If your company doesn’t have a corporate bank account
What are the disadvantages of not having a corporate bank account in addition to a personal account?
First, there is the risk of confusion between personal property and company property. In order to properly manage a company, it is fundamental to clearly distinguish between company accounts and personal accounts so that the company’s profits and expenses can be easily grasped.
While a personal account can be used for company purposes, opening a corporate account allows you to separate your personal income and expenses from the company’s accounting objectively.
Opening a corporate account also helps to strengthen the company’s creditworthiness. If a company designates a personal account as the bank account to which payment for a transaction is made, business partners may question the credibility of the company. In contrast, having a corporate account means that the company has passed the financial institution’s examination and obtained a corporate account, which makes it easier to be trusted.
It is getting more difficult to open a corporate bank account.
However, opening a corporate account is becoming more and more difficult.
Due to stricter laws regarding the prevention of transfer of criminal proceeds, it has become more difficult to open a corporate account.
In many cases, accounts opened under the guise of a corporation have been used for bank transfer scams and other special frauds. In order to prevent such crimes, financial institutions carefully screen their customers. After the examination, a corporate account can be opened only after it is proven that the account is a real corporation and that it will be used for legitimate purposes.
What kind of company may face difficulties in making a corporate bank account.
If the representative or major shareholder of the company has been listed on the black list because of past delays in credit card payments or bankruptcy, the bank may refuse to open an account.
Also, in cases where the amount of capital is too small, the nature of the business is not well known, or the business has no track record, the bank may not trust your company and may not open an account for you.
So, It is recommended that the amount of capital be more than 1,000,000 yen if possible. (In the case of obtaining a Business Manager Visa, at least 5 million yen in capital is required.)
On the other hand, even if you have no track record as a company, if you have a track record as an individual, it is easier to obtain credit from banks. For example, if you have a successful trading business as a sole proprietorship, you can expect the same stable earnings as a company. It is also a good idea to prepare a company brochure and business plan to make it easier for the bank’s examiners to understand your business.
When a company is small, the low rent of virtual or shared office space is very attractive. However, virtual offices and shared offices tend to be less creditworthy than regular office room rentals because you can easily move your office location at any time.
If the owner or president of a company is non-Japanese, is it more difficult to open a corporate bank account?
When the owner or president of a company is a non-Japanese resident, the bank checks their status of residence. Typical status of residence for running a company include Business Manager Visa, Start-up Visa, Permanent Resident visa, and Spouse Visa.
If the visa is not Permanent Resident Visa, banks tend to be more likely to approve the opening of a corporate account for a person who has obtained a status of residence for more than three years rather than one year, since the person is expected to live in Japan more stably.
In addition, since there are not enough English-speaking staff at the bank, it would be a good impression if you can tell them that you have no difficulty in communication in Japanese.
Necessary documents to open a corporate bank account.
The following three documents are required by the bank to open a corporate account.
- Certificate of Personal Seal Registration(印鑑登録証明書）
- Certified copy of registration of the company（登記簿謄本）
- Identification document of the representative of the company（代表者の本人確認書類）
However, banks usually ask for a variety of other documents as well.
For example, you may also need to submit the articles of incorporation, a list of shareholders, a notification of establishment of the corporation, an application for approval of blue tax return, a company brochure, documents confirming business permits and approvals, a copy of the office lease agreement, etc.
Which bank should you choose to open a corporate bank account?
First, you should consult with the bank where you have a personal account. This is because the bank with which you have a personal account are aware of your transaction history and are more likely to trust you based on your personal track record.
We also recommend that you open a bank account with a megabank. Megabanks are convenient for clients because bank counters and ATMs can be easily found anywhere in Japan, and having an account at such a bank will enhance the company’s credibility. Japanese megabanks include Sumitomo Mitsui Banking Corporation, Mitsubishi UFJ Bank, and Mizuho Bank.
However, megabanks have strict screening procedures, so if opening an account at a megabank seems difficult, you should consider other options. Smaller banks such as regional banks and shinkin banks may be easier to open a corporate account with than megabanks, as their screening process is more relaxed.
Another option is to open an account at an online bank. An online bank is a bank that does not have a branch, and is used for making payments via the Internet from a computer or smartphone. Typical online banks include SBI Sumishin Net Bank and GMO Aozora Net Bank.
