Opening a bank account in the USA provides individuals and businesses with access to the world’s largest economy and a host of financial services that are second to none. The banking sector in the USA is robust, diverse, and competitive, offering a variety of options for different types of accounts and services.
It’s also equipped with state-of-the-art digital banking services and customer service. While the USA bank account setup process is quite straightforward for residents, it also welcomes non-residents, albeit the process is more complex and involves fulfilling certain additional requirements.
However, the benefits one can reap from having a US bank account justifies this initial effort. By being part of the American financial system, you will have seamless access to some of the world’s leading financial products and services.
| Remote opening |
Yes |
| Opening difficulty |
Medium |
| Currency |
USD$, USD |
| Minimum deposit |
Typically $0 to $100, depending on the bank and account type |
| Non-residents accepted? |
Yes, though it can be more complex and requirements vary by bank |
Why choose a Bank in USA?
The USA banking sector is among the world’s most robust and offers a wide range of financial products and services. By choosing to set up a bank account in the USA, one can tap into this financial ecosystem, facilitating both domestic and international transactions.
Advantages
There are several benefits associated with setting up a bank account in the USA.
- Access to a broad spectrum of financial services.
- Facilitates international business transactions.
- Highly advanced digital banking services.
- Multiple options for different types of accounts.
- Potential to build a US credit history.
Disadvantages
While there are many advantages, one must also consider a few potential drawbacks of opening a bank account in the USA.
- Non-residents may face a more complex account opening process.
- Some banks may require a Social Security number (SSN).
- Some banks may require in-person visit for non-residents.
- Managing taxes may be more complex for international account holders.
- Exchange rate fluctuations might affect the value of deposits.
Types of bank accounts in USA
Personal bank account
A personal bank account in the USA is designed for individual consumers. It includes checking accounts, which are used for daily transactions such as paying bills, and savings accounts, which offer higher interest rates and are intended for long-term savings. Many US banks also offer Certificates of Deposit (CDs) and money market accounts.
Business bank account
Business bank accounts in the USA are typically separate from personal bank accounts and help businesses manage their operations. They offer features such as payroll services, business credit cards, merchant services, and more. They may include business checking accounts and business savings accounts.
The banking sector in USA
The USA banking sector is dynamic, highly competitive, and incredibly diverse. Composed of thousands of community banks, regional banks, and national banks, the sector provides a wide array of services catering to different customer needs.
From regular checking and savings accounts, to specialized services for businesses, the US banks are known for their customer-centric approach, innovation, and compliance with international standards. The US banking system is tightly regulated and transparent, providing customers with a sense of security and trust in the robustness of the system.
Commercial banks operating in USA
There are numerous commercial banks operating in the USA. Some of the most well-known include:
The USA is home to a large number of commercial banks that cater to a diverse range of customers and their financial needs. Here are a few:
- JPMorgan Chase: This is the largest bank in the USA by assets. It offers a range of services including checking and savings accounts, credit cards, mortgages, and investment services.
- Bank of America: Bank of America operates nationwide and offers services ranging from personal checking and savings accounts to business and investment services.
- Wells Fargo: This bank offers a wide range of services including personal, small business, and commercial banking services.
- Citigroup: This is a global bank offering a wide array of services. In the USA, Citigroup offers services such as checking and savings accounts, credit cards, mortgages, and investment services.
- U.S. Bank: This is the fifth-largest commercial bank in the USA, offering a comprehensive range of banking services.
- PNC Financial Services: PNC operates in 21 states and offers services such as personal banking, asset management, and corporate banking.
How to open a bank account in USA
Eligibility
The eligibility for opening a bank account in the USA varies depending on the specific bank and the type of account. In general, you need to be at least 18 years old to open a bank account on your own, though some banks allow minors to open accounts with a parent or guardian as a joint owner.
