Hong Kong is one of the most popular jurisdictions in which to register a location independent business. Unfortunately, opening a local business bank account has become nearly impossible for non-residents. That is, until neat.hk came along. In this guide, I review the service and explain how best to use it.
There have been multiple reports recently (2021) about issues with neat. It seems that most of those issues are related to the EUR product but some have also been related to the HKD product. I recommend caution in the short-medium term.
It is no secret that it has become increasingly difficult for non-residents to open Hong Kong bank accounts. That is especially true for business bank accounts and while the banks cite KYC regulations as the cause, profitability is often closer to the truth. SME accounts just are not profitable enough, in the context of Hong Kong.
This has obviously become a significant source of friction and a major deterrent to registering a location independent business in Hong Kong.
Things are changing, however, thanks to a number of fintech startups dedicated to bringing Hong Kong banking into the twenty-first century. One of those is neat.hk, a wallet service offering a product similar to Revolut For Business.
Foreign-owned, Hong Kong-registered businesses can open an account online in minutes, without the need for a personal visit. Multiple MasterCard prepaid cards can be issued and a number of accounting and invoicing features are offered at no additional cost. Best of all, the account is linked to a real, dedicated Hong Kong bank account number (unlike most of these wallet services which use shared numbers). This means that you can link it to PayPal, Stripe and any other services you wish.
It is important to understand that the product is still very much a work in progress, however, and that you will likely experience more friction than you would with similar services in Europe or the US. It still is better than having no account, in my opinion.
To open an account, simply visit this page. You will need your business registration documents, your business plan and the KYC documents for all directors and shareholders. Depending on your business activities, you may have to provide additional documents. It takes around one week for an account to be activated. Pricing depends on business activities and so does account limits. Neat.hk has a long list of blocked countries, if you are from one of those countries / reside in one of those countries you are pretty much out of luck.
Now on to the nitty-gritty. While the account is dedicated, it is important to understand that it is not a true Hong Kong bank account. Funds are not covered by the government guarantee scheme, there are types of payments you cannot send and some functionalities such as direct debit and cheque writing are not available. As for the cards, they are coded as prepaid MasterCards and must be loaded separately. In other words, they are not MasterCard Debit and they do not draw automatically from the main account. This is a positive, in my opinion, as it allows for greater flexibility especially when cards are issued to employees and contractors. With that said, you will not be able to use them for services that require debit or credit cards.
For more information about Hong Kong, visit the Hong Kong hub on Freedom Surfer.
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