Establishing a business setup in Saudi Arabia, requires opening a bank account in the country. But setting up a bank account in the Kingdom is expected to be a tiresome task, as it can result in potential delays. Delays in the bank account setting up can disrupt your business plans and can lead to subsequent financial loss. No matter if you’re a new resident, or business owner or an expatriate, the bank account setting up delays are common for every one and navigating the intricacies are crucial for all.
In this blog, we will make you aware of the common causes of delay to set up a bank account, and the tips to overcome these delays. We will help you streamline the process of setting up a bank account by making you aware of the complex regulatory requirements involved, and how to prepare necessary documentation. Below are the mistakes to avoid when setting up a bank account in the country, to avoid subsequent delays.
- Before making important legal changes, such as changes in the parent company name, complete the banking processes.
- Inorder to avoid business disruptions, sign the account opening agreements timely.
- Inorder to avoid the complication of license expiration, keep your documents updated and submit them promptly.
So let us break down the process of starting a bank account in Saudi Arabia and help you ensure that your banking setup is as efficient and stress-free as possible.
Exploring the Reasons for Bank Account Setup Delays From a Bank’s Perspective and the Impact
In Saudi Arabia, large companies are identified as high risk entities and the processing time for them would be large due to the complex accounts management. This sometimes might lead to a month’s delay from the legal team of the bank to share the online login information to the company and grant them the access for the management of the account. Sometimes banks will do the site visit to verify the address of the company and might ask for additional documents, leading to a prolonged period of approval of the bank account.
But these delays in setting up a bank account can negatively affect the companies especially for the ones that have pending license applications or ongoing contracts. If a company is having numerous contracts and requires a Saudi bank account to receive the payment, these delays can significantly affect their business operations.
Another reason for the delay in setting up a bank account is the technical issues. If a Saudi company faces a technical issue while setting up a bank account, it is very crucial to contact a business setup company in Saudi Arabia, like Analytix so that they will help you ease your processes of setting up a bank account. They, with their experienced professionals and years of expertise, will tackle the problem and help you solve the technical issues and subsequent delays in opening a bank account in the country.
Expert Tips to Avoid Delays in Setting Up Bank Account in Saudi Arabia
It is always advisable to make any changes in the company name, registration, etc. after opening your bank accounts in Saudi Arabia. Otherwise it will cause potential delays and subsequent financial losses to the company. If you have any plan to change the parent company’s name, it must be done after the issuance of a bank account. Because if you opt to change the name of the parent company after the issuance of Iqama, then you have to amend the MISA license, Commercial Registration (CR), and Articles of Association in accordance with the business laws of Saudi Arabia. This process demands re-attestation of the documents of the parent company after the amendment, resulting in delays in opening a bank account. But this can negatively impact the business operations of the company as your contract with the Saudi clients could be put on hold leading to operational hindrances and payment of late fees due to non compliance.
Other things to note is to sign the documents promptly after the bank account opening request was accepted by the bank, because delays can cause the requests to get the invalid status and you will be blocked from making any government payments, which requires a Saudi bank account.
Also maintain a list of updated documents and submit them at least 90 days before the expiration of the company’s license. Because if your company is owned by a consortium, you are expected to provide all the commercial registers of the owned companies, passports of all individual owners, etc. If you fail in it, then commercial registration of the company and MISA license will expire before the submission of the required documents, which will lead to extra cost of renewing MISA license and commercial registration.
By taking care of the above mentioned risks, you can, to an extent, avoid the delays in setting up a bank account in Saudi Arabia.
Conclusion
Setting up a bank account in Saudi Arabia is a complex process and can be challenging, but with the right understanding and guidance, you can tackle the challenges and can have a hassle free experience. Be proactive and gather all the required documents before the submission of a bank account opening application. Ensuring your documents are right and staying informed of the latest regulations will significantly help you reduce the risk and delays. For professional guidance, you can choose the top business set up companies in Saudi Arabia like Analytix, so that you can avoid all the chances of setbacks.
Hope this blog provided you with a comprehensive idea on reasons causing delays in setting up bank accounts in Saudi Arabia and how to avoid them. Do you have any questions still unanswered? Write to us in the comment section below. Let our experts answer your doubts and guide you in the process!
