Last year, opening a bank account has become one of the most difficult activity for a foreign investor. And I am not speaking just about Italy. Terrorism, money laundering, offshore banking, in order to (barely) reduce these phenomena, banks have made miserable the life of any honest entrepreneur. In this post I will try to help, at least for opening a bank account in Italy.
Rule no. 1 : It’s not the size of the fish, it’s the location of the pond.
A couple of years ago I had to work very hard to open the bank account of a big Chinese company and a big Indian company, because – guess what? – they were a Chinese company and an Indian company.
In both cases the director saved just a few hours in their agenda to go to the bank, and the last day of the Italian trip. We are speaking of two companies with a turnover of hundred millions, one of the two has more than a billion revenue in fact. Running a small a small firm, I usually help this company to start the business, than they move to the traditional (and more expensive) big law firms.
They were both used to work with big banks but none with a subsidiary in Italy. They both went to the bank counting on their fame. And they were both shocked to find that (i) nobody knew about them in Italy and (ii) none of the managers of the bank wanted to check their size on internet (this last issue is directly connected to Rule no. 2 below).
And lesson no. 1 is …
You can be famous in your country, you can run an international empire, if you are a big fish outside but you are new in the Italian pond, you need to prepare the meeting in advance like everybody else.
Rule no. 2 : Never forget that you are an entrepreneur. They are NOT.
Your company can bring great business to the bank, I agree. So what? The bank manager isn’t paid on commission. The Italian culture punish mistakes and doesn’t reward successes. If 9 companies on 10 bring millions to the bank, and the last company no. 10 made a small fraud, the manager will lose the job or – worse – will be downsized to a low level activity for years.
Don’t get me wrong, I have met many bank managers that are very business oriented and aggressively looking for clients. But they are usually not rewarded enough for their attitude, and sometimes they don’t have internal procedures to help you even if they want.
And lesson no. 2 is …
Don’t be shocked if the manager refused to setup your bank account. Give him paperwork to prove that you company is good, the more papers the better, and you have better chance to open your account if you talk business.
Rule no. 3 : Going in person to Italy or open the bank account on distance?
A few years ago it was very common for us to open the bank account on behalf of the entrepreneur. Our client was used to come to Italy only after a few months, when the business was setup and usually he had to meet a few candidates to employ as local director.
This isn’t true anymore. Many banks refuse to setup an account without meeting the client in person. Thus you should not only fly to Italy but also bring all the corporate documents to prove that (i) your company exists (ii) your company – although newly born – can bring good business to the bank (usually bringing documents of the mother company in your country) (iii) you are the owner/director of the company.
And lesson no. 3 is …
Try to go to Italy in person. Organize the meeting in advance with your lawyer because the bank will require many of these documents translated and sometimes legalized.
What to do if you really don’t have the time to open the account in person?
As an alternative – if you really can’t fly to Italy – you can check with your bank if they have a subsidiary in Italy. Because your bank knows you, in theory its sister company in Italy will be happy to take you on board. I stress the words “in theory” because Rule 2 is always around the corner (see above).
Moreover, even if you have two managers willing to help you, don’t underestimate the language barrier. If your manager doesn’t speak Italian, and the Italian manager doesn’t speak any common language, you can see quite a few weird phone calls and email exchange. They can be amusing but they are time consuming. And you need a bank account as soon as possible to start trading.
So if you plan to do business soon, try to go to Italy in person, organizing the meeting in advance with your local lawyer or chartered accountant.
Documents required to open a bank account in Italy
Here is a list of the most common documents required by the bank to open your account:
- Director’s passport or European Union identity card. Identity card issued outside Europe are rarely accepted. Moreover, if your identity card has fancy colours or looks like too much as a credit card (such as the ID of The Netherlands) it can be not accepted. In short: bring the passport every time you can.
- Director’s Italian identification code. Any director, even foreigners and non residents, is required to have one.
- Certificate of good standing of the Italian company. This certificate prove that the company exist and show the name of the directors and shareholders. In Italy ask for a “Visura” or a “Certificato della Camera di Commercio”.
- Certificate of good standing of the major shareholders (see the “Matrioska Law” below)
The “Matrioska Law” applied to opening a bank account
I am sure you have seen many times a Matrioska, the Russian wooden doll like in the picture. When you open one of these dolls, you find another smaller doll. And so one, until you have no more doll to discover.
From 2011 Italian banks are required to know any shareholder with more than 20% of your company. So if your foreign company owns more than 20% of the Italian company, prepare to bring the certificate of good standing of your foreign company.
