Foreign currency accounts let you place some of your dollars into other currencies so they are readily available without conversion. People who travel frequently to a given region, and businesses that have international dealings, can benefit from the use of a foreign currency account. The process of opening a foreign currency bank account online is not difficult.
Foreign Currency Accounts
Foreign currency savings, checking and money market accounts can be opened by qualified applicants from just about anywhere in the world. Technology has simplified a process that once required you to show up in person and make a cash deposit in the local currency. Instead you can now download and submit forms in your current location and make your deposit in dollars. The bank will then convert the funds to the currency of your choice at no fee. Most large banks with an international presence offer international account services to any customer for a fee and to premium or business customers for free.
Banks require you to complete an application form to open foreign currency accounts. This form requires personal and financial data and must be submitted and approved before the account can be opened. Expect to supply the basics such as name, address, date of birth and passport information. Information about your employment, political status (whether you are a government representative or other "politically exposed" person), income and debts is also required. Finally, the application form requires that you state the purpose of your new account, the amount you will using to open it, where the funds originated, and some details about the typical use the account will serve on a monthly basis. Once your application has been received and approved the account will be opened in the currency and nation of your choice.
Benefits of Account
The benefits of a foreign currency account are numerous. Should the value of the U.S. dollar fall against the foreign currency you have invested in, you stand to make a profit on the reconversion back to dollars if and when you choose to withdraw the funds locally. If you travel extensively or do business in a given location, having cash on hand in the local currency can save you significant fees associated with currency conversion. If you own property or want to move to another country, many lenders and landlords will request information about your income and assets. With a local account, you are a much more attractive tenant or mortgage applicant.
Swiss bank accounts are well known for their anonymity. They are identified only by number rather than the account holder's name. The requirements for opening a foreign currency account in Switzerland are a bit more old school than the norm. To open your Swiss account you must arrive in person at the bank with at least $100,000 to deposit. You will also have to pay an annual maintenance fee of up to several hundred dollars on the account to keep it open and operating. Despite the high cost, many wealthy people prefer to put their money in Swiss accounts because of the anonymity and security they offer.
- HSBC: France Account Opening Form (see CE notes)
- Keith Brofsky/Photodisc/Getty Images
- What Are Debits & Credits When Preparing an Income Statement?
- How Interest Works on a Money Market Account
- How to Get Car Repossession Fees Waived
- Advantages and Disadvantages of a Joint Bank Account With a Spouse
- Paper Checks Vs. Electronic Checks
- Do You Have to Keep a Minimum Balance at a Bank?
- How do I Invest in Money Market Accounts?
- The Difference Between a Checking Account and a Money Market Account
- What Is an Example of a Low-Risk Asset?
- What Can You Do When a Business Takes Money Out of Your Account Without Authorization?