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Open a Bank Account in Panama

Updated on Wednesday 22nd April 2020

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Investors who are interested in Panama company formation will also need to open a Panama bank account for the new business. The process is not a complicated one and it can be accomplished with the assistance or the full representation of our agents when investors are not able to be present in the country during the entire process.
 
Panama offshore company formation is an option for many who are interested in starting an offshore business because of the favorable business climate as well as the simple incorporation process and the low requirements for starting a business.
 
Panama bank account creation is just one of the steps required when opening a company and investors can request specialized information and assistance form us when they wish to start a company. With our help, company formation will run smoothly and as fast as possible.
 

Steps for bank account creation in Panama

 
Opening a Panama bank account is simple, however, the investor’s presence is required in these cases. Alternatively, entrepreneurs can choose to work with a local representative, via a power of attorney, as some banks will agree to open the account when a representative of the founder is present. 
 
The steps are highlighted below by our Panama incorporation agents:
 
  1. Decide on the account type: the business needs should match the characteristics of the bank account, and investors should choose banks that have a high degree of flexibility. 
  2. Prepare the documentation: eligibility for bank account opening is required and the applicant will need to bring forward sufficient proof such as commercial references, passport, and others.
  3. Apply: the last step is to submit all of the needed documents with the bank; once they are processed, the corporate bank account is operational.
  4. Additional options: some company owners in Panama may require a merchant account; this can be opened with the same bank with which the corporate one has been opened. 
 
Some of the commonly requested documents when opening a company in Panama include a copy of the passport, with the Panama entry stamp, one or two bank reference letters, reference letter from a professional and additional ID, such as the country ID from the applicant’s country of residence. Please remember that this list of documents is not an exhaustive one and it will vary according to the chosen bank. We recommend verifying the needed documents before commencing the process.
 
One of our agents who specialize in Panama offshore company formation can help investors gather all of the needed documents before they attempt to open the bank account with the chosen bank. Our agents are well aware of the bank particularities and can even recommend which bank to choose, based on company particularities or preferences. 
 

Merchant account in Panama

 
The merchant account is a separate type of bank account from the business one that allows companies to accept payments using debit or credit cards. It is particularly useful for e-commerce businesses. The account is set up with the help of a payment processor, that can be an independent one or a member service provider. Those investors in Panama who wish to engage in this type of activity will, most likely, decide to open this account as well, if not during the initial stages then as the business progresses.
 
An important feature for the merchant account that needs to be taken into consideration when selecting this type of service is the quality of the transfer security. The secure online payment system for the business is provided by a third party and it is advisable to select a trustful service. Another option to select is the frequency of the deposits into the company’s bank account. This means that the third party processing the payment can offer this with a daily or weekly frequency, with the first option being most common. When selecting the daily deposits, investors will need to take into consideration the time difference (as they may do business with clients worldwide) and the fact that payment processing may take a number of hours.
 
Merchant accounts also allow for easy refund processing and comprehensive reporting and account management. Moreover, they allow for multi-currency processing (apart from the frequently used US dollar), an important feature for foreign investors who open a company in Panama.
 
The merchant account will be subject to a number of fees that can be implemented on a regular basis or on a per-transaction basis. These can be set by the merchant account provider and/or the bank that issues the credit card (according to credit card type and other transaction details). Some providers will also charge a customer service fee and other fees, such as the one that may be imposed for early termination (before the end of the contract term).
 
Panama merchant accounts do not hinder the confidentiality of the asset holder. Thus, this can be a trusted payment option for company owners who are interested in offshore company formation and also the confidentiality that can be maintained in this jurisdiction. 
 
One of our agents can provide investors with more information on the advantages of the merchant account, the services offered by payment processors as whether or not this is an option that should be implemented together with the first banking steps.  
 
 
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Company formation in Panama

 
Investors who open a company in Panama will be required to set up the corresponding Panama bank account during the early stages of company creation as it will be needed for company creation. While there are no initial capital requirements, companies are typically incorporated with a minimum amount and this is deposited in the company’s bank account. The shares may be with par value or without par value. The subscribed capital is not mandatory; however, the usual standard authorized share capital is 10,000 USD, divided into shares of 100 USD each.
 
Below, our team presents the main steps that are relevant for company formation in Panama. Please keep in mind that this is only a brief description and that you can reach out to our agents for more details.
 
  • Choose a company name: the name of the company is a unique one and cannot be the same as that of an already registered legal entity.
  • Choose the business form: most investors will open a business structure that has legal personality; this can be a limited liability company or a joint-stock company.
  • Prepare the company documents: a company is incorporated based on a set of Bylaws, the founding documents that state important details about the business.
  • Register: once the documents are drafted and signed by the founders, the key step is to register the new business with the Registry; one of our agents can help you during this step.
 
It is not mandatory to be present in Panama during all of these stages. Our team can help prepare the documents and represent your best interests in front of a Panama notary public and the Panama Registro Publico through a power of attorney.
 
An important issue to take into consideration regarding company formation is the requirement to comply with the licensing for certain types of businesses. For example, trust companies and others that provide financial services will need to comply with the laws and regulations set forth by the Superintendencia de Bancos de Panama
 
Below, we highlight some statistics for investments in Panama:
 
  • - the value of foreign direct investment stock in 2018 was 54,675 million USD.
  • - the foreign direct investment inward flow was 5,549 in 2018.
  • - the foreign direct investment inward flow was 4,569 in 2017.
The easy incorporation process is not the only ready why Panama is a preferred location for offshore company formation. The tax benefits are a string advantage for many investors, given the fact that when the income of the company is derived from outside the jurisdiction, it is not subject to tax. Asset protection and confidentiality, as previously mentioned, are protected here and entrepreneurs who do not wish to make their investments public can benefit from this. Moreover, there are no nationality restrictions, meaning that investors from around the world can incorporate and own their company 100%. For those interested in setting up a bank account or merchant account and making regular payments outside of the jurisdiction, there are no exchange controls, meaning that there are no restrictions on the remittance of money abroad. 
 
Flexibility is another advantage for foreign investors in Panama. Not only that they do not need to be in the country during the entire incorporation phase, but also they are free to hold the Board meetings at any other preferred location, not necessarily in Panama. 
 
Our team of company formation experts offers packages that also include the Panama bank account creation and investors can rely on our assistance for this step. Each bank in the country will offer different options and some may be more suited for particular businesses. Some of the services we remind clients to look for include online banking, ATM availability, debit and credit card issuance and conditions as well as the account management fees.
 
Contact our Panama company formation agents for more information about bank account creation as well as any other questions concerning the incorporation of various types of businesses.

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