- Age requirement (usually 18)
- Valid identification (passport for non-residents)
- Social Security Number (for residents, certain non-residents)
- Physical address (can sometimes be foreign)
- Initial deposit (varies by bank and account type)
Required documents
There are several documents required to open a bank account in the USA. The exact requirements may vary based on the bank and type of account.
- Proof of identity: A passport is typically accepted. Residents may use a driver’s license.
- Proof of address: Such as a utility bill or lease agreement. Some banks may accept a foreign address.
- Social Security Number or Individual Taxpayer Identification Number: For most banks, this is required. However, some banks will allow non-residents to open an account without this.
- Initial Deposit: The amount varies by bank and account type.
Steps
Here are the typical steps for registering a bank account in the USA:
- Choose the right bank and type of account for your needs.
- Ensure you meet the eligibility requirements.
- Collect the required documents.
- Apply for the account. This can usually be done online, though some banks may require an in-person visit.
- Deposit the minimum amount required to open the account.
- Wait for approval. Once approved, you can start using your account.
Frequently asked questions
How long does it take to register a bank account in the USA?
The process to register a bank account in the USA varies depending on the specific bank and account type. For a basic checking or savings account, it might take anywhere from a few minutes to a few business days. Online applications are generally quicker and might receive almost immediate approval.
However, if you’re a non-resident or applying for a more complex business or investment account, the process might take a few business days or longer due to the additional checks and documentation requirements. After the account is opened, it may take a few more days to receive your checkbook and debit card in the mail. It’s always best to check with the specific bank to get an estimate of the timeline.
Can a student open a bank account in the USA?
Yes, a student can open a bank account in the USA. In fact, many banks offer student-specific accounts with features like no monthly fees, free checks, and lower minimum balance requirements.
To open an account, a student would typically need a form of identification, proof of address, and a Social Security Number or Individual Taxpayer Identification Number. For international students, a passport, student visa, and proof of US address may be required. It’s a good idea to check with the specific bank for their requirements.
How secure are bank accounts in the USA?
Bank accounts in the USA are generally very secure. US banks are regulated by federal and state authorities to ensure their financial stability and compliance with banking laws. In addition, deposits in US banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor, per bank, in the event of a bank failure.
Most banks also offer security features such as two-factor authentication, fraud monitoring, and alerts for unusual activity. However, as with any financial account, it’s important to take precautions such as using strong, unique passwords and protecting your personal information.
What is a joint bank account in the USA?
A joint bank account in the USA is an account that is owned by two or more people, typically relatives or business partners. All owners of a joint account have equal access to the funds and can make transactions independently. This can be convenient for managing shared expenses or income.
However, it also means that any account owner can withdraw all the funds without the consent of the others, so it’s important to have trust and clear communication between all parties. As with individual accounts, deposits in a joint account are insured by the FDIC up to $250,000 per depositor, per bank.
How to choose the right bank in the USA?
Choosing the right bank in the USA depends on your specific needs and circumstances. Here are some factors to consider:
- Types of services: Make sure the bank offers the services you need, such as checking and savings accounts, credit cards, or loans.
- Fees: Check the bank’s fee schedule for things like monthly maintenance fees, ATM fees, and overdraft charges. Some banks may waive certain fees if you maintain a minimum balance or meet other requirements.
- Access: Consider the bank’s accessibility, including the number and location of branches and ATMs, as well as the quality of their online and mobile banking platforms.
- Customer service: Good customer service can be crucial when you need help with your account. Consider checking reviews or asking others about their experiences.
- FDIC insurance: Make sure the bank is insured by the FDIC, which protects your deposits up to $250,000 per depositor, per bank.
It’s a good idea to compare several banks and consider your financial habits and needs before making a decision.
What is a business bank account in the USA?
A business bank account in the USA is an account used by businesses to manage their money and conduct transactions related to the operation of the business. This can include checking accounts for everyday transactions, savings accounts for reserves or specific goals, and merchant services accounts for processing customer payments.
