How to open a UK business bank account from the US
- •Requirements for opening a UK business bank account from the U.S.
- •Can I open a UK business bank account online?
- •Costs and fees associated with opening a UK business bank account from the U.S.
- •Opening a UK bank account as a non-resident
- •GBP accounts with Airwallex simplify international business
- •Begin transacting in the UK From the U.S. with Airwallex
International travel isn’t always feasible for those looking to quickly open a foreign bank account. And it’s especially unlikely that you’ll travel overseas to make simple transfers or deposits for your business.
Nevertheless, you may find that your business needs to open a UK bank account. Maybe you’re moving from the U.S. and taking your business with you, or perhaps your business is growing and you need to expand your horizons with different currencies.
Requirements for opening a UK business bank account from the U.S.
The UK and U.S. have cultural and geographical differences, but their banking systems are fairly similar since they were born of the same origin. However, the U.S. Federal Reserve is much more independent than the UK Bank of England — it has a higher number of duties.
The U.S. Federal Reserve sets the reserve requirement through legal processes, but in the UK there’s no legal limit to how low it can fall. In extreme cases, the UK government can overrule actions taken by a bank, whereas the U.S. cannot.
In other words, the UK government has more control over banks than the U.S. This leads to more restrictions when opening a business account.
In order to open a UK business bank account from the U.S., you’ll need:
Proof of identity for all directors in your business, which can either be a passport, driver’s license, social security card, or some other form of government-issued identification
Proof of address, which can be found on a recent bank statement, your utility bill, tax form, or something else
You’ll also need to provide some details specific to your company, including:
Your contact details and full business address
Your estimated annual turnover
Your Companies House registration number, also known as your ACN
Certificate of incorporation, memorandum and articles of association (if a limited company)
Luckily, you don’t have to worry about being a UK resident to open a bank account from the U.S. since there are no legal restrictions holding you back. All of the large UK banks (such as Lloyds, HSBC, Barclays, and NatWest) offer international business bank accounts for nonresident directors so long as your business is registered with the UK Companies House.
There are certain anti-money laundering policies that will make the process for a nonresident a bit longer. However, the bottom line is that opening a UK international business bank account is possible — there are just some strict requirements to meet in order to do so.
Can I open a UK business bank account online?
Opening a UK business bank account is best done online. The larger banks in the UK will allow you to open an international digital bank account online whether you’re a resident or not.
Once you’ve entered in the necessary credentials, you may need to make a large initial deposit depending on the bank you choose. For example, Lloyds and Barclays require a minimum initial investment of GBP 25,000 while HSBC requires nothing.
You’re also likely to face monthly account fees and minimum deposits each month to maintain balance thresholds and prove your business is up and running. You might need to speak with someone directly for assistance through an international phone number to ensure you’re choosing a bank that best fits your business needs.
Costs and fees associated with opening a UK business bank account from the U.S.
Annual and Monthly Fees
Some UK banks charge monthly fees anywhere between £0 to £7.50 per month. HSBC, for example, offers free banking for 18 months, then charges £6.50 for every month after. In comparison, Barclays charges £6.00 per month if you maintain an average balance of £25,000 or more in cash or investments for four straight months. But if you go below that, they charge £20.00 per month.
For annual fees, some banks charge up to an average £60 to £78, and others offer fee-free banking for the first year.
Bank teller and ATM fees
Some banks offer free transactions, but these usually come with particular limits until you begin paying them per transaction. You can typically expect to pay between £0.35 and £0.60 per transaction outside of certain limits.
International transfer fees
You can expect to pay around 2.6% to 3.5% of your transfer amount based on exchange rates and international transfer fees. Money transfer specialists can cost around 60% to 70% less.
For example, if you’re looking to internationally transfer £35,000, you can expect to pay between £1,050 and £1,400 in fees.
However, UK banks use a tiered system. This means that the exchange rate margin is dependent on the amount of money that you transfer. Small transfers have a much larger exchange rate margin than larger transfers. You’ll find that the best rates are reserved for transfers meeting £200,000 and above.
Account closure fees
Account closure fees are rare, but you can never be too sure. It’s best to look over your product disclosure prior to closing your account, or contact your UK bank directly to get the most accurate information.
Foreign exchange rates
A foreign exchange (FX) rate is the relative value between two different currencies. In other words, an FX rate is how much money in a foreign currency you can buy with a single U.S. dollar.
For example, one U.S. dollar is equivalent to GBP 0.74. Therefore, when you send U.S. currency to the UK, your dollar will depreciate and your recipient will receive less than you may have intended. You’ll have to consider FX rates when sending a particular dollar amount to the UK and take depreciation into account, literally.
Opening a UK bank account as a non-resident
Let’s take a look at what you can expect when opening a business account at some of the UK’s largest banks.
Opening an account with HSBC is tough in the sense that you must:
Already be one of their customers
Be based in the UK
Open your account in person
Essentially, you can open a business bank account with them, but not from the U.S.
Barclays allows you to open a business bank account outside of the UK by doing so online, but they’ll expect an initial deposit that’s surprisingly high. As mentioned above, your initial investment must range between £25,000 and £250,000.
You’ll need the following in order to apply for and open your UK business bank account:
An initial investment between £25,000 and £250,000 (which you’ll need to maintain for the first four months)
An American income of $250,000 or assets worth $2.5 million
It’s more feasible to open a business bank account with NatWest as a nonresident, but you’re still required to have a minimum account balance. Unless you have £2 million or more in turnover, you’ll need around £100,000, which can get you started with a community account. You’ll also need to prove an annual salary of £75,000.
But here’s the catch: While NatWest is one of the easier banks to open a business account with, you’ll need to be in the UK to start it.
Lloyds requires an initial deposit of £100,000 as well as proof of income of £50,000 or more. While most large businesses won’t have any trouble with this level of a deposit, many startups and smaller businesses may struggle to make this work.
Online banking is a feasible and reliable alternative for those who can’t go to the UK to open an account for their business. Airwallex allows businesses to open international bank accounts from the U.S online, from the comfort of their home or office.
GBP accounts with Airwallex simplify international business
An Airwallex Global British Pound (GBP) Account allows you to open a business account in GBP from the comfort of your home. You won’t need to travel, visit a physical branch, or even have proof of a UK address.
Open your Airwallex GBP foreign currency account by simply going online and completing a quick process.
Airwallex has no signup fees, monthly account fees, or burdensome annual card fees. You’ll enjoy the ability to send and receive GBP to and from your account through a local sort code and account number without any hassle, and a low FX margin fee at 0.4% above interbank rates. And don’t worry about an initial investment — we don’t require one.
Begin transacting in the UK From the U.S. with Airwallex
Open up an Airwallex foreign currency account within minutes and we’ll help you get your business functioning and thriving on a global level in no time at all.
Or sign up and get a demo of our GBP Global Account. We’d love to show you how you can start winning new markets.
Evan Dunn manages the growth of Airwallex's SMB business in the US through marketing avenues. Evan is a generalist with expertise in SEO, paid media, content marketing, performance marketing and social selling. He also enjoys slam poetry and waffle making.