E-resident company: How to open a bank account in Estonia (and how to keep it)
Entrepreneur in several countries, I often coped with the impossibility of opening a bank account, whether personal or corporate. I even coped the fast closure of accounts that I had so much trouble opening. Little by little, talking with bankers at different levels, from the simple teller to the CEO and the person in charge of security procedures, I understood what my mistakes were. Now my success rate with banks is much higher.
One of the biggest challenges for e-residents of Estonia is actually opening a bank account in Estonia (IBAN – International Bank Account Number – starting with the letters EE). When I traveled to Estonia to open an account, I expected an obstacle race described by others, including two dates, the first to present the case and the second a week later to sign documents if the bank luckily agrees to open the account. Without any appointment, I opened the door of the first branch and one hour later I left with my Estonian company bank account number. Afterwards I opened accounts in several other banks in Estonia. We share here the result of years of researchs and experiences.
The following method (compact as your time is precious) will not guarantee you to open a bank account either, but it will greatly increase your chances, if you follow it carefully.
Why open a bank account in Estonia?
A bank account in Estonia rather than in another country has several advantages.
- Companies like Apple or Google, for example, require their Estonian partners to have an Estonian bank account to sell digital products on their platforms. Payment processors (for cashing bank cards) may also require having a bank account in the same country as their partner's company.
- A bank offers better deposit guarantee (up to 100,000 euros) than a "fintech" (contraction of the words "finance" and "technology") like TransferWise or Paysera. While a fintech is not allowed to use the deposited money, it usually hands it over to a bank, and if that bank fails, the money would be lost in most countries. It's like all fintech clients use the same bank account with a total guarantee of 100,000 euros. On the other hand, if a fintech goes bankrupt, the money can in theory be recovered (there have been incidents around the world where, in practice, this has not been possible). Beware of the confusion, many people wrongly call "neobanks" fintechs that do not have a banking license and, therefore, no deposit guarantee up to 100,000 euros.
- A bank can offer services that a fintech cannot offer (except in partnership with specialized organizations), credit and credit cards for example.
- There are also term accounts with high interest rate in Estonia, for example 2.5% (or more!) per year are common at TBB (a guaranteed investment up to 100,000 euros). This is, to our knowledge, one of the best rates on the market for euro.
Who is this method not for?
This method is not for you:
- If you are looking to reduce your taxes thanks to e-residency or thinking of hiding an account abroad (the bank could be considered complicit in tax fraud), or
- If you are ready to lie to a banker and forge fake documents, or
- If you want a bank account to transact with cryptocurrencies (because they compete with banks in addition to being accused of allowing money laundering), or
- If you are a resident of one of the blacklist (North Korea, Iran, Myanmar) of the Financial Action Task Force (FATF), or
- if you are resident of a country in the EU list of non-cooperative jurisdictions for tax purposes (American Samoa, Anguilla, Antigua and Barbuda, Bahamas, Belize, Fiji, Guam, Palau, Panama, Russia, Samoa, Seychelles, Trinidad and Tobago, Turks and Caicos Islands, US Virgin Islands, Vanuatu), or
- If your activity is illegal or subject to certain authorizations, in particular in connection with counterfeiting, tobacco/electronic cigarettes/CBD/narcotics, explosives/weapons, sexual activities/dating, casino/lottery... Or
- If you are a "politically exposed" person in a country (elected, or candidate…).
The following method is based on legality, we insist on this point.
If you live in a country of the gray list (Barbados, Bulgaria, Burkina Faso, Cameroon, Croatia, Democratic Republic of Congo, Gibraltar, Haiti, Jamaica, Mali, Mozambique, Nigeria, Philippines, Senegal, South Africa, South Sudan, Syria, Tanzania, Türkiye, Uganda, United Arab Emirates, Vietnam, Yemen) expect a much harder work.
For the countries mentioned above, the residence matters, not the nationality. If you are, for example, from Iran but live in a country like France, you will be treated by the bank in principle like a French person.