Having a separate business bank account is important for keeping business finances separate from personal finances, which can make accounting and tax preparation easier. To open a business bank account, you’ll typically need your business’s tax identification number (EIN for corporations and LLCs, or the owner’s SSN for sole proprietorships), your business formation documents, and a business license if applicable.
What are online banks in the USA?
Online banks in the USA are banks that operate primarily or entirely online, without physical branches. This allows them to cut costs, and they often pass the savings onto customers in the form of lower fees and higher interest rates. Online banks offer many of the same services as traditional banks, including checking and savings accounts, loans, and credit cards.
They also generally offer robust online and mobile banking platforms for managing your money. Some people prefer the convenience and advantages of online banks, while others prefer the personal service and face-to-face interaction of traditional banks. FDIC insurance applies to online banks just as it does to traditional banks, protecting your deposits up to $250,000 per depositor, per bank.
Can a non-US citizen open a bank account in the USA?
Yes, a non-US citizen can open a bank account in the USA. However, the process can be more complicated and require more documentation than for US citizens. Non-US citizens will typically need a passport, proof of US address, and possibly a Social Security Number or Individual Taxpayer Identification Number.
Some banks may also require additional identification or documentation, especially for non-residents. Different banks have different policies, so it’s a good idea to check with the specific bank for their requirements.
What are the challenges of opening a bank account in the USA?
Opening a bank account in the USA can have its challenges, particularly for non-residents. One major challenge is the need for certain types of identification, social security number, and proof of address, which non-residents may find difficult to provide. Moreover, some banks require account holders to make a certain minimum deposit or maintain a minimum balance in their accounts, which can be a barrier for some people.
Navigating the different account types and understanding the associated fees and charges can also be complex. Finally, some banks may require non-residents to apply in person, which can be inconvenient for those living outside the USA.
What types of bank accounts are available in the USA?
In the USA, there are several types of bank accounts available to individuals and businesses. The most common types are checking and savings accounts. Checking accounts are designed for frequent transactions such as depositing checks, withdrawing cash, and making payments. They usually come with checkbooks and debit cards. Savings accounts, on the other hand, are intended for money that you want to save and grow over time.
They generally earn interest and are not meant for daily transactions. Other types of accounts include money market accounts, which are similar to savings accounts but typically offer higher interest rates, and Certificates of Deposit (CDs), which lock in your money for a fixed period in return for higher interest. For businesses, there are business checking and savings accounts, merchant services accounts, and others designed to meet the unique needs of businesses.
How is the banking sector in the USA?
The banking sector in the USA is robust, diverse, and highly developed. It is one of the largest and most influential in the world, home to some of the world’s biggest banks, including JPMorgan Chase, Bank of America, and Citigroup. The sector is characterized by its competitiveness, innovation, and strict regulation. Banks in the USA offer a wide range of services, from traditional deposit and lending products to investment banking, wealth management, and digital banking services.
Despite the strong presence of large multinational banks, the sector also has numerous regional and community banks that cater to the specific needs of their local communities. The sector is overseen by several regulatory bodies, including the Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the Consumer Financial Protection Bureau (CFPB), ensuring its stability, transparency, and adherence to international standards.
What are the eligibility criteria for opening a bank account in the USA?
Opening a bank account in the USA requires meeting certain eligibility criteria:
- Age: Most banks require account holders to be at least 18 years old. However, some banks do offer accounts for minors with parental consent.
- Identification: Valid identification is required. For residents, this could be a US passport or driver’s license. For non-residents, a foreign passport might be acceptable.
- Social Security Number (SSN): Many banks require a SSN to open a bank account. However, some banks may allow non-residents to open an account with an Individual Taxpayer Identification Number (ITIN) or even without a SSN or ITIN.
- Proof of Address: This could be a utility bill or rental agreement. Some banks might require a US address while others might accept a foreign address for non-residents.
- Initial Deposit: Most banks require an initial deposit to open the account. The amount varies depending on the bank and the type of account.
Please note that specific requirements can vary between different banks and account types.
