Can I Open a Bank Account While Living in Another Country?

By Jamie Cattanach · April 01, 2022 · 7 minute read

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Can I Open a Bank Account While Living in Another Country?

If you’re planning on living abroad for work or play — or both — it can be a smart and necessary move to open a bank account in that country.

You’re going to need access to your funds if you’re staying longer than a typical holiday, which many people are doing in this era of digital nomadism. If you keep your American bank account, you’re likely to face dozens of foreign transaction fees, which can feel like death by a thousand papercuts, even if each individual fee is small.

Fortunately, opening a bank account in a foreign country is totally possible — and totally legal, as long as you’re not doing so for tax evasion purposes.

However, it may take a few more steps than opening a domestic account would. Here, we’ll answer the question, “How can I open a bank account in another country?” so you know just what’s involved.

What is Banking Abroad?

Banking abroad is pretty much exactly what it sounds like: It involves opening a bank account in a country that is not your primary or official country of residence or citizenship.

If you’re an American, this means opening a bank account in any other country, whether it’s Canada or Cambodia. Of course, some countries — such as, famously, Switzerland — are specifically known for what are called offshore bank accounts, thanks to incentives such as high levels of financial privacy and serious deposit protections. These features can and have attracted the attention of high-net-worth individuals over the years.

But opening a foreign bank account isn’t reserved only for the ultra-rich. Regular, everyday individuals may benefit from banking abroad in certain circumstances. If you are wondering if you can open a bank account overseas because you’ll be spending the bulk of your time there, you definitely can!

Is Banking Abroad Legal?

The answer to the question, “Is banking abroad legal?” is: Yes, if you’re doing so for the right reasons.

Most of us associate banking abroad with nefarious activities like money laundering or tax evasion, which are, of course, illegal — and could result in large fines or even imprisonment.

But if you’re living in or earning legitimate wages in a foreign country, opening an account there is totally legitimate. It’s also likely your best bet for avoiding excessive foreign transaction fees. It will also reduce or eliminate the hassle of having to deal with a customer service team based in a very different time zone.

Some people also open offshore bank accounts for investment purposes, but these are an advanced technique of money management. If this interests you, it’s worth enlisting the help of a financial professional to ensure you’re staying above-board. Foreign investments or offshore banking for tax purposes can be quite complex.

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How to Legally Bank Abroad

In order to legally open a checking account in a foreign country, you’ll need to verify quite a lot of personal information for the bank. This is so all the parties involved can confirm you’re banking in a foreign country for legal reasons, and not engaging in common illicit activities associated with foreign banking such as tax evasion or money laundering. You will probably have to share some details with U.S. officials, too.

So what does all that mean for you as someone interested in opening a foreign bank account?

Paperwork, mostly — potentially lots of paperwork. (Still, it’s not that difficult!) Let’s dive into exactly what you’ll likely need so you’re well prepared.

Recommended: Can I Open Two Checking Accounts with One Bank?

Requirements to Open a Bank Account Abroad

The specific documentation you’ll need to provide to open a foreign bank account will depend on a lot of factors. Among the variables that may impact exactly what you’ll need to provide: The specific bank you choose, the regulations of the target country, how much money you’re planning to deposit or hold in the account, and more.

Generally speaking, though, you can plan to provide the following:

•   Proof of identification, such as a passport or driver’s license

•   Proof of residence, such as a utility bill

•   Up to a year of bank statements from your current bank account in the U.S.

•   Paystubs or a statement from your employer

•   Documentation relevant to investments or business transactions, such as sales contracts

Keep in mind that these documents may need to be notarized by a third party or sent through the local consulate for the target country in order to be deemed official. The bank will give you explicit instructions on all required documentation and may also ask for a written statement of purpose for opening the account.

Don’t overlook the home team either! The U.S. government is likely to have its own questions about your activities. If the value of your account abroad will be more than $10,000, you’ll need to file a Report of Foreign Bank and Financial Accounts (FBAR) . Bear in mind, too, that interest earned on monies held in foreign savings accounts are still taxable here at home. Always consult with a professional if you have questions about your tax liability!

Pros and Cons of Offshore Banking

So, what are the benefits and drawbacks of offshore banking? When does opening a foreign bank account make sense — and when is it just plain convoluted? Allow us to break it down for you.


•   An offshore bank account can help you avoid foreign transaction fees if you’re living or doing business in a foreign country

•   Having a bank account in a foreign country you’re living in can also make it easier to perform basic daily banking tasks without having to navigate overseas phone calls or major time zone discrepancies

•   Offshore banking can have some legitimate tax incentives — though in order to take advantage of these legally, you’ll need to consult a tax professional


•   Opening a foreign bank account can be a relatively arduous process compared to opening a domestic one, with a lot of paperwork and verification involved

•   Foreign banking can have unforeseen taxation consequences — for example, interest earned overseas may still be taxable at home

•   You may need to file additional paperwork with the IRS if your foreign account will be valued at over $10,000

Let’s see how these pros and cons stack up side by side.

Pros of Opening a Foreign Bank Account

Cons of Opening a Foreign Bank Account

Helps you avoid foreign transaction fees if you’re living or doing business abroad Complicated process involving a lot of paperwork
Easier to conduct day-to-day banking while abroad Tax considerations; for instance, interest earned may be taxable in the U.S.
There may be tax benefits to having a foreign account If your account is worth over $10,000, you likely need to file extra paperwork with the IRS

As you see, the answer to the question, “Can I open a bank account in a foreign country?” is a big yes. It’s totally possible to legally open a foreign bank account — all it comes down to is being able to provide the right documentation. Gathering and submitting this may take a while, but it can ease your time abroad tremendously so you spend more time reveling in the local culture and less energy and money taking care of your banking.

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There is, however, a small foreign transaction fee — so if you’re planning to make lots of transactions overseas, it might be worth opening multiple checking accounts, including one with an overseas bank.

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What countries allow foreigners to open bank accounts?

Most countries will allow foreign nationals to open a bank account on their shores as long as they can provide proof of legal residence in that country (and other necessary documentation). Some countries make it easier than others to open a foreign bank account, however.

Can I open a bank account in another country without being a citizen?

Yes, but you will likely need to provide extra documentation to verify your identity, place of residence, and the legal purpose of the account.

Photo credit: iStock/MicroStockHub

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