great companies across eCommerce, consumer goods, consulting, and tech to deliver excellent experiences to shared audiences.
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