And – this is the frustrating part – if a shareholder owns more than 20% of your foreign company, be prepared to bring the certificate of good standing of this shareholder too. And if it’s owned by a company for more than 20% … you see the picture.
The Italian bank is required to open the Matrioska’s doll one after the other until there are no more hidden dolls. Well, at least no dolls that own more than 20% of the shares.
If you have a complex structure, or if you use offshore companies, it could become more challenging. Prepare to be very patient, and email document back and forth until the bank confirm in writing that the documents are fine.
Opening a bank account can be very frustrating, but once is done you are part of the game. Enjoy.
One last note: if you see the banker looking at you in complete confusion, you have probably quoted the Matrioska law. Well, this is just a nickname among lawyers. The Italian Parliament has never officially approved a law called “Matrioska” (but they should have, I love this name).
Image source: 401(K) 2012 at Flickr.com and Virgirm at Flickr.com
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as a small import/export company dealing in mobile phone accessories, we are interested in expanding our Italian business. Would it be of benefit to us to open an Italian bank account? What would be the requirements and criteria needed to do this?
Hi Kenneth. My experience:
1) if you sell to small shops and to small importers, you will benefit from an Italian bank account (a lot). Small Italian companies are required to file extra paperwork if they send money out of the country, this is annoying and complex and you risk to lose clients.
2) if you sell to big companies, an Italian bank account is NOT required. HOWEVER if you provide goods to big chain of shops/supermarket, they will probably require you to open a branch in Italy and guarantee in writing that you don’t use child labour, fairly treat your workers, etc. This is quite common with my Chinese clients. Big retail chain doesn’t know how to control the production in China, so they want a document signed by an Italian company or branch.
Bank need to do their job and not to be so difficult with new customers. It is difficult in Italy, it is difficult in the England, it is difficult everywhere in Europe. We are small business not big money laundry. Banks should help us
i agree and it’s even worse when the client is non european. our company has branches in three foreign countries and every bank account was a pain, with the exception of austria, you feel welcomed there
I have also gone through your website officeinitaly and I am interested to take the registered office address also.
waiting for your kind revert.
Hi Mona I sold that company (Office in Italy) but I still consult them sometimes. Contact them at firstname.lastname@example.org and ask for a discount in my name. Let me know how well they will treat you. And welcome in Italy
we have a company based in Croatia and we sell services to italian people.
Having an Italian bank account would allow us to receive money from our customers to our Italian Bank account without need to register a company/branch office in Italy?
You are right. However I find very (very very) difficult that you will find an Italian bank open to setup a bank account for a foreign company. Between money laundry and anti terrorism law, they will accept a foreign company only for massive operations (millions euros or more). Just my experience
First I would really like to appreciate the way you resolved queries of people and the wide information you have given. it is really helpful.
We three indians have formed S.r.l company in Torino, company has been formed after facing lot of difficulties.
Now I am not able to open current account, Bank officials are asking “permesso di soggiorno” none of us having this document. I consulted with so many companies before and we never had this information.
I feel, it may be the problem in Torino. In Milan and Rome, it may possible to open account of srl without POS.
Can you assist me in opening account with your consultancy fee ?
Please if you can reply me soon.
Hi Mona, I sent you an email with a few address you can contact. I don’t provide bank account opening unless is part of a bigger operation. Company formation agent are quite cheaper that us (lawyers).
About your specific case, you do NOT need an immigration visa (“permesso di soggiorno”) to have a company or a bank account in Italy. However you need an immigration visa if you want to live in Italy regularly. The bank is probably afraid to help because they think you want to stay in Italy for more than 3 months. If this is the case, I am afraid you should contact an immigration lawyer. Check our page “Resources”. I will list a few there. Best luck for your Italian venture
Thanks so much for your explanations! it was really helpful! Could you tell me the official name of the “Matrioska law”? Because I really need to find the whole text!
Hi Anna there is NO law called “Matrioska”, that joke is completely on me. However, there is a real law dictating these requirements: Law Decree No. 231/2007 dated 21 November 2007. If you are going to use it for an article, maybe you wanna quote our website 🙂
Thanks for the awesome article. Just one small question can we open a no signer account in Italy for a business. Which means there are no signer who sign manually for anything and all transactions happen electronically.
Yes you can. All the major banks provide online accounts. However the bank want to meet you at least once. In theory this is not necessary (by law). In practice, banks in Italy (as well as in UK and the other countries where I work) request this meeting as mandatory.
