Open a Bank Account in the Marshall Islands

The Marshall Islands is a place that allows offshore company formation, therefore investors can also open an offshore bank account. In its region, the Marshall Islands has established itself as an attractive offshore destination and we also mention that it benefits from the support of the United States of America (USA), the leading economy at a global level.

Investors who want to open a bank account in the Marshall Islands should know that they also have the possibility of remote setup, which means that they are not required by law to arrive in the Marshall Islands to open the account.

Those who opt to open an overseas bank account can address our team for advice on the procedure and for assistance in any local formality that can be performed through a valid power of attorney.

What types of foreign entities can open a bank account in the Marshall Islands?

Local residents (businesses or individuals) can easily open a bank account in the Marshall Islands, as this is a guaranteed right for the populations of all countries. When it comes to foreigners, rules can vary locally, although most jurisdictions nowadays allow the right to open a bank account.

In certain places, foreigners may open the account, but they need to make the proof of having a connection to the respective country, while others do not impose any obligations. The Marshall Islands falls in the latter category, as it welcomes the following types of foreigners who are allowed to open an offshore bank account:

1. non-resident individuals;
2. non-resident companies;
3. trusts, foundations;
4. high net-worth individuals;
5. fiduciaries (financial experts, accountants, lawyers, etc.).

Documentation

In order to set up an offshore bank account (for business purposes) investors must prepare a set of documents, regardless if they complete the procedure online or in person, at the bank. Below, you can discover some of the basic documents required in this case:

1. the passport;
2. the proof of address (in the country of residence);
3. documents attesting the funds the investor has (bank statements, payslips, etc.);
4. the company’s incorporation documents.

What other criteria are taken into consideration by banks?

Whenopening an offshore account, banks in the Marshall Islands will typically verify a set of aspects, besides the documents we have presented in the section above.

As stipulated in the list, banks will verify the company’s incorporation documents so that they can observe if the company is registered in a lawful manner. They will need all the paperwork that attests the legal entity has been registered in the Marshall Islands.

Additionally, banks will ask investors a minimum deposit when opening the account, and the amount will vary in accordance with the internal policies of the bank selected.

While the process of offshore company formation does not need foreign investors to be physically present in the Marshall Islands (nor do they need to be here when setting up the bank account), the bank will require proof of physical presence for the company they have set up here.

By this, the bank’s representatives will verify if the company’s registered address is in the Marshall Islands, but they will also need details on the person who has been appointed as a local representative. Clients of local banks should also abide by the anti-money laundering laws applicable here, so verifications in this sense will take place.

We also stipulate that banks may ask for further paperwork, such as banking or professional references, especially when the clients are foreigners. Another procedure that is applied by all banking institutions refers to Know Your Customer (KYC) legal obligations. When doing so, banks will verify different members of a corporate entity, such as the shareholders, directors, beneficial owners, etc.

Why open a bank account in the Marshall Islands?

Opening a bank account here can be recommended for both corporate and personal reasons. Foreigners who want to establish an offshore company will open a local bank account, while individuals who are not interested in business endeavors can open the account for other reasons, such as securing their wealth, paying less taxes than in their home country, etc.

In the list below, our consultantspresent some of the tax advantages offered by the Marshall Islands’ legislation:

1. tax exemption on the payment of the personal income tax;
2. exemption from the payment of the withholding tax on dividends, royalties, interest;
3. individuals are not imposed with the capital gains tax;
4. businesses can be exempt from the payment of the corporate income tax.

What types of banking services are available in the Marshall Islands?

International clients who set up an offshore bank account in the Marshall Islands can obtain various banking services. Some of the most common are:

1. online banking;
2. international wire transfers;
3. multi-currency accounts;
4. debit cards.

Our team can help you select all these services when applying for an offshore bank account. Please know that, while we provide full legal representation during the setup of an account, its registration remains at the discretion of the bank selected, as per its own internal rules.

In general, banks accept clients’ requests provided that all the documentation is in place, and our team will make sure that your application file meets the required standards. In case banks will ask for further clarifications, we will get in touch with our clients for additional paperwork.

The financial sector in the Marshall Islands

Given that the Marshall Islands represents a small jurisdiction, the financial sector is comprised of only a few institutions. However, the institutions available here offer competitive services, in line with the services investors can find anywhere in the world. In the list below, our consultants present some of the highlights of the banking sector:

• according to the International Monetary Fund (IMF), the Marshall Islands’ banking sector has 8 financial institutions;
• out of these, only 2 are commercial banks, which can be used for opening an offshore account or an onshore one;
• clients can benefit from 24/7 banking services if they opt for online banking.

We invite you to contact us for personalized advice on the procedure of opening a bank account in the Marshall Islands. You can also rely on our team in the case in which you want to open an offshore merchant account, necessary in e-commerce operations.