Opening a business bank account in the UAE: how to prepare

Banks in the UAE are licensed and supervised by the Central Bank of the UAE, which also supervises how they prevent money laundering and the financing of terrorism. Before a bank opens an account it has to know its customer. That is the reason for the questions, and it applies to every bank, large or small.

The checks come down to five things. If your file answers them clearly, the compliance team at the bank has what it needs to reach a decision. If it leaves gaps, expect follow-up questions, a long wait or a refusal. Each one is listed below.

• Identity: who the shareholders, directors and signatories are, and who ultimately owns and controls the company.
• Business model: what the company sells, to whom, and how it earns its money.
• Source of funds: where the starting capital and the wealth of the owners come from.
• Expected activity: monthly turnover, the size of payments, and the countries and currencies involved.
• Presence: a valid licence, a real office address and a signatory the bank can reach in the UAE.

Every bank has its own checklist and may ask for more as the review goes on. The items below cover what most business account applications are built from. Have clear scans ready in one folder, and keep the originals to hand for the meeting with the bank.

If the company is owned through another company, the bank follows the chain to the people at the top, so prepare the documents for every layer. Documents issued abroad are normally expected to be attested and, where needed, translated into Arabic or English.

• Trade licence, Memorandum of Association and any share certificate or company register extract
• Passport, residence visa and Emirates ID of each shareholder and signatory
• The office tenancy contract, such as Ejari or a free zone lease
• A company profile or short business plan, with your website if you have one
• Contracts, invoices or letters of intent from customers and suppliers
• Recent personal or company bank statements that show the source of funds
• For a corporate shareholder: attested company documents and a board resolution

Write one page that explains the business in plain words: what you sell, your main customers and suppliers, the countries you deal with, and the turnover you expect in the first year. Use realistic figures. An estimate far above what the business can support raises as many questions as one that is too low.

Check that the story is the same everywhere. The activities on the licence, the business plan, the website and your answers in the interview should describe the same company. Be ready to show where your capital came from with documents such as salary records, a property sale or the accounts of an earlier business.

Expect a meeting or a call with the bank, and sometimes a visit to the office. The person who will sign on the account should attend and be able to answer for the business. Reply to follow-up questions quickly and completely, because a file that goes quiet is often closed.

Most delays and refusals trace back to a small number of causes. None of them is about the size of the company or its capital. They are about whether the bank can understand the business and verify what it has been told in the application.

A refusal from one bank does not prevent an application to another, but fix the weakness in the file first. Banks rarely explain a refusal in detail, so review the whole file against this list with your consultant before you apply again.

• The licensed activity is vague or does not match what the company really does.
• The ownership structure is layered and the documents for each layer are missing.
• There is no evidence of real business, such as contracts, invoices or a website.
• The source of funds is not explained or not documented.
• The business involves countries, goods or sectors the bank treats as higher risk.
• The company has no real office, or the signatory has no UAE residence.
• Documents are expired, unclear or inconsistent with each other.

Traditional banks offer the full range: current accounts in several currencies, cheque books, trade finance, loans and a relationship manager. Their onboarding tends to ask for more documents and a meeting in person, and many set a minimum balance. They suit companies that trade goods, handle larger payments or expect to borrow.

Digital business accounts are opened through an app or a website, with documents uploaded and identity checked online. They can suit small service businesses and start-ups with simple payment needs. Check what is missing before you choose, since cash deposits, cheques or trade services may be limited, and confirm that the provider is licensed by the Central Bank of the UAE.

The right choice depends on how you get paid and what you need the account to do, not on which one opens fastest. Caliph prepares the file with you and explains which type of account your business is likely to suit. The decision to open the account always belongs to the bank.

Opening the account is the start of the relationship. Banks review business customers from time to time and can restrict an account if information is out of date or activity looks different from what was declared. Keeping the account in good order is mostly routine.

The account also feeds your tax records. Bank statements are part of the records behind your corporate tax return and your VAT position, so reconcile them with your books every month and keep them together with your invoices and contracts.

• Use the account for company business only, and keep personal money separate.
• Send the bank the renewed trade licence, tenancy and identity documents as they change.
• Tell the bank before a change of shareholders, activity or expected turnover.
• Keep the invoice or contract behind every large payment, in or out.
• Answer review questionnaires and document requests on time.
• Keep the balance above any minimum the bank sets.