A company can open a bank account only after it has obtained its business license.
It will take at least two weeks or longer to complete the account opening procedure for one bank account. The length of time depends on the bank.
The original passport for the company's legal representative and authorized signatories for the account must be submitted to the bank in order to open the account. If the legal representative or authorized signatories are based overseas (e.g., the U.S.) and are unable to fly to China or send the original passport to the bank, some banks may accept:
Please note the above is subject to each bank's own policy.
Prior to obtaining the license, some investors pay expenses directly from the parent company or from the investor's personal account. However, as China has strict regulations for cross-border payments, this creates barriers for the parent company or the individual to be reimbursed even after the subsidiary in China has opened its bank account and injected the registered capital.
A preliminary expense account ( 前 期 费 用 账 户 ) may be a better option. In this case:
The most commonly used bank accounts for doing business in China include:
Capital accounts in RMB and foreign currencies to accommodate registered capital injections.
Basic accounts in RMB only. These accounts have certain restrictions:
Settlement accounts include two approaches:
There are significant differences between capabilities and limitations of Chinese banks and those of foreign banks.
Foreign banks' capabilities and limitations:
Chinese banks typically offer:
Regulation is one of the biggest challenges for foreign companies doing business in China. Therefore, it is important that the company has local resources to assist them.
Cross-border business is still under supervision. Once trade transactions have begun, the banks are still required to verify the supporting documents to verify the background of the trade transactions.
Heavy reliance on “window guidance.” Window guidance refers to verbal instructions from the regulators about a new policy or a temporary adjustment to an existing rule in lieu of a formal written notification. Though it is referred to as guidance, it is mandatory at a certain level.
Frequent regulatory changes. Banks receive hundreds of new rules and regulations updates every year from different regulators.
Centralization vs. decentralization. Though central government has its rules and regulations, each local government may have its own implementation rules and interpretations. As a result, business practices may differ from city to city.
Similarly, different banks in different cities, and even the same bank’s different branches/sub-branches in the same city, may have different approaches to the same business.
Vistra employs more than 3,500 professionals across 75 locations in 48 jurisdictions. In China, we help foreign companies with market entry including setting up Offshore Company Structures, Incorporation in China, Virtual CFO and HR Solutions.
Grace Zhu is responsible for PNC’s business in mainland China and Hong Kong.
She has more than 25 years’ experience in the banking industry in Shanghai, including check clearing, payments, cash management, trade finance and loans business. Prior to joining PNC Bank, Zhu served other major U.S. and international banks.
Zhu holds a bachelor’s degree in finance and taxation from Shanghai University of Finance & Economics and a master’s degree in business administration from the joint program of Shanghai University of Finance & Economics and Webster University.
Karen Wang has been helping overseas companies enter China for more than 10 years. She gained her experience from multinational organizations and international consultancy firms, where she advised overseas clients in a variety of industries, including manufacturing, consumer goods, trading and consulting, including both multinationals and startups.
Wang co-chairs the American Chamber of Commerce Future Leader Committee and is a frequent speaker on China-related topics.
Established in 2008, PNC's Shanghai Representative Office (SRO) is available as a resource to PNC clients who are doing business with China or in China. The SRO can provide assistance and guidance on:
If you are new to doing business in China, you may find that opening a bank account is a little more complicated than you might expect.
This document and the Information it contains is intended for informational purposes only, and should not be construed as legal, accounting, tax, trading or other professional advice. You should consult with your own independent advisors before taking any action based on the Information. Under no circumstances should the Information be considered trading advice or a recommendation or solicitation to buy or sell any products or services or a commitment to enter into any transaction. The Information is gathered from sources PNC Bank believes to be reliable and accurate at the time of publication and are subject to change without notice. PNC Bank makes no representations or warranties regarding the Information’s accuracy, timeliness, or completeness. All performance, returns, prices or rates are for illustrative purposes only. Markets do and will change. Actual results will vary, and may be adversely affected by exchange rates, interest rates, or other factors.
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PNC Bank’s Shanghai Representative Office was approved by the China Banking Regulatory Commission on April 16, 2008. PNC’s Shanghai office is prohibited from engaging in any form of operational business activities in compliance with the People’s Republic of China on Administration of Foreign-funded Banks released by the State Council. Accordingly, PNC’s Shanghai Representative Office does not accept deposits, underwrite loans or issue credit of any kind, or sell wealth management products in China. Any activities of these types in China using the PNC name or trademarks are not authorized by PNC.
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