Stefano. My question is more of a personal nature. My husband and I are considering retirement in italy. (Perhaps opening small business…maybe a B&B….nothing definite yet). I’m wondering since the exchange rate for the American dollar is poor against the euro, we risk loosing quite a significant amount of money with the exchange rate (about 30%). Do you have any recommendations on the best way to handle that loss. Are the interest rates in italy for a savings account good to off set the loss? Any suggestions would be greatly appreciated. Thanks so much for your informative website
Hi Gina. From your question, I guess that you get your pension in US dollars, but – if you live in Italy – you will spend the sum in Euro. That’s your issue. If not, please specify and I’ll try to reply.
If this is the issue, I don’t have a complete solution. Currencies go up and down. Americans were quite happy in the ’80 when the US dollar appreciated 300% in a few years, and quite worried in the last 10 years, when the dollar loss 50% of its value.
What I can suggest is to open 2 bank accounts (one in US dollar and one in Euro). The clients of the B&B will pay in Euro and you can use this money for the normal expense (rent + food + bills). If they are not enough, then and only then you can access the US dollar account. If you have both the account in the same bank, you will probably get a more favourable rate.
ps – saving account in Italy are terrible. Sorry!
By the way….if it matters….I am in the process of applying for my dual citizenship. (Not sure if that may have any bearings on your response ). Thanks. Gina
Dual citizenship is very useful for inheritance. I work with a good number of US clients and – when they have dual citizenship – we can pick the best law. If you know how to do it, a USA trust could be sometimes taxed zero% (and I mean legally. No dodging solution).
For currency conversion doesn’t help. But definitively the banks will be more open to setup a bank account (and treat your badly as much as every other Italian … just joking)
Thank you so much for your reply. I am learning that mortgages are not easy to come by in Italy, so I was thinking that I would need to have a substantial amount of “cash” to purchase a home or business there. If we were to cash in all our assests (lets just use round numbers here) and say that came to $500K, we would in theory only have 350K in Euro to spend. That $150K loss is quite huge. Now I realize that one could argue in time that money would be made up should the business be sucessful, but that also hinders the kind of property we could purchase. Also, if one were to open a bank account in Italy, does that require a trip overseas to accomplish? Can you also please explain what you mean by “Dual citizenship is very useful for inheritance” and “pick the best law”. Thank you again for your very useful information.
Could you please advise Italian lawyers who are professionally engaged in solution of such tasks like opening a bank account in Italy for a foreign, European Union-based company? Your answer and any help would greatly be appreciated.
By the way, your site is simply amazing!
Thank you so much in advance!
I will answer soon to your issue.
My aunt died in Trieste Italy 18/6, leaving my brother (born in Trieste,who resides in Australia, but is a New Zealand citizen) and myself born in Wellington NZ and NZ citizen i primi eredi. My cousin (2nd) and her husband chose a notaio and passed him all of her documents and her best friend signed over the testamento to the notaio. I have a myriad of initial questions re banks accounts, co-joined bank accounts (between my aunt and my 2nd cousin), her apartment etc. Is there any possibility that you would be available to email me. I would really appreciate it and I thankyou with all my heart. Kind regards Shirlene
Dear Shirlene, here I am (based in Milan, Italy). I am writing you by email
I am an American and Italian citizen. My grandparents were Italian and I have recently obtained my Italian passport. I see everything here is for business. Some of it still helps me. Do you know of a site, a book or a person that will help be get established. I want to open a bank account and I want to rent an apartment in Napoli. I think your blog on the bank account for business is wonderful and I will follow that although it will be easier (I hope) because I am not a business. But I want to make sure I understand things. What my obligations will be and many other questions. Thank you for your help.
P.S. I have bought the book on the history of Italy. That will help too. I am learning the language.
Sono un cittadino americano e italiano. I miei nonni erano italiani e mi hanno recentemente ottenuto il passaporto italiano. Vedo tutto qui è per affari. Alcuni mi aiuta ancora. Sapete di un sito, di un libro o di una persona che aiuterà da ottenere stabilito. Voglio aprire un conto in banca e voglio affittare un appartamento a Napoli. Penso che il tuo blog sul conto corrente bancario per le imprese è meraviglioso e io seguo che anche se sarà più facile (spero) perché io non sono un business. Ma voglio essere sicuro di capire le cose. Quello che i miei obblighi saranno e molte altre domande. Grazie per l’aiuto.
Post scriptum Ho comprato il libro sulla storia d’Italia. Questo aiuterà anche. Sto imparando la lingua.
My mother and grandparents were Italian, i have obtained a Italian passport and would like to open a bank account in Italy and invest there. Iam in South Africa.
Can you perhaps give me leads on how to go about it.