Best place to open a bank account? UK or USA?
An ex colleague of mine (american) has asked me to form a joint venture partnership with his american company which I am keen to do. We will offer summer camps for international children to learn English. Initially we will run all courses in the USA and so will receive payment in USD and our suppliers will all be American also. I will look after the finance and would like to have a UK bank account in pounds and Dollars but am worried this will be difficult and expensive. Can anyone advise?
I believe there are UK banks which offer accounts in USD.
However from my experience I think you will find the biggest problem is that the payments your potential US customers will want to make will be paper cheques as Americans prefer to use them rather than electronic transfers. This most likely means you will need a bank account in the US for deposits or perhaps use your american business partner’s account. American suppliers also like paper cheques and, incredibly, US banks offer online services that generate the paper.
If you would like further advice you are welcome to contact me at [email protected]
Whilst some UK banks do offer US Dollar bank accounts for smaller companies and start up enterprises they can be quite expensive. I second Peters comment above, that you should have a US bank account, not so much for the cheque banking side of it as it sounds like it will not be American children attending the camp. but to save you money of your transfers of money.
Banks are well known for charging for anything they can. If you had a US Dollar account they would still charge you for each overseas transaction whether it involved currency exchange or not. If you need to repatriate funds to sterling to cover your wages or expenses then you can look options of using a broker or a bank. But I know which one will cost you less!
Feel free to contact me if you wany to discuss your situation in more detail.
Depending who you bank with in the UK, there should be no problem with you opening a USD Bank Account here in the UK.
The issue you will have (and this is where we can help) is you will invoice and get paid in USD. When your clients deposit the USD into your USD Bank Account the Bank will in all likelihood charge you an awful FX rate to convert your USD into GBP.
At ParityFX we can help by getting your clients to pay us directly (into our FCA compliant Client Money Accounts) and we would then convert the USD for you into GBP and deposit the GBP directly into your GBP Account. This way, you pay no fees nor are you subject to the awful exchange rate you will have been charged.
If you would like some more information please call me on 0207 112 1530 or have a look at our website www.parityfx.com where you will find additional information and contact details.
I hope this helps
Regards and best wishes
David Rosenberg (Joint CEO)