Banking and money movement for Hong Kong companies: accounts, licences and compliance

Hong Kong Banking and Money Movement for Companies

A Hong Kong company must move money. That means choosing between bank accounts, virtual bank accounts, and payment institution accounts. It also means understanding which licences apply if the company itself moves money for others. Every account opening decision is shaped by the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), the Hong Kong Monetary Authority's requirements, and the specific licence regime that applies to the company's activities.

Hong Kong Business Bank Account

A Hong Kong business bank account is the standard way a company receives revenue, pays suppliers, and manages payroll. Banks licensed by the Hong Kong Monetary Authority (HKMA) apply customer due diligence under AMLO.

This is not a formality. The bank must verify the company's identity, its ownership structure, and the source of funds that will flow through the account. It will request the Certificate of Incorporation, the Business Registration Certificate, the articles of association, proof of the registered office, and identification for all directors, shareholders, and significant controllers. Evidence of the intended business is also required.

Applications are declined where the business has no demonstrable connection to Hong Kong, where the ownership structure is opaque, or where the stated activity is in a sector the bank has exited. Prepare the full documentary package before approaching a bank. An incomplete application resets the clock.

A business bank account is a deposit-taking account. Balances are protected under the Deposit Protection Scheme up to HK$800,000 per depositor per bank. This protection does not apply to payment institution accounts.

Money Service Operator Licence Hong Kong

A money service operator licence Hong Kong is issued by the Commissioner of Customs and Excise. It is required to operate a money changing or remittance service. Any company that offers currency exchange or transfers money out of Hong Kong for customers must hold this licence. There is no de minimis threshold.

The Customs and Excise Department administers the licensing regime. The applicant must demonstrate that the business is fit and proper, that the beneficial owners and controllers are identified, and that the company has adequate anti-money laundering controls. Operating without a licence is an offence under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance. The department prosecutes.

Hong Kong Virtual Bank Business Account

A Hong Kong virtual bank business account is offered by a bank that operates without physical branches. Virtual banks are licensed by the Hong Kong Monetary Authority under the same regulatory framework as traditional banks. They must meet the same capital requirements and are subject to the same customer due diligence obligations.

Virtual banks offer faster account opening than traditional banks. They still require the same documentation: Certificate of Incorporation, Business Registration Certificate, articles of association, and identification for directors and significant controllers. The application process is digital. The compliance checks are not reduced.

Deposits held with a virtual bank are protected under the Deposit Protection Scheme, just as they are with a traditional bank. The account is managed through a mobile app or website rather than through a branch.

Hong Kong Money Movement Regulations

Hong Kong money movement regulations are set by the HKMA, the Customs and Excise Department, and the Securities and Futures Commission (SFC). The key pieces of legislation are the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the Money Lenders Ordinance (Cap. 163), and the Securities and Futures Ordinance.

For a company that moves its own money, the regulations apply through the bank's customer due diligence. The bank must know the source of funds, the beneficial owner of the company, and the nature of the business. For a company that moves money for others, a licence is required. The distinction is binary.

The Faster Payment System (FPS) is a real-time payment platform operated by the HKMA. It allows instant transfers in Hong Kong dollars and renminbi between participating banks. FPS is available to business account holders at most banks and virtual banks.

Payment Institution Accounts

A payment institution account is not a bank account. Payment institutions are licensed under the Stored Value Facility regime or as money service operators. They are not authorised to take deposits. Funds held with a payment institution are not protected under the Deposit Protection Scheme. The company bears the credit risk of the institution itself.

Payment institutions offer multi-currency accounts, often with lower fees and faster onboarding than traditional banks. They suit companies that need to receive and send payments in multiple currencies, particularly for cross-border trade. Understand that the institution is not a bank and that the funds are not protected in the same way. Confirm the institution's licence status with the HKMA before depositing.

The HKMA regulates stored value facilities. A company that issues a stored value facility, such as a prepaid card or an e-wallet, must hold a licence from the HKMA unless an exemption applies.

Money Lenders Ordinance Cap 163

The Money Lenders Ordinance (Cap. 163) regulates the business of money lending in Hong Kong. Any company that lends money to others must hold a money lender's licence issued by the Commissioner of Police. Operating without a licence is an offence.

The licence application requires the company to disclose its beneficial owners, its directors, and its business plan. The Commissioner will assess whether the applicant is fit and proper. The licence imposes conditions on the interest rate that can be charged and the way loans are advertised. The statutory cap on interest is 48% per annum. Above 60% is a criminal offence.

A company that only borrows money from a bank does not need a money lender's licence. The licence is required only when the company lends money to others as a business.

Securities and Futures Commission Regulated Activity

The Securities and Futures Commission (SFC) licences regulated activities under the Securities and Futures Ordinance. The regime covers 13 types of activity, from dealing in securities (Type 1) to advising on corporate finance (Type 6) to operating an automated trading system (Type 7).

A company that carries on a regulated activity in Hong Kong must hold an SFC licence. This applies to companies that deal in securities, trade futures, manage assets, or advise on investments. The licence application requires the company to demonstrate adequate financial resources, that its directors and representatives are fit and proper, and that it has appropriate systems and controls. The SFC expects a physical presence in Hong Kong.

The SFC also regulates the offering of securities to the public. A company that raises funds from the public through an initial coin offering or a token sale may be carrying on a regulated activity. Seek legal advice before launching any token-based fundraising.

Customer Due Diligence and Source of Funds

Customer due diligence is the process by which a bank or other financial institution verifies the identity of its customer and assesses the risk of money laundering or terrorist financing. Under AMLO, banks must conduct customer due diligence when opening an account, when a transaction exceeds a threshold, or when there is a suspicion of money laundering.

Source of funds is a key part of customer due diligence. The bank will ask where the money deposited into the account comes from. Evidence may include bank statements, invoices, contracts, or tax returns. The bank will also ask about the source of wealth of the beneficial owner. Provide documents that trace the funds back to their origin. A bank statement from another institution in the same name is the minimum.

A significant controller is any individual who holds more than 25% of the shares or voting rights of the company, or who otherwise controls the company. The bank must identify all significant controllers and verify their identity. Keep the company's significant controller register current. The bank will check it against the Companies Registry.

Multi-Currency Account and FPS

A multi-currency account allows a company to hold and transact in multiple currencies within a single account. Most Hong Kong banks and virtual banks offer multi-currency accounts. The account supports Hong Kong dollars, renminbi, US dollars, euros, and other major currencies.

The Faster Payment System (FPS) is a real-time payment platform that connects participating banks and stored value facilities. FPS allows instant transfers in Hong Kong dollars and renminbi using a mobile phone number or email address. Business accounts at most banks can send and receive FPS payments. Register the company's FPS identifier with the bank during account opening to receive payments on day one.

FPS is operated by the HKMA. It is available 24 hours a day, 365 days a year. There is no minimum transaction amount, and most banks do not charge a fee for FPS transfers.

Summary of Licence Requirements

A company that moves its own money does not need a licence. A company that moves money for others, lends money to others, or deals in securities for others must hold the appropriate licence. Operating without a licence is an offence and can result in fines and imprisonment.